How will your data be used if you sign up for this service? What is the factory working conditions where your t-shirt was made? What’s the carbon footprint of that banana you enjoyed at breakfast? What commission rate will you pay your realtor for selling your home?
These are just a few questions you might ask yourself as a normal, financially sensible, morally reasonable consumer. And in the past, the answers were incredibly challenging to come by.
Thankfully, the tides appear to be turning, and transparency is becoming more than just a consumer preference – it is now a business imperative. In the past few years, several industries have reckoned with long-held frustrations over opacity, and new thought leaders and innovators are paving the way for greater transparency in business.
What exactly does it mean for a business to be transparent? Let’s take a closer look.
The Bottom Line: Access
First and foremost, transparency is a result of access. Access to choices, access to resources, access to information, access to how your data is used, and upfront access to pricing structures.
The fewer barriers that exist between a consumer and their full understanding of the product/service they are purchasing, the more transparent the transaction is. That’s the bottom line.
What Access Looks Like: A Case Study
As an example, let’s take the real estate industry. In the past, some agencies had a reputation for being opaque (i.e., the opposite of transparent). It was challenging for buyers and sellers to find information on an agent’s sales history and nearly impossible to find verified reviews to guide their decision-making. Moreover, many agents had unclear or outright hidden commission rates.
Recently, however, companies like Nobul have emerged to force transparency on the process. Nobul is a fantastic example of a transparent company; they help consumers find real estate agents by combing through verified reviews, sales histories, and comparative commission rates – without any influence or kickback from agents.
“We’re helping bring more transparency, credibility, and accountability to the single biggest transaction of people’s lives,” CEO Regan McGee told Medium in a recent interview.
Furthering Transparency: Criticism and Internal Communication
Transparency is one side of the equation, the other being action. It’s all well and good, for example, if a clothing brand is upfront about how they source their cotton. However, they need to be prepared to hear, incorporate and leverage the consumer reaction.
If consumers don’t appreciate how and where the company sources its materials, the company needs to be able to pivot, adapt and grow as a business. This is an ancillary process, but it’s an important one – a defining feature of a transparent business that puts transparency into action.
Another defining feature of a transparent business is its internal communication. We tend to think of transparency as a concept played out between a business and its consumers, but transparency can and should have a home in the workplace. A company that builds transparency into its internal strategy forms a solid basis of trust among employees and partners.
To summarize, transparency in business is mainly about providing access – to information, resources and options. Secondarily, transparency may play out in the way a business handles criticism and organizes its internal communication.