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Transparency means different things to different people. Some organizations may believe they are transparent, when in fact, employees and the general public believe the opposite. No matter what an individual believes about transparency, the concept is universally rooted in trust.

Unfortunately, over the last several years, many corporations assured their employees, customers, and the public that they were trustworthy, even as they improperly allocated funds, took advantage of loopholes, and made decisions for the benefit of a very elite few. As a result, the public no longer assumes corporate trustworthiness, instead, consumers and investors require that organizations prove themselves through open communications and transparency.

Building Transparent Leaders

A transparent organization is made up of transparent leaders.
Companies develop the policies and systems that allow for the free flow of information, but it is up to leadership to insure that information is being shared.
Some of the characteristics of transparent leaders include:
  • Honesty
  • The ability to ask for and accept constructive feedback
  • Delivering bad news with compassion
  • The ability to say you're sorry
  • Admitting mistakes

Just as transparent leaders bring the policies and values of the organization to life, they can also be the motivators of change in companies that have yet to adopt transparent policies - one of the key elements of transparency accountability. When leaders own up to their individual mistakes and take ownership of problems within their own departments, their direct reports will sit up and take notice. They, in turn, will begin to trust a little more, and they may also begin to mimic their behaviors, spreading a commitment to accountability organization-wide.

Building Organizational Transparency

Organizational transparency begins at the top. Unless top-level executives, leaders, and board members buy in to a culture of transparency, the company cannot hope to achieve it. Traditional models of corporate communication involved the management and often hiding of bad news. Leadership would typically only share information with employees on a "need-to-know" basis. But a tight-lipped mentality doesn't work well in an era of social media, where news (good, bad, true, or untrue) can spread globally in a matter of moments. Organizational transparency often begins with a commitment to open communication. But communication itself does not equal transparency.

Organizations must foster an environment where the workforce is engaged and productive. Social Media tech company Buffer utilizes transparency to gain a competitive edge in the marketplace. In a recent piece for Fast Company, Buffer's Leo Widrich outlined his company's policies on transparency. At Buffer, he says, every employee has complete access to everyone else's task lists, project status, compensation package, and even their sleep and exercise habits. Says Widrich of the policies:

"Everyone on the team...shares what they get done every day, with a twist. In addition to sharing daily learnings and progress, everyone on the team also shares where they struggled and how they're trying to improve. We envision a company where people are treated as full human beings, not productivity automatons, with a complex set of motivations and aspirations. Our team inspires and shows us how openness about vulnerabilities leads to greater collaboration, trust, and personal growth."

Overcoming The Fear of Information

Organizational transparency is driven by leadership, as well as by systems and policies that allow information to flow smoothly. Transparent leadership, on the other hand, is more about behaviors than systems or policies. The relationship between organizational and leadership transparency is symbiotic: it is hard to have one without the other.
In order for leaders and organizations to move toward transparency, they must conquer the common fear of "bad" information. But owning up to mistakes and presenting immediate solutions can avert PR nightmares, and can even build trust among customers and employees. As the demand for transparency continues to grow within the workforce and the general public, senior leaders will have to adapt their policies and systems to meet that demand. Those who embrace and integrate transparent principles will see strong returns in public sentiment, customer relations, employee relations, and profits.


Larry Hart

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