I Can See It: A Transparency Metric

My winter-vacation reading was heavy on risk management, probability and behavioral economics. I dug into Leonard Mlodinow’s “The Drunkards Walk: How Randomness Rules Our Lives,” the Brafman brothers’ “Sway: The Irresistible Pull of Irrational Behavior,” and Peter Ubel’s “Free Market Madness: Why Human Nature is at Odds with Economics and Why it Matters.”

I also look forward to reading Joe Nocera’s The New York Times Magazine cover story (“RISK!”) that examines how the mathematical models used to evaluate Wall Street trades (or the bankers who misread those models) caused the financial meltdown.

The allure of this content is both professional and personal. I scour behavioral-economics and risk-management content for clues as to how I can continue to crush Realtors, IT executives, consultants and other writers (by far, the easiest marks) in our weekly neighborhood poker games.

What strikes me as I continue to absorb these ideas and lessons as a GRC writer (and extremely amateur poker player) is that so much seems to be converging in the area of risk. Experts always talk about risk and opportunity occupying different sides of the same coin – but transparency also plays a crucial role. Perhaps it describes how and why we decided to flip the coin in the air in hopes of achieving a desired outcome.

There has been much talk about risk metrics in recent years. Heck, companies are even beginning to report sustainability metrics (as my poker opponents from Dell can attest to) – with mixed results, so far. Why isn’t there more discussion about a transparency metric – one that measures how easy a company’s finance and accounting story is to follow? The measure would evaluate how the story is told as well as how the performance was constructed.

If you have any transparency metric ideas, approaches or content that excites you, please share them with me.