Transparency Policy: The Why & How of Building One that Works for Your Organization

“Transparency” seems to be the word of the day. In today’s world of corporate shenanigans and frustrating bureaucracy, there is a solid case to be made for transparency. Transparency policies at Buffer and Netflix have been much written about, as they are keeping their culture, and their salaries, out there for the world to see.

Proponents of corporate transparency say it can lead to improvements, innovation and can foster a deeper sense of trust with employees and shareholders. For Buffer, that means publishing all the salaries it offers to employees around the world, and the calculations it does to arrive at those amounts.

But transparency means different things to different people. On one hand, from a compliance standpoint, a position many HR professionals are the most comfortable with, it means that a company will provide full, accurate and timely disclosure of information, mainly to the company’s shareholders.

On the other hand, for HR in particular, this can create as many issues as it can solve. In a study done by the University of Nottingham, VU University Amsterdam and Erasmus University Rotterdam, researchers found transparency can inhibit decision making. In a game show environment, one group of contestants participated on a lab computer, while the other group competed in front of a host, audience and cameras.

They found a more transparent atmosphere increased the fear of losing, causing them to play it safe in situations where risk may have been a benefit. Some employees may not want the spotlight that transparency can encourage, inhibiting innovation and ideation. It’s important to strike the right balance of workplace transparency, especially in industries where some element of risk-taking is necessary, like sales or finance.

There are other ways to “grow” company transparency without giving a full disclosure of information and, in turn, causing yourself more problems than necessary. Some suggestions include:

• Internal communication with a modern twist. Slack, WeChat and Facebook for Work are making inroads in transforming the way remote workers communicate. The platforms improve interaction, give employees a steam valve, help cross-departmental innovation and seem to fulfill the social needs that a “Macbook and headphones” workplace can bring. We implemented Slack at ClearCompany 3 years ago, and have used it to ease a few growing pains. It not only provides easy communication across our geographically dispersed offices, it has dramatically increased interdepartmental transparency, with employees able to hop from channel to channel to ask questions or engage with a department.
• Rewards and recognition. Sometimes the oldies are the goodies. Good old-fashioned incentives to be open and transparent with new ideas are making a comeback, but managers are the ones who have to lead the charge, meaning managers have to set parameters about what transparency is acceptable and encouraged. Then actively focus on recognizing teams and individuals who provide insight or suggestions around the workplace. Those kudos will encourage employees to take part in more discussions, boost collaboration and increase the amount of natural knowledge sharing between coworkers.
• Open offices and flex work. Both options can break down the barriers between upper level management and employees, fostering a sense of closeness and accessibility that is unavailable in cubicle farms and 100% remote work. A study by Sociometric Solutions indicated that physical proximity boosted virtual communication. Workers who shared space were 20% more likely to communicate digitally, and emailed four times more frequently when collaborating on a project, finishing 32% faster than those working remotely.
• Open goal setting sessions and consistent feedback. Transparency can absolutely drive performance. Creating an annual forum for goal-setting and alignment, followed by a consistent process for management check-ins is one way we have moved the needle on transparency at ClearCompany. Each January, our teams meet to discuss the company’s goals for the year and lay out how their individual work will contribute to company success. Then, everyone sets clear and achievable goals that they update every two weeks. Managers also give consistent feedback on those goals, so that not only are there no surprises during performance reviews, but each employee also clearly understands why their work matters.   

ClearCompany CEO Andre Lavoie said this in Entrepreneur Magazine:

When it comes to building solid workplace relationships, trust takes center stage. Take Unbounce, for example. It took transparency to another level with its “Inside Unbounce” blog, a staff-authored, un-curated window in the organization. Not only does this demonstrate transparency to potential job seekers, customers, etc., it also keeps employees involved and up-to-date on company happenings, successes and feedback.

But are all these options, or any of them, right for your company? Companies of different sized and in different industries have varying capacities for types and levels of transparency. For one, there is no secret around the dislike for open offices. Employees can feel they’re being watched, and some loathe the noise. And while salary transparency is gaining in popularity, it’s certainly not the same as letting every employee know you’re prepping the company to be acquired. As you can see, there are boundaries and differences when it comes to transparency and only you and your coworkers can decide what’s right for your company.

Many companies have tried to find a comfortable place in the middle with information sharing policies. The theory is, by giving employees more access to what’s going on in different parts of the company, trust will be fostered, values will be internalized and goals will appear more clearly to all. The type of information you include will vary, but a good rule of thumb is to poll upper management to determine what questions they are repeatedly answering, while simultaneously asking your employees for feedback about what they wish was clearer to them.

For example, we recently conducted a poll with employees to understand how we could improve on our weekly all-staff meetings. Through feedback on that topic, we learned that we were unintentionally creating concern around employee departures by only announcing them to that employee’s department. As a result, we now always give a departing employee the opportunity to announce their new opportunity to the entire staff.

Some examples from HR professionals themselves include:

• What were our profits last quarter?
• How are we performing against our company goals?
• What are the hiring priorities right now? What departments are we growing?
• How will project Y affect me?
• Do we have an employee referral program?
• How can I get involved in company philanthropy events?
• Where else can I get involved in company culture?

Another way to create a sharing policy that will resonate with your employees is by examining your values and explaining how each value is woven into your policy.

Transparency, in any format, is laudable, but companies would do well to examine their industry, workforce, structure and turnover before jumping into the deep end of the transparency pool. A comprehensive information sharing policy will allow you to share the information your employees need to feel valued, trusted and aligned, but won’t be distracted by information that will only frustrate or confuse them.

Want to learn more about how to get your entire company aligned behind the same goals? If your goal is transparency and productivity, ClearCompany has the tools you need to manage your talent. We’ll personally walk you through the software and show you how our customizable talent management platform helps all forms of mid-size companies from hospitals and banks, to breweries and cosmetics.