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The state in which all relevant information is fully and freely available to the public. Nearly every analyst agrees that transparent markets are desirable because they lead to greater efficiency. Laws and regulations exist in most jurisdictions encouraging or mandating transparency. For example, the SEC requires disclosure forms declaring a great many different actions when or immediately after they occur. Likewise, the Sarbanes-Oxley Act is designed to increase transparency in accounting. A minority view holds that these laws and regulations intended to create transparent markets in fact reduce efficiency. Others contend that markets are efficient with or without transparency. See also: Efficient market hypothesis.


The full, accurate, and timely disclosure of information.
Case Study Ford Motor Company executives indicated in spring 2001 that the company planned to provide shareholders and analysts with greater transparency of the firm's financial results. As part of the improved transparency, Ford was expected to report separate results from its Premier Automotive Group (PAG), comprising Aston Martin, Jaguar, Lincoln, Land Rover, and Volvo Cars. In the prior year Ford reported an operating loss of $35 million in Europe only because income from PAG and customer services mostly offset operating losses of nearly $1 billion in its other European operations. At the time Ford did not report profits for individual brands or product groups. Transparency permits shareholders and analysts a greater understanding of a firm's operations, including which parts of the firm are most and least profitable. This, in turn, places greater pressure on the firm's management to produce acceptable results in all facets of a company's operations.


Transparency is a measure of how much information you have about the markets where you invest, the corporations whose stocks or bonds you buy, or the mutual funds or other investments you select.

For example, in order to achieve maximum transparency in US markets, the Securities and Exchange Commission (SEC) requires corporations to disclose all information that might have an impact on their financial status so that investors can make fully informed decisions.

Real-time trading information, increasingly available to individuals as well as institutional investors, and linked pricing systems are other steps toward complete transparency.

References in periodicals archive ?
While transparency is valued by employees and can engender trust, too much transparency distorts behavior and changes conduct in workplaces.
API is also a leading provider of a suite of cloud based software tools which includes contract automation, employee on boarding, electronic cumulative folder, invoice process solutions, and fiscal transparency.
It was developed by Carl Linaburg and Michael Maduell in 2008 and is published quarterly by the Sovereign Wealth Fund Institute, outlining funds' performance in 10 key areas of transparency.
The Department concluded that, of the 140 governments that were potential beneficiaries of foreign assistance and were evaluated pursuant to the Act, 50 did not meet the minimum requirements of fiscal transparency.
The Enforcement of Transparency Procedures in the Public Sector
These measures propelled Kenya to 55th place in the Transparency Index from 67th in 2012.
He said that for the disclosure of national security requests to be meaningful to users, it must be within a range that provides sufficient precision to be meaningful, and not undermine transparency, the report added.
Mumtalakat was created to align and implement the execution of the government's initiatives to pursue value-enhancing opportunities, improve transparency and help achieve operational excellence for its state-owned non-oil and gas related assets.
The significance of transparency rests with the fact that it functions as an open communication channel between the stakeholders and officials; it is a key instrument to right rampant corruption across the developing countries.
Speaking on the occasion, Farzana Raja said that during last four years of serving the poor, BISP has maintained and ensured transparency and accountability on every level.
He added that the National Assembly had ratified the Convention in November 2006, pointing out that the government is also working in collaboration with the National Assembly on the fight against corruption in any sector, including working to promote integrity and transparency in the security and defense sectors.
From the 17th-century tulip mania in Holland to the tech bubble in the late 20th century, economic bubbles grow rapidly and grow large when transparency wanes.

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