Organizational Transparency

Organizational Transparency

Copyright: © 2018 |Pages: 11
DOI: 10.4018/978-1-5225-2255-3.ch065
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Transparency is one of the most frequent words in the contemporary public discourse, due to the growing demand for organizational transparency from the many stakeholders, which include shareholders, national and international watchdog organizations, the mass media and influential bloggers (Wehmeier & Razz, 2012). For instance, since shareholders invest money in corporations, they require financial disclosure, the exposure of future strategies and the revealing of the corporations’ decision-making processes. Also, factors such the crisis in the ‘new markets’ and financial crisis have increased international and national watchdog organizations such as Transparency International to continue to raise the issue of corporate transparency (Wehmeier & Razz, 2012).

Although the notion is frequently part of the daily discourse, the concept of transparency is rarely defined – neither in the news nor in the companies – beyond common-sense understandings as ‘openness’, ‘insight’ or ‘clarity’ (Christensen & Cornelissen, 2015).

According to Hood (2006 apud Wehmeier & Razz, 2012) the roots of transparency were present in ancient China and Greece. The Online Etymological Dictionary (2007), points out that the term transparency is derived from the word ‘‘transparentem’’, meaning ‘‘show light through’’, which in figurative use became ‘‘easily seen through’’, its figurative meaning started being used somewhere between the XV and XVI century. The word continued to be used throughout and became part of many Latin derived languages such as the Italian, Spanish, Portuguese, French and English (Vaccaro & Madsen, 2009).

Transparency is usually presented as an unquestionably positive concept for the public, governments, and firms, found in almost every code of conduct, held as a foundational principle and an objective of most governmental and non-governmental organizations. However, fewer authors dedicate their research to present the issues or negative consequences of transparency (Fenster, 2006). There is an established view that transparent companies, governments, institutions and processes are essential to achieve corporate social responsibility, social justice, environmental security, true democracy and wellbeing (Menéndez-Viso, 2009). In the words of Christensen & Cornelissen (2015), this veneration of transparency as a value is the “myth of transparency”. More than that, the contemporary organizations are in the business of transparency, as the result of legal, social or public pressure, or even as a self-goal to be transparent. Nevertheless, although the transparency is a growing concern, it does not mean that they are open about everything they do (Christensen & Cornelissen, 2015)

Key Terms in this Chapter

Openness: Quality of being open, transparent and available.

Transparent Organizations: Organizations that disclose information about its activities, process and all relevant information to its stakeholders.

Target Transparency: Selective disclosure of information by organizations to reduce risk or performance issues.

Opaque: Quality of an organization or data not being transparent, usually used as the opposite of transparent.

Disclosure of Information: The act of making relevant information about the organization readily available to its stakeholders.

Process Transparency: The existence of a defined organizational policies to disclose information to the stakeholders, subject to criteria of the information being accessible, able to be used, well presented, prone to be understood and auditable.

Transparency: The propriety of disclosing information to the stakeholders that is complete, reliable and understandable.

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