VIENNA, Austria, Sept. 17 /CNW/ -- The fastest way to restore confidence
to America's bludgeoned financial services industry is through unprecedented
transparency amongst all players, says Don Tapscott, influential business
strategist with nGenera Corporation and co-author of the best-selling business
book "Wikinomics: How Mass Collaboration Changes Everything."
"Rebuilding trust takes total transparency, which is completely feasible
and affordable in a digitized world. As financial instruments became more
complex they became more opaque, which has proved disastrous. We need lots of
the sunlight that smart digital tools could offer."
Tapscott is a keynote speaker this week at the Sibos 2008 conference in
Vienna, Austria. With 7,000 attendees, the conference is the global financial
services industry's premier event.
"We can't afford the almost two decades that it took for Japan to recover
from its 1990 financial implosion. The US industry requires fresh capital and
updated regulations, but that's not enough to reboot the system," says
Tapscott. "Investors have been burnt badly, and some won't fully trust Wall
Street for many years, possibly a generation.
"Bankers and business leaders should be looking to collaborate around a
private sector solution to the chronic problems undermining the financial
services marketplace. They need to rethink many assumptions of the basic modus
operandi of the financial services marketplace.
"For example, investors should be able to 'fly over' and 'drill down'
into a Collateralized Debt Obligation's underlying assets. With full data,
they could readily graph the payment history, and correlate information such
as employment histories, recent appreciation (or depreciation), location,
neighborhood pricings, delinquency patterns, and recent neighborhood offer and
sales activities. Now that AAA ratings have proved worthless, currently
investors don't have a glimmer of what they are being asked to buy. And they
won't start buying until they fully understand what they are purchasing and
know that the price is fair.
"Inevitably, once the deep issues underlying this credit crisis are
exposed, there will be calls for more stringent regulation -- just as in the
1930s the SEC was created, and 'unit trusts' (now mutual funds) were forced to
disclose their holdings. In the age of Wikinomics -- or true mass
collaboration as an economic force -- we don't need another round of onerous
Sarbanes-Oxley style provisions. Rather, new avenues for transparent
collaboration between market participants would be far more robust than hiring
more oversight bureaucrats. For over a century, we've understood the value of
transparency in pricing for market goods. As securities become more complex,
we can use new digital tools to bring that same market approach (transparency
and collaborative evaluation) to underlying information as well."
Tapscott is Chair of the innovation network arm of nGenera Corporation,
an Austin, TX-based technology company serving a marquee list of Global 2000
customers. nGenera Corporation provides a suite of subscription-based
offerings to enable the Next Generation Enterprise. Powered by software and
people, nGenera gives organizations sustainable, breakthrough capabilities in
leadership performance, talent management and development, and customer
The annual Sibos conference is the only global event that covers all
sectors of the financial community, and attracts the industry's leading
figures and companies. Attendees range from established financial institutions
to application and middleware vendors, system integrators, central clearing
systems and consultants. Leading experts in their field come to debate and
share their knowledge about new technologies, processes, requirements,
alliances, efficiency and security.
For more information:
JB Labs, Inc.
For further information:
For further information: Jessie Brumfiel of JB Labs, Inc.,
+1-805-686-2718, firstname.lastname@example.org, for nGenera Corporation