Dog Barking — Transparency

A post at Consumerist has deeper issues than just a  joust to consumer affairs. This goes to the very heart of a company, its relationship to its customers, and its responsibility to its investors. Essentially what is the economic value of Trust in the digital age?

The heart of this matter lays in the under current of the Enron scandal of the past. The problem being that Sarbanes-Oxley does not apply here but the truth does. But in a world that is going digital there will be few secrets. If you are a company on one of the  exchanges there is no secrets at all. Your finances are laid open for all to see. Your suppliers will list you as a customer for purposes of their own marketing. The trade press will be looking for that ‘new’ angle to sell more pulp. Your institutional investors will know more about what is wrong with your company than if you were the CEO. The lowest employee in a company can disclose sensitive matters on blogs within minutes of discovery.

Consider what Comcast is attempting here. They are attempting to hide a business relationship that is already been exposed. They are implicitly asking their employees to lie about the Comcast-Sandvine relationship. By extension they are also asking their employees to lie to the customer base. Acting this way does nothing but corrode employee morale. Then once the story is fully disclosed in public the corporate credibility is gone.  What of the institutional investors, what are they to believe when Comcast makes any ‘forward statements’ in a 10-q or annual report?

So what next? Well if Comcast does not quit digging the hole deeper multiple people up to the CEO may be out on the street, worst case. Comcast stock could take a dive on this issue though it is slight. But an important bit, the Net Neutrality forces have been given a very large club against the forces arrayed against them.

In a room full of liars, the first to tell the truth is the most powerful person.