Is transparency the first among equals of reputational virtues?
Here at Tovera we like to think of the attributes of corporate reputation that organisations try (or claim) to live by as virtues – a nice complement to, but distinct from, the organisation’s brand values. [see link here for more on that subject]
Our experience over the years has taught us that there is often one virtue that stands above the others in terms of its significance and impact upon stakeholder perceptions – and that attribute is transparency. Stakeholders want to see that organisations are willing and able to be transparent about how they operate and that they have nothing to hide from scrutiny. And they need to be able to trust that the mechanisms are in place to ensure that transparency.
To take an example from the political scene: In the early days of the Trump administration in the US, an article in Daily Mail re Trump’s Mar-a-Lago talks about how the club doesn’t reveal its members’ identities, log visitors or allow public access. Critics, the article claimed, say this is an inappropriate place to conduct government business. “Yet the Trump camp counters that there’s no question of guests having preferred access to the president. ‘It assumes the worst of us and everyone and that is unfair’ says Eric Trump”.
Arguably more recent events have inured us to some of the more extreme behaviours of this administration, but I’m not trying to make a political point. I totally agree with Eric Trump that it assumes the worst. But I totally disagree that it is unfair. It simply plays to the reputational truth that actions should be open to scrutiny and seen to be open to scrutiny. Big brands, organisations and – especially – governments should be held to higher standard because of their power. Transparency is a fundamental reputational pillar. It needn’t be transparent to you and me or any old individual off the street. But we need to know it’s transparent to those we put in place to guard organisational integrity on our behalf. This makes the standards that we expect our government/regulators to uphold to be of the highest order. If governments can’t see the importance and plead “unfair” where do we place our trust?
We are feeling the heat of this in the UK with our experience of the handling of the covid-19 response. We ought to be able to trust the government, the health specialists and their regulators to keep us safe. But in an uncertain environment, where accessible statistics and “facts” are hard to come by, let alone understand, we have to believe that transparency is in operation somewhere along the line.
A brand can tell an authentic story that bends the rules (Ryanair, Pot Noodle) or provide such a superlative product/service that we turn a blind eye to those behaviours that don’t touch us directly (Amazon and employment rights, Apple and tax) but we have to know that the underpinning of those organisations is legal, overseen by regulators with integrity etc.
So there has to be transparency somewhere in the chain and we have to trust that those ultimately responsible are able to see. Regulators need to work harder to prove their credentials as upholding society’s expectations of corporate governance, institutional ethics etc. And these credentials are derived from behaving in an absolutely correct way.