Thank you very much, Okawara-san, for the kind introduction and for acting as my marketing manager, and thank you all for doing me the honor of having me this afternoon and helping me to return to Japan where I lived from 1983 until 1986, and which I continue to think of as my second home.

My job this afternoon is to give a personal perspective as a financial journalist, or economic journalist, as well as the professional perspective of an editor of a weekly magazine, which happens to be sold in every country in the world, and therefore has a  very international professional perspective.

What I´m sure you all realize is that journalists, including economic journalists and international journalists, are quite awkward people. We don´t really behave very well. We have beards. We don´t comb our hair. We are outsiders. We often ask awkward questions. We write articles that people don´t like, if they are the subject of the articles.

My argument to you this afternoon, in this context of corporate governance and disclosure, is quite a simple one. It is that I want to try to persuade you to take the view that although we are awkward, although we are outsiders, we are actually extremely useful outsiders. We are useful to companies because we are outsiders and, therefore we have an independent view both about the outside world and about the company we´re writing about. But we are also, and this is important, most useful to companies when we are, in fact, highly independent outsiders. A vital point about being a journalist, particularly I think a financial journalist, is that it is very important to be independent, it is very important not to become too close to the people and the organizations that you write about, whether they are governments, or companies, or just celebrities. It is very important, if you like, not to have any friends among the people that you write about. Personally, I find it very easy not to have friends, but it is very important to be separate from the subject you´re writing about, and I would suggest that the second part of my simple message to you, is that journalists, the media, are also more useful to you as corporations if they are not your friends, if they are independent of you. They are better outside rather than being brought inside.

So this is my simple message. Let me elaborate upon it a little bit.

My elaboration of my view of the role of journalists in corporate governance and

disclosure begins with the point that it is the duty of the media, the duty of journalists to provide our readers or viewers with information, with analysis, and with, frankly, entertainment. We hope to make our readers think, but also hope to make them enjoy the process of thinking as well as hope that they understand the world better.

Secondly, of course, as I have already implied, this role of having a duty to the readers produces a psychological reality about journalists as outsiders producing their stories on behalf of readers and not companies or governments. Journalists are, or should be, naturally suspicious or skeptical people.

At a conference in South Korea that I attended this weekend, a German businessman, in one of the panels, described the media as, and I quote, "people who seem to wish to make life difficult for politicians and executives". He meant this as criticism; but I consider it to be praiseworthy. Although, of course, with my type of magazine, it´s worth pointing out that while we try to make life difficult for politicians and executives, also many of our readers, perhaps even most of our readers, are executives and politicians themselves.

The third point that is worth saying though is that when we write about companies and about business in general, we have a lot of different purposes in our mind. The controversy over scandals that Dr. Crist talked about, Enron or WorldCom, or in other countries, Credit Lyonnais in France, or Snow Brand in this country, or Mitsubishi Motors, these controversies, and the current concern about corporate governance might imply that journalists are only interested really in writing about dishonesty and wrong-doing. It might imply that we see ourselves as a kind of investigator, or detective, but that isn´t true. It is one of our interests, but it is only one of our interests, and it is not actually our most important interest.

Our most important purposes, as financial journalists, are that we want on behalf of our readers to explain what companies are doing, to tell stories about their successes and their failures, to compare their performance with that of other similar companies, and, above all I think, to find lessons for managers and investors. We want to understand the business and the company; we want to know about the people and the organization. We want to find out about the quality of its products, the type of ideas that the company has and the type of management that is in place. And of course, we want to have a sense of how well, or badly, the company is doing. You may well think, when I´ve given this great long list of things we want to know about, that we want to know too much, that the journalists are people who get in the way of process of business, rather than someone who is useful. I want to convince you that that´s not the case, that actually we are a

helpful pressure point on companies.

But first let me explain a little about this process. Just as corporate governance is not a new phenomenon, and just as there is no single set of principles about corporate governance, really there is no panacea, there is no simple solution in management in general and so the important thing to understand as a journalist about companies is that they are very, very varied in their type. They are different when they are private companies from when they are public companies. They are different if they are run by entrepreneurs from when they are run by managers. They are different when they are big from when they are small. And they are different when they are domestically oriented companies from when they are very international companies. In my experience, this is true within countries just as it is between countries, and that actually the variety of types of companies is the same all over the world. When I was stationed in Japan writing financial journalism, I found just as much variety in the approach and nature of Japanese companies as I did in Britain or in the United States. One should not, I think, look at countries with national stereotypes in mind.

What, then, matters to journalists in terms of disclosure of information, and the approach of companies to journalists? Well, we would say a few things. First thing to know about journalists is that we are, of course, very busy. Editors, and I´m sure my staff agree with this, editors are demanding and often unreasonable people. This means that journalists operate in a hurry. One consequence of that is that journalists, though they are suspicious people, they actually tend to want to trust what they are told. They´d rather start by assuming that information they are given is accurate. The importance of that observation is that once journalists find that the information they are given is not accurate, or that they have been told things that are not true, then their trust is completely broken, and they tend then to run to a completely opposite judgment.

As a journalist operating in countries around the world, I have often found that I have been given false information. The result of this is that the organization or company that has given me this information is immediately, and probably for a very long time, an object of great suspicion. It´s hard to re-build the reputation once you´ve lost it.

Secondly, we want consistent information, we want information to be in the sort of form that we are able to analyze, to explain how things have changed; we want information to be comprehensible and comparable. Countries do vary in this, in my experience. In the United States, there is, of course, a lot of disclosure of information. SEC filings, quarterly reports, analysts´ reports based on information given to them by companies, and reports and studies done by the companies themselves. Often one feels as a journalist that one is swimming in information. What we now know, or what we have been reminded about by Enron and WorldCom cases, is that the quantity of information is a different matter from its quality; that even if there is a lot of information it can be dishonestly provided.

Companies do vary a great deal. Enron did provide quite a lot of information and was, in many ways, quite open to visits by journalists and interviews by journalists. Some other companies, like Proctor&Gamble for example, are rather closed; they don´t like visits from journalists, they try to keep journalists away. Other companies, in my experience, disclose full information, and then don´t like it when you write about that information. We recently wrote an article about Goldman Sachs in The Economist, about the disclosure of a new compensation plan for their executives, based entirely and perfectly accurately on their filing to the SEC, and they were very angry with us for doing this. It was almost as if they were outraged that somebody should have actually read the information they had disclosed. So things do operate in confusing ways.

In Britain, too, I would say there is less disclosure, quite a lot less disclosure; there´s more secretive behavior, use of nominee companies, but generally a culture of accessibility to journalists.

Some things become obvious with the benefit of experience. The media is part of the problem; that´s one of the things that´s obvious. We like personalities, we like chief executives that are prominent, but actually the prominence of the chief executive is often an indicator that something may be going wrong with the company, perhaps because they are too focused on the celebrity and too little on the company. We as media often help to create interest about the awards, prizes, given to the chief executives, to marketing directors and finance directors; in fact, experience suggests that rankings in the Businessman-of-the-Year awards in different countries are often a very good clue as to which of the companies are soon going to fall into trouble.

I also find that the sort of complaints one receives after an article has been published are quite revealing; they are often as revealing as the interviews that take place. I shall never forget a complaint that I received when I lived in Japan from what was then the Japan Tobacco and Salt Public Corporation. I had written a short article about their competition with foreign cigarette companies and they called me back to the company. There, they they showed me my article I had written which they had cut up into separate sentences from the magazine and which they had pasted on a big piece of paper. There they took me through every sentence, trying to argue as to why I was wrong. This actually convinced me that I was right and, therefore, I felt they told me more about the company than I could have found out any other way.

I´m currently in a legal case in France with the Credit Lyonnais bank; their Chairman has sued me for libel. I shan´t comment on the case because the verdict hasn´t come through yet, but one thing that´s interesting about the case is that the question in the article (which is about a scandal at Credit Lyonnais has to do with an American insurance company that the company bought), the question, really, the issue is whether the Chairman of the company knew about this scandal, or as we said, whether he should have known about it. And one thing that´s revealing about the way the company was run in those days is his defense as a witness in the court case a few weeks ago. His defense was essentially one of incompetence; his argument, quite honestly and straightforwardly put, was that actually he did not know about the scandal because he was too disorganized to know about this scandal. As I say, what the verdict in the court case turns out to be I cannot speculate upon, but this also told me a lot about the company.

What are my conclusions? Generally, of course, we write about corporate governance and in writing about corporate governance, we feel that accountability and independent scrutiny are the important things, as Dr. Crist said. We feel that there is no simple system, there´s no guaranteed rule. We feel, though, that in terms of disclosure of information, it is better to be full and open about information, but also consistent with information. I say that, although there is really a choice for companies, I think, a choice for companies either to be very, very open, to give out a lot of information, to be very accessible to interview, or I think to be very closed, and not provide a lot of information.

 My experience and observation is that both of these two choices are quite practicable and possible choices, but the middle path is not a very good choice. Giving a little information, just giving some information, providing some access, is not usually a good choice. It is better to be very open, or to completely keep the press out.

But finally, and I repeat really my simple point in this short amount time available, is that journalists are difficult people; we are nuisances to companies. But we are also, I believe, part of the process of independent scrutiny, of checks and balances that is part of the process of corporate governance. We are useful to outside investors, because we are doing the same job as they are doing trying to understand the company, but we are also, I think, useful inside the company, to managers, because we are an indicator of what customers may think, how they may react; we are an indicator, certainly, of what investors may think, we are an indicator of what public opinion, in general, may think, we are an indicator of how a company compares to competitors, we are an indicator of how company looks on a global basis.

We are certainly not perfect in providing this information, this check and balance. We are amateurs, we are often not expert at all, but we are people whose actions can be used and learnt from if the company is willing to provide information, to disclose information and to be open. I found as an editor during the process of coming up towards the war in Iraq, that the letters and emails I was receiving from the readers were very useful. I was taking a very strong position arguing FOR the war in Iraq, and most of the letters I received were critical, they told me that I was wrong, that I was mad, that perhaps I was on the pay of George W. Bush. Serious letters, of which there were many, were very helpful to me in formulating my own arguments, in helping me understand my readers, in helping me understand my own market.

I believe that good managements, good companies can and should try to use journalists as independent critiques, as independent examiners of the company, and then be able to learn from our reactions, learn from our analyses, learn from our inquiries. You cannot do so if you seek to control journalists, but you can, and you must also, be tolerant of journalists. But if you are those things, I think I may say humbly that we can be useful, even if we are often awkward and difficult people.

Thank you very much.for taking the time to listen.