It’s a cultural thing

Abstract

A few months ago, I conducted a small experiment. I sent out emails and faxes to over ten companies in the GCC, asking the investor relations officers to reply with information on their disclosure policies. I wanted to see how many would send me what is widely regarded as public information. I got exactly one response, and it was the wrong one. The officer sent me his company’s brochure. The experiment was a total failure. But it proved something that I and many business journalists already know: companies in the GCC, especially private and government-owned corporations, are not forthcoming about their company details. This can include anything from earnings statements, to information on layoffs, new hires, or, as I discovered, their guidelines on what data – if any – to make public. As a business journalist, all I need are numbers and the occasional interview to write my story. Without them, I’ll have to rely on rumors, outdated information or one of the press releases that flood my inbox to write on the UAE’s companies. Or if I’m lucky, I can rely on a friend who’s willing to leak information about her company in exchange for a free dinner (seriously). But getting a hold of figures is a problem. And while some say it’s only a transparency issue, I disagree. It’s also a censorship issue, albeit an indirect one: companies’ lack of transparency means they don’t need the government to censor business news, because the necessary information isn’t available in the first place. Journalists, then, rely on rumors. And as one PR executive at Nakheel told me a few years ago, local companies don’t respond to rumors. In fact, local companies respond to very little. They have a culture of keeping quiet about big news, including arrests, layoffs and the cancellation of major property developments. But there's only so much negative news they can hold back from the public, especially now during the financial crisis, when the "Dubai dream" appears to be frying in its own oil.