Anthony Malakian: The Nature of Privacy

As this issue of Waters was going to press in late February, I was preparing to attend the two-day TradeTech conference. TradeTech, like other industry conferences—including those run by Waters—aims to bring together financial technology leaders to discuss, debate and help generate new ideas that will allow firms to improve their overall technology and address regulatory challenges.

Two days before the event, I received a note from TradeTech organizers informing me that about a dozen panels would be closed to media. As a journalist, I was disappointed that conversations on regulatory updates, high-frequency trading and numerous other technology-related panels would be conducted—to borrow a term from block trading—“in the dark.”

The most cited reason for a total media blackout or for requiring that quotes not be attributed is that it allows speakers to have a more open and honest conversation. Safe in the knowledge that they can’t be held accountable for their comments, speakers are free to hype products, slam competitors and make self-serving or even false statements. 

Annoyingly, journalists are increasingly being forced to deal with off-the-record, non-attributable interviews, a phenomenon that has become increasingly prevalent thanks to publications like The New York Times, the Financial Times, The Wall Street Journal, and The Economist. When consumer titles set that standard, it spreads to all, including B2B specialists like Waters.

Minimizing the Blast Zone
I’m currently researching a buy-side risk management feature, and almost all end-users I’ve approached for quotes insist on anonymity. Their insight is valuable, but it also lacks the impact it could have with a name attached to it. For them, sticking their necks out is risky business. But conferring off-the-record status on a panel discussion at an event doesn’t exactly fit that bill, where typically there are hundreds of people in attendance. Conference organizers can bar everyone with a tape recorder, but those who do attend—people who work at competing buy-side firms, for example—are free to return to their funds and use the information gleaned. The off-the-record status simply reduces the blast zone. But if you are limiting that sphere of influence, what’s the point of the panel?

If you cannot be honest with an opinion at a conference or when talking to a reporter, why should an investor put stock in anything you say?

Conferences are all about thought leadership. If those thoughts are being contained to a few hundred people, is it really useful at all, or just a money grab? Like it or not, the media plays a significant role as a conduit through which those ideas spread. Maybe journalists are barred because there’s a general distrust of the media? Or fear that we’ll misrepresent what was said? That can happen, but I’ve found that in almost all instances, people are unhappy with the way their words look on paper, even though they weren’t misquoted. After all, it’s rare to get a quote wrong when everything that was said is on tape.

One prominent buy-side CTO I know, who has spoken at our conferences in the past, says that he has heard from his bosses about some of the honest things he has said during panel discussions. As a result, he’s a bit gun-shy. But here’s the thing: The thoughts and opinions expressed at these events are vital to advancing efficiencies and improvements throughout the industry. In that respect, the media serves as the megaphone for those who couldn’t attend.

Good for All
The sharing of ideas and information when it comes to risk management, cloud, regulation, mobility, trading platforms, and so on, nourishes the industry, which is good for everyone. We’ve witnessed a number of technology glitches recently, which have undermined investor confidence and turned up the heat from regulators. At the risk of sounding patronizing, honest, open, two-way dialogue between the media and technology end-users helps to improve transparency and fosters innovation. If everyone holds all their cards to their chest, no one wins.

If you cannot be honest with an opinion at a conference or when talking to a reporter—where your words can be scrutinized—why should an investor put stock in anything you say? If you hadn’t noticed, trust isn’t exactly at an all-time high in the industry today.