Uniform international accounting standards must be developed so capital may flow freely across borders, Citicorp chairman and chief executive John Reed said Monday.
"Investors need a common understanding across markets," Mr. Reed told the Walllenberg Bankers Forum at Georgetown University. There can't be "massive differences" in the way the same company reports its financial results in different countries, he said.
Common standards are crucial because the developed world is poised to invest substantially in developing countries such as China, India, and Latin America, he said.
With common accounting standards, savers in the developed world would be willing to invest in these countries because they offer higher returns, according to Mr. Reed. Individuals aged 40 to 55, he said, are saving more because they realize that they can't rely on government programs and company pensions to support their retirement.