How Transparency Can Benefit Your Company (There’s More To Be Gained Than Consumer Trust)

“If you’re not scared by what you’re revealing, than you’re not being transparent enough” –Jeffrey Hollender, Seventh Generation

If real transparency is scary, why create it?  Like with most things that bring real value (and take real effort), there are several benefits of having a glass-walled company.  A note before the benefits: transparency isn’t a communication, HR or sustainability strategy; it’s a practice for your company’s communication, HR and sustainability strategies.

  • Increased revenue.  Being more transparent (a combination of truth and specificity) with your company’s actions can get you an 18% jump in revenue. Go the other direction and you can anticipate a 6% drop in revenue (EngagementDB 2009 report).
  • Problem solving.  The point of transparency is not only to reveal problems, but to solve them. In its commitment to making only toxin-free cleaning products, Seventh Generation ran tests and worked with suppliers. Later, when a toxin was found in a product there was understandable outrage from consumers.  “We didn’t take that one essential step: to share our trials and tribulations with everyone outside the company who might have wanted to…challenge our progress,” says Jeffrey Hollender.  The outcome was bad publicity and a knock to consumer trust, both of which could have been mitigated or avoided if consumers had been brought into the product evaluation process earlier.
  • Employee commitment & innovation.  Transparency isn’t just a public-facing practice.  Allowing employees to see where the business outperforms and in which areas it’s weak binds each employee more closely to the company’s strategic goals. Openness and trust (two effects of  transparency) create a comfortable environment that spurs innovation and experimentation and reveals early failures or oversights.  The more a company trusts me with its wins and shortcomings, the greater my personal connection to the company is and the harder I want to work as an employee (or consumer advocate).
  • Consumer trust.  This point is almost not worth mentioning given its obviousness. Consumers trust companies and nonprofits that are open and truthful with them–just as they trust friends, romantic partners or parents who do the same.

As individuals, we connect with the underdog, the real, the flawed–whether in a date, friend, celebrity or company.  If Walmart can benefit from sharing where it’s falling short in its sustainability goals, surely we all can.

In an upcoming post, I’ll talk about ways to create transparency.  If you have ideas or tactics, I’d love to incorporate them. Send me an email at olivia(at) or post them below in the comments.

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Leave a comment
  1. Heidi Massey May 24, 2010 at 4:54 pm #

    To me, what resonates the most in this entire piece is this statement at the end of your post: “As individuals, we connect with the underdog, the real, the flawed—whether in a date, friend, celebrity or company.” Spot on!

    Thanks for another great post (as usual!)

  2. admin May 24, 2010 at 4:59 pm #

    Heidi, thanks for reading! Transparency is a funny topic to write about (or at least it was for me today) because it’s so obvious and straightforward in most respects, but can be easily screwed up!

  3. Andrea May 25, 2010 at 1:45 pm #

    I suppose my favorite aspect of this post falls within calling transparency scary, suggesting that exposing your practices “should” scare you. However, by exposing practices, flaws and all, we shouldn’t be scared, nervous about perception, but ultimately OK with having it all out in the open. So, honesty should lead to profitability…I’m in.

    Love all your posts!

  4. admin May 25, 2010 at 5:50 pm #

    You got it Andrea! That’s the idea. I think it’s a great quote. I am planning to remember it myself at a clutch time.

    Thanks for reading and I’m glad you enjoy the posts!

  5. Aligator January 8, 2014 at 2:50 pm #

    I love transparency in everything


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