This Is How HR Can Help Companies Focus on Transparency

This Is How HR Can Help Companies Focus on Transparency

Transparency is generally acknowledged to be of importance in the workplace; however, many people use the term without a thorough understanding of its meaning. Although many companies know the general definition of transparency, few have truly mastered its implementation. There are a variety of reasons transparency is so elusive for many businesses, but one of the main reasons is the lack of an explicit plan that prioritizes transparency.

The value of transparency is its ability to give employees, board members, and other stakeholders insight into what is going on within a company, both good and bad. For many companies, transparency is an initiative that’s handled by CEOs and other C-level executives with little input from HR.

This may not be the best approach, however. Human resources professionals have direct access to all personnel, giving them a distinct advantage in communication, which is the key to transparency. Here, we’ll explore some of the many ways transparency can improve the workplace and how human resources departments can facilitate this process.

Be Open to Suggestions

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Any company looking to encourage transparency should start by being open to suggestions from employees at all levels. Traditionally, corporations have looked exclusively to executives for ideas on how to improve various aspects of companies. However, doing things this way is ineffective on its own.

This is because C-level executives are often far removed from working in entry-level positions, and some did not even start there. This is not to say that CEOs can’t have valid ideas regarding transparency. However, as far as transforming an entire company’s culture, input from various employees across various positions and perspectives is infinitely better.

One of the easiest ways to find out about employees’ views on transparency is to conduct formal and informal surveys. One of many effective data-gathering tools, surveys allow employees to voice their concerns without fear of judgment. HR professionals are more likely to elicit honest responses when surveys are anonymously administered.

Other ways to solicit employee opinions include holding town hall-style meetings and Q&A sessions. While transparency and a changed corporate culture do not happen instantly, gathering and analyzing data within your organization is a great start.

Seize Opportunities to be More Transparent

Not every aspect of transparency needs to be explicitly articulated. Much of transparency is intuitive, and experienced HR professionals are aware of the difference between genuine transparency and divulging too much information. Accessing, gathering, and evaluating data is undoubtedly important, but HR departments should understand that a lot of what is ultimately deemed effective must be tested prior to full implementation.

One of the most contentious points when it comes to transparency is that of open versus private compensation policies. With such widespread internet access, companies as well as current and prospective employees are able to obtain salary and benefits information online. Some companies have made a concerted effort to keep this information hidden. However, this decision can be problematic.

For current employees, lack of available information on pay scales and compensation levels can lead to distrust of the employer and can even cause interpersonal problems with colleagues. Secrecy on the part of companies puts potential employees in the awkward position of not knowing how they will be compensated upon hire. As a result, they may feel compelled to broach the subject during the interview process. This can detract from both interviewers’ and interviewees’ abilities to use the interview to determine whether the position is a good fit for the applicant in other ways.

Statistics have demonstrated that salary transparency is a major driver of productivity. Employees in salary-transparent companies are more likely to be happy with their work and to be more focused. Rather than wondering what another co-worker is earning or if they are being fairly compensated, employees can place emphasis on doing their best work. Also, employees who work for companies with an open compensation policy are more aware of how their work affects their pay. This means that they don’t have to wonder what they need to do in order to qualify for a salary increase.

What Do the Data Say about Transparency?

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Transparency in organizations has been studied extensively, and the bulk of the data suggest that corporations that value transparency are deemed more trustworthy by employees. According to an American Psychological Association poll of 1,500 workers, 25 percent of employees are distrustful of their employers. Approximately 50 percent of those surveyed indicated they believed that their employers regularly withhold information that is vital to the successful performance of their jobs. This is a significant problem and it illustrates why transparency is so important.

Most of the data indicate that transparency is equated with increased organizational growth. This is especially true of companies that prioritize transparency in areas such as salary, promotion criteria, and succession planning, to name a few. Companies that make transparency a part of their core values have seen even more benefits. In the technological sphere, companies are able to reach millions of people worldwide, so transparency has global reach as well.

Data also suggest that transparency improves relationships among employees and between employees and management. In terms of reducing turnover, transparency is key. A 2014 CareerBuilder survey indicated that over 35 percent of the 3,000 employees surveyed wanted to leave their jobs because they held negative opinions of their supervisors’ performances.

Companies that prioritize transparency are ahead of those that choose to ignore it. Harvard Business Review reported that 70 percent of employees surveyed stated they were more engaged professionally when management made an effort to openly communicate changes and new strategies.

When it comes to transparency, HR departments have a unique role that enables them to reach employees at all levels. When companies value transparency, they demonstrate that the opinions and wellbeing of all employees are as important as the business itself. Transparency-focused companies understand that employees who trust their employers are more dependable and are generally happier.

Robert Hohman, CEO of the employer review site Glassdoor, indicated that not only is transparency important in the workplace, it is also full of challenges. As to what the future holds for transparency in the workplace, Hohman went on to say that companies that prioritize transparency will be better equipped to make smart business decisions leading to increased profits and happier workforces.

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