The current Asian economic crisis highlights the need to strengthen organizations such as Berlin-based Transparency International which foster fair business practices, better business ethics and stronger laws against corruption, according to Solon Patterson, chairman of the Atlanta investment counseling firm of Montag & Caldwell.
During a telephone interview with GlobalFax last week, Mr. Patterson commended the efforts of the Southern Institute for Business and Professional Ethics, an Atlanta-based non-profit organization, for developing a working group locally to monitor international efforts to eradicate bribery in business dealings.
When you have upward momentum in an economy, you can cover up a lot of sins that come to light when things turn the other way, he said.
He criticized the lack of reliable information about companies in several Asian countries, and called for more stringent accounting methods which would provide investors with more information on which to base their investment decisions.
Among the Asian countries which he follows, he said that he is most apprehensive about China, which although has the greatest potential is hampered by heavy handed interference of the government in its economy. A crackdown by China’s government on the country’s nascent industries would result in the loss of investor confidence in Hong Kong as well as the mainland.
Companies such as Ericsson and Coca-Cola, which have large investments in China and elsewhere in Asia will mange to compensate in other markets, particularly in a stronger Europe, he added.
Mr. Patterson may be reached at (404) 522-5774.