The Importance of Transparency in the Workplace

Mar 06 2023 | Perspectives

'Workplace transparency' is a corporate term that we hear all the time. It's one of those concepts that we may think we understand, but when you closely examine it, transparency can actually be more complex than we may think at first glance.

So, what is workplace transparency?

Workplace transparency essentially means having open communication between leaders and employees at work, building trust amongst employees, and recognising the importance, successes, and hard work of the workforce.

A lack of transparency in the workplace can lead to high employee turnover, distrust, and an unhealthy work culture.

So, when using the term ‘workplace transparency’, think about it as open communication and trust within a workplace – it’s a priority. But, why?

An Example of Transparency in the Workplace

The most common examples of transparency in the workplace are often around topics like salary, career development and promotions, diversity, and company performance.

For example, when things are going well (or not!) for the business, keeping your employees up to date will help them feel appreciated for their work, whilst keeping them in the loop with company direction, losses, or wins. Or, when it’s not feasible for career development due to company circumstances, being honest with your employees is going to prompt far more understanding and respect.

Why is transparency important in the workplace

Here are just some of the beneficial effects of a transparent workplace:

  • Fosters a healthy culture of trust & respect

  • Improves teamwork & boosts efficiency

  • Benefits employee happiness & engagement

  • Helps to promote diversity and inclusion

Now, let's take a deeper look at each of these.

Fosters a healthy culture of trust & respect

Having open communication ensures your employees don’t feel out of touch or lied to, which fosters a sense of trust – they know what’s going on. Why? Because when you’re the first to let them know of updates and changes, you show them that you value their involvement and insight.

This helps to build and strengthen relationships between leaders and their workforce, nurturing a healthy environment of collaboration. Employees will feel more confident to speak up and give feedback.

The better and more honest the relationship is, the more respect employees will have for company leaders, while feeling more respect at the same time.

All-in-all, this is going to have a positive effect on your staff turnover rates.

Improves teamwork & boosts efficiency

Being transparent ensures your employees know exactly what the company goals are. However (and quite troublingly) 60% of employees don’t feel they are well-informed about their companies’ goals.

Knowing what you’re working towards is of course going to be far more motivating than working towards no goal at all, or the abstract idea of progress. This collective knowledge of the business goals is going to foster better teamwork and boost efficiency to achieve these open and honest objectives that you define.

Benefits employee happiness & engagement

When your employees perceive open and honest communication, there’s no doubt they’ll feel far more appreciated which contributes to increased engagement. In fact, a study showed that 70% of employees reported higher levels of engagement when their leadership regularly updated them on organizational strategy.

Research suggests that when employees do perceive transparency at work, they show a 12x greater job satisfaction to those who don’t.

Helps to promote diversity and inclusion

Free and open communication helps to expose inequalities that are currently in the company by giving employees the confidence to give feedback and highlight issues. Hiding problems, like a lack of diversity, simply cannot lead to finding solutions.

How to create workplace transparency

So, we’re aware of the benefits introducing transparency into the workplace can have, but what are some simple steps to take to do so?

  • Giving regular company-wide updates

  • Giving feedback

  • Encouraging feedback from your employees

  • Explaining decisions

Give regular company-wide updates

Schedule monthly or quarterly company-wide update sessions. Here, you can consider giving updates on company performance, future strategy, and targets. But the main idea is to simply keep everybody in the know.

Give feedback

This can be done at a company-wide level, which ties into giving regular updates, but can also filter down to a managerial level. Make sure 1:1’s are regularly planned to keep open dialogue and use the time to give feedback on company and personal performance.

Encourage feedback

Whilst giving feedback is key, encouraging your employees to do the same is also beneficial in creating that healthy workplace culture. This will allow for transparent conversations, as well as increasing employee’s confidence to challenge, share, question, and collaborate.

Explain decisions

It’s all very well giving updates to your workforce. But explain why. This allows them to feel respected, whilst keeping accountability.

Transparency in the workplace creates a far healthier, happier workplace culture. This can be about a heap of benefits to your company and employees – a win, win!

Coaching your leaders to instil this into a company is the first step in reaping these benefits, and coaching your managers can ensure it persists.

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