This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Why Are So Many Companies Missing the Boat on Corporate Transparency?

By Andre Lavoie

SAN FRANCISCO (TheStreet) -- Transparency is important to ensure your best people are moving in the right direction. Yet many companies erect barriers between their best people and put up roadblocks obstructing company goals from view.

"Corporate transparency" doesn't refer just to what investors and activists will see in a filing with the SEC; it also means having a clear line of sight through your company, so upper management understands the allocation of their people and employees understand the purpose of their company.

True company transparency isn't easy to attain, but it can save your bottom line. Consider the average company with only 100 employees -- hardly a large business -- spends up to 17 hours per week just clarifying communication. In dollars, this translates to an annual cost of $528,443 in miscommunication and lost productivity.

This doesn't even take into account employee engagement, which is at an all-time low. When employees can't see how their work contributes and don't understand their place in the company, they disengage from their efforts. According to Gallup, low employee engagement costs the economy upward of $550 billion a year.

Must Read: 5 Professions Most Likely to Make You a Homeowner

Missing the boat on all kinds of corporate transparency is costly. Here are a few steps you can take to ensure your team stops working in a fog:

Trust that transparency works.

The No. 1 reason to foster transparency in your company? It works when it comes to engagement, productivity and your organization's bottom line. After all, if transparency didn't work it wouldn't be a buzzword, nor so rapidly adopted by so many companies.

For an example, just look at startups and tech giants embracing the open office floor plan with equally open arms. These companies hope setting up their office in a transparent way will help improve organizational transparency.

Take social media company Buffer. The company has loudly and repeatedly explained how its focus on transparency has helped engage employees and drive workflow. At Buffer, all salaries are public and employees use real-time tracking to keep work aligned. The company is making more than $1 million annually now and executives attribute its success in part to a transparent organizational structure.

You might also want to consider technology retail giant Best Buy. The company noticed the importance of employee engagement -- at an all-time low with 70% of American employees disengaged from their jobs -- and implemented employee engagement initiatives. Tracked carefully, the results found a 0.1% increase in engagement translated into more than $100,000 in one store's operating budget.

Engagement matters, and having a transparent organization in which employees understand their value drives this engagement.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.21 -0.44%
FB $117.80 -0.22%
GOOG $701.26 0.80%
TSLA $211.34 -5.00%
YHOO $36.94 2.61%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs