How Transparency Fosters Trust

The first rule I was taught in business? Something that came back to haunt me. Let me explain. Growing up, I was told: Keep business information close to the chest. The belief was: If employees knew too much… revenue, challenges, what’s really going on… they might use it against you. That’s the mindset I saw modeled. So at first, I followed it. The result? ❌ Team members felt like outsiders, not owners ❌ Trust eroded each time something surfaced indirectly ❌ Morale dropped (it’s hard to stay motivated when you don’t know what you’re working toward) ❌ It slowed us down (more questions, more confusion) ❌ It created silos (departments focused on surviving, not collaborating) I knew something was broken, but didn’t know how to fix it. Until… a hero came along. I hired Sean to replace me as CEO. And one of his first decisions was something I was feeling in my heart all along. That we need to lead with transparency. So we did a full 180. Now, once a quarter, we host an all-hands meeting where we share everything… no sugarcoating. ✔️ Revenue growth (or decline) ✔️ Viewer stats and content performance ✔️ What’s working ✔️ What’s broken ✔️ New bets we’re making (and the ones we’re letting go of) Yesterday, we opened the books and laid it all out for nearly 100 team members in person and 100+ tuning in remotely. The wins, the losses, all of it. The new result? Transparency has done something that secrecy never could: It’s built trust. Ownership. Alignment. What I’ve come to learn is, when everyone knows the scoreboard: They don’t just clock in… they lean in. The old way was fear-based. This way? It’s mission-based. And in today’s world, that makes all the difference.

Ever wonder why some organizations feel like bustling marketplaces of ideas while others resemble fortresses guarding ancient secrets? Here's a truth that transformed my understanding of modern leadership: in a world where information moves at light speed, walls don't protect value - they prevent it from growing. Think about how scientific breakthroughs happen. The most significant advances often emerge when researchers share their findings, allowing others to build upon their work. When organizations embrace this same spirit of openness, something remarkable occurs. Ideas cross-pollinate. Solutions emerge from unexpected collaborations. Trust deepens because people understand not just what decisions are made, but why they're made. The fascinating part is how transparency actually accelerates problem-solving. When teams operate in silos, they often waste time solving the same problems others have already figured out. But in an open environment, knowledge flows freely. That challenge your team has been stuck on for weeks? Someone three desks over might have solved it last month. That innovative approach you developed? It could spark a breakthrough in a completely different department. Consider how trust works in relationships. When someone is consistently open with you, sharing both successes and struggles, you naturally develop confidence in them. The same principle applies organizationally. When leaders share the reasoning behind decisions, acknowledge uncertainties, and openly discuss challenges, they create an environment where people feel safe being equally transparent about their own work, ideas, and concerns. The really powerful shift happens when transparency becomes part of your cultural DNA. Instead of asking "Why should we share this?" people start asking "Why wouldn't we share this?" This mindset transforms meetings from information-hoarding sessions into collaborative problem-solving workshops. It turns company-wide communications from carefully crafted PR statements into authentic conversations about where you're headed and why. What's your experience? How has increased transparency changed the dynamics in your organization? What happened when you took down some of those information walls? #Leadership #OrganizationalCulture #Transparency #Innovation #Trust

How transparent should we be with our people insights? This is a question I hear from leaders all the time, and, like any good social scientist, my answer is: it depends. Let’s put aside the non-negotiables—those bound by law or confidentiality. Beyond that, there’s a wide spectrum of how companies handle sharing people data insights, and there’s no one-size-fits-all approach. Here are a few key things I always consider: 1️⃣ Data Source Matters: If employees are giving feedback through engagement surveys or focus groups, it’s crucial to share those insights back with them to increase trust, accountability, and future participation. 2️⃣ Know Your Audience: Even if you’re talking about the same metric, you should communicate about it differently to different audiences. Executives often want to know about the high-level trends and strategic insights while the company at large may want to hear about how it directly affects their day-to-day work. You can also consider sharing the information with leaders first, so they are equipped with extra context. 3️⃣ Consider Sensitivity: If the data touches on delicate issues—like potential layoffs, some diversity metrics, or areas where the company isn’t performing well—it’s essential to approach these topics with care. Consider the risks and who needs to know in order to act on the information. Transparency doesn’t mean sharing everything; it means sharing thoughtfully. 4️⃣ Look at Precedent: Consistency in communication builds credibility. Suddenly withholding information you’ve shared in the past can raise red flags. On the other hand, if transparency is new to your organization, you might start by sharing smaller insights and gradually build up to more comprehensive data. 5️⃣ Clarify the Purpose: Is it to inform, to spark action, or to inspire change? Being clear on this will help you decide how much to share, with whom, and how to frame it. 6️⃣ Anchor to Usefulness: A lot of what we study in People Analytics can be helpful for employees to know. How can managers increase psychological safety? How can employees get higher quality feedback from their colleagues? How can distributed teams collaborate best? Whenever possible, I like to share these learnings with employees so they can benefit from our data-informed wisdom. My default? Lean into transparency. In the absence of data, human nature is to make up a narrative—and the stories we create are often far worse than the truth. When appropriate, sharing our knowledge broadly can empower employees and leaders alike to work with a greater shared understanding of reality. Being transparent doesn’t mean sharing everything with everyone, but it does require being purposeful, considerate, and consistent about what you share.

I still remember the moment I read GiveDirectly's blog post openly admitting they'd been defrauded by members of their team in Uganda. 🤯 Most organizations would bury this information. They highlighted it. They shared exactly what happened, their investigation process, and the changes they made to prevent future errors. Instead of hiding their mistake, they leaned into transparency. Studies consistently show that strategic vulnerability builds more trust than projecting perfection. We're wired to trust people and organizations that show their humanity. We all instinctively know that nothing is perfect. The key is giving your flaws the right context. Pair it with a strength - what will you learn? Where will you go from here? 🔑 Effective transparency looks like: → Sharing real-time impact alongside setbacks → Revealing your finances in digestible ways → Creating spaces for honest conversations with stakeholders → Publishing external reviews (even mixed ones) → Empowering beneficiaries to tell their unfiltered stories In the nonprofit world, where donor skepticism runs high, authenticity is your most powerful asset. So, how is GiveDirectly doing in the decade since revealing this setback? Find out on the fully transparent financials page of their website: https://lnkd.in/emVYqvsR

Executive directors hiding funding issues? It happens more than you think. I've seen a nonprofit leader who rarely cashed paychecks to help with finances. And another who took out personal loans to donate to the organization. While these actions stem from good intentions, they often create more problems than they solve. Here's why: 1. Hiding financial struggles prevents boards from fully understanding the organization's health. This limits their ability to provide strategic guidance and support. 2. Leaders forgoing paychecks can lead to burnout and resentment. And of course, there are some labor law issues, putting the nonprofit at risk. 3. Personal loans to the organization blur professional boundaries and can create conflicts of interest. By concealing financial realities, leaders unintentionally make it harder for boards to provide effective oversight and support. This lack of transparency can erode stakeholder trust and hinder the organization's ability to address challenges proactively. This is why I advocate for a culture of openness in nonprofit financial management: - Regular, detailed financial reports to the board - Open discussions about fundraising challenges and successes - Clear policies on executive compensation and benefits Implementing these practices offers several benefits: 1. Improved decision-making: With accurate financial information, boards can make more informed strategic choices. 2. Enhanced donor confidence: Transparency builds trust, potentially leading to increased donations and long-term supporter relationships. 3. Better resource allocation: Understanding the true financial picture allows for more effective budgeting and program planning. 4. Stronger partnerships: Open communication about finances can lead to more productive collaborations with other organizations and funders. By fostering a culture of financial transparency, we're creating an environment of trust and collaboration. This allows nonprofits to focus on their core missions without the burden of hidden financial stress. Remember, transparency isn't just about sharing numbers – it's about creating a culture of honesty, accountability, and shared responsibility for the organization's financial health. What steps is your nonprofit taking to increase financial transparency?

Many organizations are wary of publicizing their diversity numbers out of fear that such if their numbers aren’t favorable, the company will face repercussions, especially if they don’t have the numbers to show for their efforts. New research indicates that transparency mitigates observers’ negative perceptions of organizations that do not demonstrate immediate progress on DEI goals. Specifically, Evan Apfelbaum and @Eileen Suh told participants that a company (out of a possible 30 companies) had made a public commitment to increasing the diversity of their workforce. Half of the participants were then told that the following year after making their statement of commitment, the company in question reiterated its support and in an effort to be transparent, provided the demographic data of their employees. These graphics were based on the actual EEO-1 data of the 30 companies and shown to participants. The other half of the participants were told that the company reaffirmed its commitment to DEI but not shown data. The researchers find that merely making data public increased perceptions of the company’s sincerity in its commitment and their perceptions of the company’s trustworthiness. In a subsequent study, the researchers manipulate whether a company publicly committed to DEI provides evidence of progress (an upward trend in percentage of URM) or not (the proportion of URM in the firm held steady with a straight line over time). They also manipulate whether the data is publicly available or obtained through private means. They find that although people generally see the companies whose diversity numbers do not improve as being less committed to DEI, having made less progress, and less trustworthy, this is mitigated when the company makes their lack of progress public. That is, people were least impressed with a company that made a public commitment to DEI but then seemed to want to quash their lack of progress by hiding their statistics. In contrast, a company that made a commitment but then owned up to not making the progress they had hoped for (but continued to commit themselves to improving) was seen only a little less positively than companies that seemed to be successfully diversifying their workforce. While I doubt that these effects would hold if a company continued to show a lack of progress over a longer time horizon, they are consistent with the notion that transparency is almost always better for everyone. Many of you know that I have long harped on companies’ lack of willingness to share their data, or at the very least, disaggregate their data in ways that would allow people to have a better sense of what progress, if any, is happening. These findings suggest that companies should be more willing to make these data public; at least in the court of public opinion, there’s not a downside to doing so. https://lnkd.in/ekRVFmQu

STOP BEING SO NICE. I recommend that all leaders embrace 𝗽𝘂𝗿𝗽𝗼𝘀𝗲𝗳𝘂𝗹 𝘁𝗿𝗮𝗻𝘀𝗽𝗮𝗿𝗲𝗻𝗰𝘆. For me, the goal isn’t to overshare or be harsh. It’s about sharing the 𝗿𝗶𝗴𝗵𝘁 𝘁𝗵𝗶𝗻𝗴𝘀 with the 𝗿𝗶𝗴𝗵𝘁 𝗽𝗲𝗼𝗽𝗹𝗲 at the 𝗿𝗶𝗴𝗵𝘁 𝘁𝗶𝗺𝗲. I learned quickly that “being nice” in an attempt to maintain the illusion of harmony did not produce results. In fact, it just misled people. Holding back the truth to avoid any potentially awkward conversations leaves unresolved issues to simmer for both parties involved. And that’s bad for business. Here are 5 major results you can expect by being purposefully transparent: 1. Builds trust. 2. Sets expectations. 3. Fosters accountability. 4. Breeds respect. 5. Attracts top talent. When we only say what's easy to hear, we don’t convey a real message. This weakens trust and creates a false dynamic. So, stop sugarcoating everything. You can communicate your thoughts with honesty AND kindness. When you share tough truths, frame them with solutions or support. Transparent teams don’t just grow—they excel. #Trust #Leadership #Feedback #Communication

Something most companies suck at: Communicating transparently and maturely with their team. Let me explain. Being transparent isn’t about sharing everything in the company. It’s about treating your team like adults. Founders think they need to tell their team everything that’s going on behind closed doors. And yes, sharing wins, losses, and updates is important to keep people on the same page. But what they don't think about is the goal of transparency—building trust. How? By being direct and honest. For example, the other day, I spoke to my team about an unconventional way we're allocating spend at FERMÀT. I acknowledged that I knew unconventional, I knew my team disagreed with it, and I knew they may complain. I told them that it's ok to disagree and complain about it, but this is what we're doing and this is why. This isn't a rude approach; it's respectful. You’re: ➝ Acknowledging the reality of the situation ➝ Validating their thoughts and feelings ➝ Treating them like adults The real problems arise when we pretend there are no issues and act as if everything is sunshine and rainbows. If something is frustrating in the short term, say it. Otherwise, you're going to create a loss of trust. If you want your team to trust you, talk to them like the adults they are and acknowledge the elephant in the room. 

Controversial lesson for leaders & CEOs: 👇 STOP BEING OVERLY POSITIVE! → Share both wins and losses. → Employees sense the truth. → Authenticity builds trust. Don't sugarcoat reality! When I started as a founder, I thought maintaining a positive facade was best. But over the years, I learned that acknowledging challenges openly fosters a stronger, more motivated team. Here’s what I realized once I started sharing the burden: → I wasn’t alone in handling setbacks. → Employees can and should tackle problems. → Honest communication leads to collective solutions. When losing a big client or facing big challenges, share the reasons openly and improve together. Being transparent isn't about negativity; it's about trust and collaboration. What steps will you take today to foster authenticity in your leadership? #cocreate #leadership #strategy #companyculture #workculture #success Please ♻️ reshare if you believe in honest leadership.

What does ESG transparency mean for the future of business? Imagine: You're walking into a store, ready to make a purchase. You pick up two products, one with clear information about its environmental impact, how it's made, and whether it supports fair labor practices and one without. Which one would you choose? Now, Shift that decision-making to investors, customers, or even governments. They’re increasingly prioritizing companies that openly share their Environmental, Social, and Governance (ESG) efforts. Why? Because transparency builds trust, and trust drives long-term success. Here’s the challenge: ESG disclosures aren’t just nice-to-have anymore they’re becoming mandatory. Governments, regulatory bodies, and stock exchanges worldwide are implementing ESG compliance requirements. According to a recent report over 90% of global investors consider ESG factors when making decisions, and more than 75% of large companies now issue sustainability reports. These reports aren’t just data dumps; they’re stories. They tell us how a company is reducing carbon emissions, supporting its workforce, and making governance decisions that align with broader societal goals. Think of it as a window into how a business impacts the world and, just as importantly, how it manages the risks and opportunities tied to that impact. In my opinion, ESG transparency isn’t only about ticking boxes. It’s about accountability showing that businesses understand their role in shaping a sustainable future. Companies that approach ESG disclosures thoughtfully, with clear frameworks and genuine commitment, are more likely to win the trust of their stakeholders and thrive in an increasingly conscientious marketplace. For businesses navigating this complex landscape, it’s crucial to understand the most common ESG disclosure frameworks, like the Global Reporting Initiative (GRI) or the Sustainability Accounting Standards Board (SASB). These frameworks provide a structure, ensuring reports are not just thorough but also meaningful. The journey to ESG transparency might feel overwhelming at first, but it’s also an opportunity a chance to stand out by showcasing what you stand for. How does your organization approach transparency? Do you see it as a compliance exercise or a way to connect authentically with your audience?