1. Introduction
Transparency is an omnibus concept and can be used in virtually all aspect of human endeavour. Transparency is operating in such a way that it is easy for others to see what actions are performed. Transparency is further opinionated to be the perceived quality of intentionally shared information from a sender. For instance, a cashier in a named organization giving out a balance to an esteemed customer after transaction offers a record of items purchased in the form of receipt. This demonstrates transparency. In fact, transparency is one of the ethics of an organisation and as such, the management, the workers, and every stakeholder in such an establishment are expected to be transparent in all their dealings to ensure the overall success of the organization Corporate Transparency
Corporate transparency describes the extent to which a corporation’s actions are observable by outsiders. Employees need to see what is happening at their organisation, yet that is not obtainable. Most persons fail to understand the organisation’s goal, know how the company is doing or the challenges the organisation is facing.
2. Types of Transparency
a) Internal transparency: this is a measure of how open a company is with its employees.
b) External transparency: This is a measure of how open a company is with its Customers, partners, shareholders, and the public.
3. Corporate Transparency
Corporate transparency describes the extent to which a corporation’s actions are observable by outsiders. Employees need to see what is happening at their organisation, yet that is not obtainable. Most persons fail to understand the organisation’s goal, know how the company is doing or the challenges the organisation is facing.
4. Types of Transparency
(i) Internal transparency: this is a measure of how open a company is with its employees.
(ii) External transparency: This is a measure of how open a company is with its Customers, partners, shareholders, and the public.
5. Importance of Corporate Transparency
Transparency can greatly improve productivity in business, employee morale, and company’s culture and most investors sort for organizations that are transparent for security purpose. So therefore the need to keep the work process transparent to everyone is vital to everyone.
The importances are itemized below:
• Transparency brings assurance:
When financial statements are not transparent, investors can never be sure about a company’s real fundamentals and true risk, so, transparency boosts the confidence of the investors.
• Blurring vision:
Transparency exposes and projects the vision and mission of an organization with a view to drawing the attention of the customers and /or investors. It gives investors the information that they need to value their investment.
• Transparency pays:
Research shows that the market gives a higher value to firms that are upfront with investors and analyst. According to Robert Eccles, companies with fuller disclosure win more trust from investors.
• Consumer trust:
Consumers trust companies that are open and truthful with them, just as they trust family members and friend who do the same.
• Positive public perception:
A transparent approach to business shows the public that you have nothing to hide. This is especially effective when your operations include open, straightforward communications via your publicity department, being upfront rather than spinning corporate information, even if the information is not favourable, demonstrates integrity.
• Image management:
Being open and transparent allows you to manage public perception of your company. If crisis arises, you will have established channels to disseminate information. This positions you to release information in a period that is beneficial to your organization, allowing you to manage even the most difficult of all situations.
• Respect:
Operating a transparent business demonstrates respect Operating a transparent business demonstrates respect for employees and customers alike. When outsider have the opportunity to see and understand how you business operates behind the scenes and processes that are involved in all of your business operations. They are more likely to have respect for your company. This is especially helpful for non-profits organizations, which are entrusted with donated funds.
• Transparent reporting of revenues and expenditures from the private sector will help bring illegal flows of income under control.
• Employee commitment and innovation:
Transparency in business makes it possible for employees to see where the business is striving and areas of weakness. This goes a long way to bind employees closer to the goals of the organization.
• Problem solving:
The point of transparency is not only to identify, but also to provide solution.
6. How can organizations/companies be more transparent in their operations?
• Align customer’s expectation with reality:
One of the quickest ways to drive your company into ground is to promise what you cant deliver. Always assume that your clients and customers will share their experiences with other, so align their expectations before they engage your products or servoces
Transparency means telling the truth about your organization, your goals, your products, and your services. Do not attempt to lie about what you can do and what you can’t do, because that will greatly affect your credibility.
• Nurture a culture of open feedback:
As an employer or a manager, encourage your subordinate to ask you anything, so that they won’t guess or assume your thoughts or intensions concerning any issue that needs attention because it is very bad to make decisions based on assumptions. Also endeavour to build a client relationship on a foundation of mutual trust.
• Share news with employees:
Share news with employees, be it good news or bad news, rather than attempting to keep it a secret, this is because in the absence of tangible information, rumour can be spread and this can spread unnecessary anxiety and uncertainty among the employees.
• Improve the quality of their report:
Organizations need to focus on the quality of their data, and also improve on their non-financial reporting to meet both future regulatory and investors requirement.
• Communication:
Equally important is communication, engagement, and organizational readiness. It is important to ensure that reports with relevant stakeholders and that they act as conversation starters. Companies also need to ensure that stakeholders who work directly with various departments in the organization are properly trained and able to communicate the salient points in their report to their stakeholders and interested public.
7. Conclusion
Transparency is a key driver of corporate reputation, but it is also an area in which many organizations commonly under-perform. There is increasing external and internal pressure from organizations all over the world to become more transparent, not only from stakeholders but also from customers, employees, media, regulators and investors. Transparency makes analysis easier and this debilitates investors’ risk during investment. Organizations are therefore encouraged to imbibe the culture of transparency in their dealings with everyone who they do business with.
Cynthia Dare
Research Assistant
For: Institute of Attitudinal Change Managers
Didio Plaza,
No. 66, Oko-Central Road G.R.A, Benin City, Nigeria.
Website: www.iacmng.org
Phone Number: 08165386825, 08186681577.
Email: info@iacmng.org or iacmng@gmail.com
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