“Transparency is one evidence of an organization’s moral health… Openness is not just a virtuous policy that makes the organization feel good about itself…. Openness and what it says about the nature of the organization becomes a competitive advantage—in creating consumer loyalty as well as in recruiting and keeping the best people.” Transparency, Warren Bennis, Daniel Goleman and James O’Toole.

“Until recently, the yardstick used to evaluate the performance of American corporate leaders was relatively simple: the extent to which they created wealth for investors. But that was then. Now the forces of globalization and technology have conspired to complicate the competitive arena, creating a need for leaders who can manage rapid innovation. Expectations about the corporation’s role in social issues such as environmental degradation, domestic job creation, and even poverty in the developing world have risen sharply as well. And the expedient, short-term thinking that Wall Street rewarded only yesterday has fallen out of fashion in the wake of the latest round of business busts and scandals.
“It’s clear we need a better way to evaluate business leaders. Moving forward, it appears that the new metric of corporate leadership will be closer to this: the extent to which executives create organizations that are economically, ethically, and socially sustainable….
“When we speak of “transparency,” we mean much more than the standard business definition of the term—full disclosure of financial information to investors. While such honesty is obviously necessary, that narrow interpretation produces an unhealthy focus on legal compliance to the exclusion of equally important ethical concerns, and on the needs of shareholders to the exclusion of the needs of other constituencies. Worse, it’s predicated on the blinkered assumption that a company can be transparent to shareholders without first being transparent to the people who work inside it. Because no organization can be honest with the public if it’s not honest with itself, we define transparency broadly, as the degree to which information flows freely within an organization, among managers and employees, and outward to stakeholders.
“Companies can’t innovate, respond to changing stakeholder needs, or function efficiently unless people have access to relevant, timely, and valid information. It’s thus the leader’s job to create systems and norms that lead to a culture of candor.”
by James O’Toole and Warren Bennis