What we're talking about

Transparency might have become a bit of a buzzword, often used in the context of a business sharing info with its customers (or the broader public), but its real value arguably lies within the business itself. When the inner workings of a business are understood by all, and departments share information between one another, everyone is on the same page about where the company stands and where it's heading. It can be all encompassing – ranging from, say, a leader sharing company performance info with the whole team, to employees sharing feedback with one another.

Why it's important

Internal transparency is key to a great employee culture because it demonstrates trust between management and employees, but it also translates into clear business benefits as well. When people know how the business is doing (in whatever area you choose to be transparent about), they're better able to see how their work is having an impact and identify possible areas to focus their efforts. Knowledge sharing and transparency between teams helps break down silos and encourages functions to work together, rather than competing with one another. 

A transparent culture is also likely to attract better talent; this is crucial when there's plenty of competition for great hires. A 2021 study from professional network The Org showed that 70% of respondents would take one job offer over another if that company was more transparent. This matters to employees – in the same study, 68% of people said they wanted their companies to increase their transparency efforts, and 73% said their work-life balance would be improved by companies doing so. 

Things to note

• There are all sorts of things you can be transparent about. Internal transparency can encompass a lot of different things and won't necessarily look the same at every business. Information that's often held closely by leadership or the function responsible but might be interesting or valuable to other employees includes: sales info or other financial metrics that show how the business is performing; diversity or salary information; information about product costs; or strategy or product roadmaps that show what's planned.

• Setting up systems to share is the key. What differentiates a business that's willing to share information if asked from one with a truly transparent culture is proactively sharing information on a regular basis or making it easy to find the most up-to-date information. That requires having a formal system or documentation in place.

• You can't share what you don't know. Sometimes, committing to transparency and setting up a system to bring it into effect will ensure that you're tracking or maintaining key info that you might not usually pay close attention to. For example, if you want to provide transparency to your team about how salaries are calculated, you need to have a system for calculating salaries. If you want to share information about the diversity of your team, you need to know how everyone identifies in terms of gender or race and ethnicity.

How to create a culture of internal transparency

1. Ask your employees what they want to know. You don't want to be transparent for the sake of it, but to create value for your team. So, before deciding where to focus your efforts, ask your team what information would be most useful to them. You should ask a lot of different people, at different levels and in different departments, to get a broad view. It might be worth suggesting some ideas or options, given that you'll be asking them to think about types of information that they don't regularly engage with.

2. Settle on what should be shared internally. Once you've got some ideas from your team, it's time to narrow down the areas where you can commit to transparency. When deciding what to focus on, think about how information might be used to benefit culture or business outcomes.

3. Put processes in place so that you're set up to share. Once you know what kind of transparency you're aiming for internally, assign ownership for collecting, collating and keeping that information up to date. The individual doesn't necessarily have to be responsible for sharing that information, but for making sure the information is available when needed.

4. Commit to a cadence and a platform. Once you have a plan for collecting the information, you want to make one for sharing it. Think about what the best way to communicate this information is: is it a quick email sent out monthly or quarterly? Does it get a slot within a regular all-hands meeting? Or does it live somewhere online, in a shared workspace platform, for employees to check on demand?

5. Announce your initiative (and guidelines for use). To really make transparency a fixture internally, it's helpful to highlight that you're being intentional about sharing information and explain why you're doing it. Launch your transparency plan with pride, and take this opportunity to outline guidelines for how employees should handle and treat information that's available internally but shouldn't be shared externally. 

6. Keep yourself accountable. Make sure you don't undermine your efforts by saying you're committed and then letting your plans fall to the wayside. Make sure information you promised to your team is regularly shared or updated in line with your stated goals.

7. Identify further opportunities for transparency. The companies doing transparency best are doing it across many facets of their business, so once you have some level of internal transparency embedded in your processes and culture, aim to build more in. Go back to step one of this list and ask your team what more they could find useful to know.

Key takeaways

• There are many benefits to internal transparency, including company culture, hiring and potentially even business performance.

• Creating a culture of transparency doesn't mean you have to be open about everything – it's more about being intentional and consistent with any commitment to transparency you do make.

• You should choose what elements of your business to be transparent about based on what your employees might find most useful and valuable. Think about the ‘why’ as well as the ‘what’.

Learn more

Perspective. Zack Hargett, CEO of content product company Scout, delves into a useful analogy for internal transparency. 

Example. Social media tool Buffer is an organization renowned for its public and internal transparency, and it has a list of all the elements of its business it has made transparent. 

Tool. Notion is a workspace tool that makes it easy to collate and share information in all sorts of formats in one place with your team.

A version of this article was published in the Courier Workshop newsletter. For more deep dives into essential business concepts, sign up here.