In today’s ever-evolving business world, debating whether to embrace transparency is no longer an option. Customers, investors, employees, and the general public expect open and straightforward corporate communications and won’t accept anything less. This makes business transparency vital to the long-term success of any organization.
What is business transparency?
In short, transparency in business refers to organizations being honest with their stakeholders. Openness, communication, and accountability go hand in hand with business transparency.
A transparent business shares information in a timely, clear, and truthful manner, takes responsibility for its actions, and does not attempt to mislead its stakeholders or keep them in the dark.
Why is transparency important in business?
Business transparency is key to building trust with external stakeholders and keeping your employees engaged. If customers don’t trust you, they won’t do business with you. Similarly, if investors feel that you are holding back relevant information, they will not want to invest in your company. Top talent will also leave your company sooner or later if you don’t keep them in the loop.
What are the benefits of business transparency?
Nowadays, there is increasing pressure on businesses across all industries to become more transparent. Transparency in business isn’t just a nice to have anymore, but a need to have. The good news is that there are numerous advantages associated with business transparency.
Improve your bottom line
Making transparency part of your corporate culture creates and maintains trusting customer relationships. This, in turn, leads to brand loyalty and customer retention.
Since customer loyalty and customer retention impact the business’ revenue, business transparency ultimately improves profitability.
Attract more investments and build stronger partnerships
Business transparency establishes a solid foundation of trust and credibility with investors and business partners. Investors associate corporate transparency with good management and future market opportunities. On the other hand, a lack of transparency is often associated with a hidden agenda, which can halter or even stop investments in the long run.
Hence, transparent businesses are less affected by recessions, often do better on the stock market, and attract more investments.
Increase employees’ engagement and commitment to the business
Openly sharing information about the company’s strategy and objectives creates employee trust and confidence in the business’ actions. Keeping employees in the loop about important business decisions and activities makes them feel more valued and engaged. On top of that, transparency in the workplace fosters innovation and creates bonds of trust between management and employees.
Employees working for transparent companies have a higher emotional connection to their workplace, which ultimately results in their willingness and commitment to contribute to the business’ success.
How can businesses become more transparent?
There are several ways to improve transparency in your business. Hence, we’ve put together a list of best practices you can follow.
1. Keep employees in the loop
Company-wide town hall meetings are a great way to share news and results, communicate objectives and strategies, and interact with your employees. During these meetings, employees can give feedback, ask questions, and receive clear and honest answers from top management. As a result, these meetings make all employees in the company feel valued, listened to, and included.
You can also keep your employees in the loop by sending out monthly employee newsletters or asking department managers to share the information with their teams.
2. Be open and upfront with your customers
Don’t mislead your customers or withhold information from them. Be upfront about your prices, only make promises you can keep, and communicate relevant information in a timely fashion.
You can share information with your customers via newsletters, status pages, emails, social media, and your website.
3. Admit your mistakes
Everyone makes mistakes – it’s how you handle them that matters.
Always admit your mistakes and take responsibility for them. Customers appreciate companies that own up to their mistakes, apologize, and try to find solutions.
On the other hand, customers are not fond of companies that try to hide their mistakes or, even worse, get defensive and deny them.
The sooner you own up to your mistake, the sooner you can find a solution and move on.
4. Make financial information readily available for investors
A transparent company should make all relevant financial information readily available so that investors can easily understand the risks and opportunities associated with their decisions.
You can create a website page dedicated to your investors where they can easily access all your company’s relevant financial information, including annual reports.
5. Discuss expectations with your business partners
Business partnerships should be founded on mutual trust. That’s why you should always discuss expectations with your business partners.
Make sure your business partners know what you expect from them and clearly explain what they can expect from you in return.
6. Hire candidates that care about transparency
Truly transparent businesses are made of people who value transparent relationships, are not afraid to speak up, and take responsibility for their actions. They are the people your company should hire.
During hiring interviews, discuss transparency with your candidates to see how they feel about it. Present them with various scenarios to see whether they would act in a transparent way.
7. Rely on digital solutions that support transparency
Digital solutions can help companies across industries work more transparently.
For example, digital signature solutions like Penneo Sign ensure that documents are readily available and easily accessible to all the people who need them. Users can easily share documents with each other, which, in turn, facilitates collaboration.
Penneo Sign provides a clear overview of who signed the documents and when. This is particularly useful when multiple people must sign documents in a specific order, and one missing signature will bring the entire process to a halt. Having good visibility over the signing process makes it easier for you to identify bottlenecks and take appropriate action.
As a Penneo administrator, you can also view who has access to what and what their roles are.
To experience how digital signing software can help you enhance transparency in your company, request a free trial of Penneo Sign today!