by Natasha Mudhar.
There is wisdom in the old adage “honesty is the best policy”, especially for businesses. We live in an increasingly connected world, where openness and truthfulness is praised and secrets are viewed with suspicion. For businesses and brands, this has meant a concerted effort must to appear honest, and meet public expectations – or face the consequences.
A good example of the cost this can have is the Volkswagen Emissions scandal, which led to resignations, plummeting stocks, and a tarnished brand reputation. Other organisations have also fallen foul of concealing facts for years that ultimately damage their brand significantly once discovered.
Transparency in an international organisation can often be the simplest and most beneficial route for a company. It saves money through avoiding crisis management and helps to enhance a brand’s reputation with the right brand strategy. Furthermore, it can strengthen the general public’s trust in an organisation. This is something that governments around the world have been benefitted from.
The UK government for example has instigated a number of initiatives to improve transparency and accountability, including the freedom of information act, improving the availability of open data, and giving people a right to data. This kind of openness has encouraged greater public participation in decision-making, and it is something businesses have been trying to replicate with varying levels of success.
A transparent business is a more purposeful business; it is a business that an audience feel they can trust and one that shouts authenticity in everything they do. It is no accident that the rise in transparency in business has coincided with the popularity of corporate social responsibility. Honest practices demand businesses and brands to be more responsible; there can be no sustainability or responsibility without transparency.
This relationship between corporate social responsibility and transparency in business highlights the fact that corporate honesty is synonymous with three other concepts: trust, responsibility, and accountability.
Together these help to support sustainable growth for any organisation, and can result in better business management, increased innovation, greater profitability and of course a positive impact on social good. Much of this is rooted in an understanding of the importance of knowledge and the importance of sharing that knowledge through a strong communication strategy and influencer marketing so that it is available, accessible and usable.
Whilst these are noble goals for any organisation, it needs to be actively pursued to have a lasting impact and maintain trust with its customer base. Corporate social responsibility goes beyond being a global PR or brand strategy. Recent controversies around social media companies like Facebook regarding secret personal data collection as well as the proliferation of harmful and potentially election-swinging fake news stories have undermined the image the company seeks to portray of an open, user-friendly and trustworthy platform.
The focus for companies seeking to be transparent has to be on putting credible social, environmental and ethical data in people’s hands, so that they are able to make more informed – and therefore better – decisions. For businesses, an added benefit is the multi-plier effect it creates: consumers will ideally become more loyal with greater demand for products from a trusted source of relevant and truthful information; employees – the growth engine of companies – will be motivated to work more efficiently to meet demand, and so forth. A good example is the commitment to open data and accessibility that private corporations like Monsanto have demonstrated, with plans for openness within the agricultural sector that would benefit many customers and communities.
The importance of trust and dissemination of trustworthy business practices and information to consumers and employees ties into the key concept of responsibility. Companies have a responsibility to their stakeholders, and that includes a willingness to share detailed information on the business and its activities. This responsibility also extends to making this information easily accessible to consumers, highlighting the importance of creating an open platform, where everyone irrespective of position/background can be heard and can hear others too. The recent popularity of petition platforms on government websites demonstrates this.
The result of greater trustworthiness and responsibility is that the customer base is able to grow more aware of their issues and rights, enabling them to hold organisations accountable, whether they are governments or private sector companies. As businesses become increasingly transparent, accountability can be a powerful motivator in remaining so; the impact of the digital revolution on transparency is such that we will always leave a data footprint – and as many companies and individuals have discovered in the past year, the truth will come out sooner or later.
The ever-growing need for transparency within businesses within our increasingly connected and data-driven world also highlights an essential need for the private and public sector to work collaboratively. Through working together, businesses and governmental organisations are able to provide universal access to knowledge and information that’s available, useable and accessible. This also extends to collaboration between commercial enterprises and not-for-profits.
Transparency can seem like a daunting step for traditionally private businesses. But with more organisations ranging from tech giants to socially conscious enterprises committing to being trustworthy, responsible and accountable to their customers, it is increasingly clear that it is possible be both transparent and commercial; to be honest and successful. Never has there been a better time for an organisation to be doing well by doing good – in full view of the public with nothing to hide.
Miss Natasha Mudhar, Global CEO, Sterling Media, the global business and communications consultancy, bringing brands, individuals and companies closer to their purpose.