The Naked Corporation: How the Age of Transparency Will Revolutionize Business.

The Naked Corporation: How the Age of Transparency Will Revolutionize Business. By Don Tapscott and David Ticoll. Free Press, 349 pages. $28.

Newspaper headlines. Internet sites. Cable television bulletins and instant analysis. Let's face it, in this era of real-time, worldwide communications, there isn't much place to hide, especially when a company may indeed have something it doesn't want to disclose.

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In The Naked Corporation, Don Tapscott and David Ticoll, authors of Digital Capital (2000), review the societal and cultural changes that brought us to this station, and discuss their far-reaching ramifications. In detailing the consequences and the ensuing debate, they use telling examples from dozens of companies in a wide variety of industries; not surprisingly, names like Enron and Arthur Andersen surface as billboards for what not to do.

The book is divided into three basic parts: establishing the emergence of transparency and emphasizing its importance; exploring the various stakeholders--customers, employees, investors, business partners--and their interplay with a company; and a conclusion stressing the importance of "being open."

"In the networked economy, transparency cuts to the center of vast, newly controversial and urgent topics like leadership, trust and sustainability," they write. Customers, employees and institutional investors are being empowered as never before, and "to collaborate effectively, companies and their business partners have no choice but to share intimate knowledge with one another."

Obviously, that isn't easy, and it may be actively resisted. The result, the authors say, can result in a "forced transparency"--such as a trade union campaign against Fidelity Investments that asked it to reveal how it voted in key proxy matters at some companies where it was a major shareholder. While such disclosure has been actively fought by Fidelity and other major mutual fund firms, it has won the support of the Securities and Exchange Commission.

In this altruistic and persuasively argued book, the genie is out of the bottle, and companies need to adjust to the higher information demands and transparency that various constituencies are clamoring for. Better "optics" can clarify issues or answer unasked questions, the authors write, quoting Samuel Johnson that "when secrecy or mystery begins, vice or roguery is not far off."

Using almost no graphics but a wealth of effective examples, The Naked Corporation wears its idealism like a badge of courage--and puts the responsibility for leading change directly in the laps of chief executives, most of whom, the authors say, "are still locked into the old view." This change is sometimes slow and acrimonious, but it seems inexorable, and Tapscott and Ticoll's message is unwavering:

"Firms that embrace [transparency] and harness its power will survive. Those that ignore it or oppose it will suffer ... Firms that exhibit ethical values, openness and candor have discovered that they can better compete and profit ... Today's winners increasingly undress for success."