As a person, I have always admired and tried to support people that acted with transparency, because they are not afraid to share their intimate self with us; to be transparent we need to be generous and courageous, there may be no other reward than progress of human kind, a sufficient motivation for the best.
In business, it is difficult to find reliable data on the economic benefit of transparency but having had the privilege of serving as an executive in different Countries, I have direct experience on how darkness favors corruption which subtracts resources, discourages investments and makes any initiative less successful.
I have been astonished by a comment in an E&Y survey: “almost 1 in 5 company employees, regardless of grade, consider it acceptable to pay bribes to win or retain business” (E&Y: European fraud survey 2011). We are speaking about Europe, the Europe we are proud of. Transparency International latest Global Corruption Barometer reports that 36% of the people interviewed around 119 Countries considers police and elected officials corrupt, 30% considers judges corrupt. On average studies on corruption assign from 10 to 25% the cost of corruption, which implies that a world based on transparent behavior of companies, public administration and individuals would have enough resources to win forever hunger and global poverty.
What can Netplan and its associates do to contribute bottom up to eradication of corruption? Besides refusing to work with organizations that have unclear policies and those who encourage “cutting edges”, we can list the benefits of transparency in managing organizations; based on our experience and far from being exhaustive, we propose four concepts:
- Transparent systems mean stronger employee motivation and client confidence: they make the organization more resilient, everyone has a clear understanding of what is needed to achieve clearly defined goals; differing opinions can be more easily resolved based on clear facts and complete information, no manipulation of data can be used to achieve personal goals against the higher interest of the organization; clients build confidence on how the company is addressing their needs and their relationship is more resilient during turbulent times. Manage by making values and objectives clear, not by providing instructions!
- Transparent organizations allow chief executives to delegate with confidence. Every manager laments the long working hours and the high psychological pressure of responsibility; the simpler and the more transparent the processes are, the easier is for junior people to take responsible decisions, elevating to top management only those strategic issues that deserve attention. Again, a clear, live and shared set of corporate values is the foundation of a transparent organization: manage with long term vision, take long term decisions and be always ready to be replaced suddenly!
- Transparent regulations make it easier for stakeholders to consider the benefit of a project; risk management is the basis for success: removing regulatory risks from the scenarios often results in being able to focus exclusively on the merits of products and services offered. Netplan can measure quite accurately the discounts to economic value that retroactive regulations and slow judiciary processes have caused to some major clients: up to 60% firm value in recent cases, which implied zero equity for multimillion dollar investments, failed transactions, bankruptcy of valuable initiatives in wrong regulatory environment; use crystal clear communication to build stakeholders confidence!
- Full transparency is the best defense: it leaves enemies and competitors without the most dangerous weapon: suspect, against which no defense is fully effective. I learned it from a lawyer defending an innocent client from criminal charges: full disclosure left prosecutor with no tool to worsen a simple case. I have then seen it work in multiple cases of product liability, of conflict avoidance, of harsh negotiations: disarm your opponent with bare, well documented truth!
What can all of us do to implement a more just and transparent society? Act with confidence, exclude people, partners, colleagues that round corners to get short term benefits, select the right partners, invest in Countries that value transparency, make crystal-clear policies our competitive advantage.
Shall we lose competitiveness because of our transparency? When I was consulting for large government-owned corporations, the strategic plan was secret, each copy marked to a specific executive. The result was best employees ignoring the targets and acting with best intentions but no real control and poor focus… On the contrary, when working with stock listed multinationals whose strategy had been made clearly available to shareholders and potential investors, the sense of purpose was clear, and the effectiveness of the organization was the main key competitive tool to win in the marketplace.
Our recommendation: have a clear, shared corporate vision, and live it as a lighthouse to sail with confidence even during turbulent times.