The Transparency Trap

Guest Contributor: Jane Conway, Ph.D., Chief Information Officer, Infonic AG

Nearly 30 years ago, a US President said, “Information is the oxygen of the modern age.” While that statement is perhaps even more appropriate today, there’s an important impact to consider. Just as oxygen can be deadly in too small or too large a quantity, having too much information can be just as perilous as having too little. The question is: where is the defining line? What is the right information?

In the post-Madoff, post-Volcker rule era, the alternative investment world has moved quickly to accommodate investor demands for greater transparency. The resulting flood of information is creating a new set of problems for investors; specifically, what and how does all of this information affect the investor’s goal of identifying, monitoring and managing the risk of their investments?

So when does transparency go from being instructive to destructive?

To me at least, it seems we are already close to crossing that threshold. Many service providers are so consumed with measuring themselves and their peers by the volume of data delivered to clients that they lose sight of how the data must be organized and transformed into INFORMATION that is relevant to the needs of consumers (e.g., investors, regulators, leverage providers, etc.). It is easy to forget that data must be gauged in terms of quality, not quantity, as even the most critical pieces of information are useless if not presented in an understandable, relevant and actionable way. Successful companies will be those that best organize the information they provide, facilitating the various decision-making processes confronting their clients on a daily basis.

So where does that leave us now?

It’s a good question, and one I’m not sure anyone can confidently answer. Each information consumer has a different set of needs and requirements, so now more than ever it is imperative for information providers to partner with their clients to create relevant information delivery solutions that provide real value.

In an effort to assess the informational needs of investors and managers in the alternative space, Infonic has been conducting a detailed survey in conjunction with Stone House Consulting. The study addresses topics such as operational risk management, pricing, transparency, valuation, and a host of other important issues.

To participate in this survey, please click the following link (http://www.surveymonkey.com/s/QBM5G5F). It takes about 10 minutes and, as extra incentives, all respondents will receive a summary report of the survey results and will be automatically entered to for a chance to win a Flip video camera.

About Maureen Lowe

President and Founder of Financial Technologies Forum, LLC. Editor-In-Chief of FTF News. Entrepreneur, Jersey Girl that recently returned to Jersey, Loves to Bake, Married to a Kiwi, First Time Mom
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