As investors in the U.S. and around the world parse through the newly released second-quarter earnings reports of many of the largest global companies, headline stories like the $4.9 billion wallop taken by Boeing over its 737 Max serve as a valuable reminder of just how important this reporting is. In a healthy market, customers, and investors need reliable information about what they're buying and where they’re investing in order for the invisible hand of the market to operate effectively.

That’s why reporting by publicly traded companies, even under flawed rules like the ones currently governing the U.S. market (and which President Trump is pushing the Securities and Exchange Commission to fix), is an invaluable vehicle for the market to regulate itself without the need for government interference.

This is a fact private equity firms already understand well, which is why taking companies private -- as Blackstone did with Hilton from 2007 to 2013 and Dell undertook from 2013 to 2018 -- is usually a temporary solution for restructuring and reforming firms in need of a shakeup. Indeed, Blackstone’s 2018 exit from Hilton netted the private equity firm $14 billion while leaving the once-struggling hotel chain on far sounder footing, while Dell announced its conversion to Class C common stock on the New York Stock Exchange that same year.

Unfortunately, not all companies demonstrate this same level of forward planning and commitment to transparency in the market. One of the most recent examples of this is the indefinite privatizing of Sotheby’s. The auction house was the only major one in its field to be publicly traded, but a new merger agreement coming into effect this summer will put an end to that.

This is a wholly unfortunate development for the art world, because Sotheby’s reporting has thus far offered an important level of visibility into an already opaque global art market. Sotheby’s itself has helped demonstrate why investing in the art world is so fraught, thanks especially to an ongoing legal case involving the auction house, billionaire Russian art collector Dmitry Rybolovlev, and Swiss art dealer Yves Bouvier.

According to a $380 million lawsuit brought by Rybolovlev against Sotheby’s, the action house colluded with Yves Bouvier to defraud him to the tune of over $1 billion over the course of his purchase of 38 artworks from the embattled Swiss art dealer, who is also the mastermind behind “Fort Knox”-style freeport facilities in global tax havens like Luxembourg and Singapore. Emails between Yves Bouvier and Sotheby’s vice chairman Samuel Valette, newly released as part of the case, seems to show the auction house actively working with Bouvier to help him engineer massive markups in the prices he communicated to Rybolovlev.

Given that kind of history, one would think art market investors would be clamoring for more insight into what’s going on at auction houses like Sotheby’s, not less. Instead, with the company going private, art investors will need to operate on blind faith alone... or find a more forthright place to put their money.

Of course, the temptation to ditch the demands of investors and go private has reared its head across plenty of industry sectors. Elon Musk made himself the poster child for this kind of thinking last year, when he infamously took to Twitter to muse about plans to take Tesla private, igniting weeks of accusations and speculation before Musk backed down. How did Musk plan to take his $60 billion company off the market? With the help of Saudi Arabia’s sovereign wealth fund.

The fallout from Musk’s announcement was particularly intense and, despite a swift reversal by the CEO, piqued the interest of the U.S. Securities and Exchange Commission (SEC). Why? Because Musk’s claim that he had “funding secured” was not true and carried serious risks of misleading investors. Musk was forced to agree to a $20 million fine over the outburst, as well as to step down as chairman of Tesla’s board and get approval for all his future communications relating to Tesla’s shareholders. Since then, Musk has repeatedly defied the SEC both on Twitter and in court, making it all the more important that the investors holding stock in his companies have a clear window into what’s happening under his watch.

Musk’s competitor in the private space race, Richard Branson, has taken a different route, last week announcing plans to list Virgin Galactic as a public company on the New York stock exchange. Like Musk, Branson’s aim is to provide the first-ever commercial passenger flights in space. The tycoon views a public listing as the key to opening this next frontier, with the deal expected to “open space to more investors and thousands of new astronauts.” While Branson’s strategy is more commercial than idealistic, the need for public reporting is tied to the long-term interests of the entire market.

That said, American reporting requirements can certainly stand to be made less rigid and dogmatic, as President Trump proposed to do last year by changing the mandatory reporting period from three months to six. All said and done, the investment markets can’t function properly without them. The President’s move has earned widespread support from the business community, and for good reason: U.S. financial reporting is one of the rare areas in which European rules, which require only the bi-annual reports the Trump administration suggested last year, are more flexible than those on this side of the Atlantic.

Trump’s proposal, which is currently under consideration at the SEC, has the benefits of letting listed companies focus more on long-term goals, and less on trying to maximize short-term earnings for their shareholders. If he manages to push it through, Trump will be able to claim a major win by freeing America’s most successful companies of an onerous load of paperwork, all while making sure investors still have the information they need to make sound decisions.