GoingGlobal 189For investors, U.S. corporations disclose far more than do those
in Europe or Japan. U.S. federal and state law, as well as stock
exchange rules and general market pressures and expectations in the
United States, result in corporations disclosing extraordinary
amounts and types of information. Other countries impose more
limited and far less effective disclosure requirements.
As global corporations as diverse as DaimlerChrysler and SAP
increasingly list shares on U.S. stoc kexchanges and stoc kexchanges
around the world, they will find themselves subject to U.S.-style dis-
closure requirements as a matter of both regulatory mandate and
market expectations and demand. As the same group consummates
cross-border transactions requiring the disclosure and evaluation of
information, pressures toward uniform disclosure requirements will
emerge in a wide variety of settings. In fact, participants find that
U.S./U.K.-style information disclosure is consistent with existing
corporate traditions in most countries, most notably Germany. Ac-
cordingly, broadening global corporate laws to require such disclo-
sure seems quite possible.
Public regulators have undertaken just such an effort. The SEC
is working with the International Organization of Securities Com-
missions (IOSCO) to develop a set of international standards for
nonfinancial statement disclosure. These efforts are intended to fa-
cilitate cross-border financing and listing by transnational companies
while holding them to a single global standard of disclosure. The
IOSCO issued new rules about certain kinds of cash transactions
and offerings and listings of common equity securities and is working
to extend them to tender and exchange offers, business combina-
tions, privatizations, and other affiliated deals.
High-quality information is essential for intelligent investing in
the modern global marketplace. Ignoring the garbage and disinfor-
mation piling up on the Internet is becoming increasingly difficult
as more countries develop information-based corporate and investing
cultures and as more citizens of those countries learn the ropes of
the systems.
Two-Way Street
Not all these trends run one way, for the idea of shareholder primacy
in the United States was gradually but substantially eroded by the
dramatic reallocation of corporate value from shareholders to work-