As we prepare for the publication of our 2019 Top 10 Ethics & Compliance Trends Report, a common thread has become evident: transparency. Whether it be a company’s data use practices, its response to sexual harassment, or its efforts to eliminate atrocities like human trafficking from supply chains – transparency will define our industry’s challenges and opportunities in 2019.
This has positioned employees, consumers, and the public at large as the arbiters of business success.
Consider the “belief economy” businesses operate in today. More so than just product specs, consumers are buying based on brand authenticity and ethical business practices. People want to work for, buy from, and support companies that they believe will create ethical ripples beyond the transaction. This has positioned employees, consumers, and the public at large as the arbiters of business success. Even more than regulators, these groups have disproportionate influence over our brand reputations, and often have higher standards.
In this belief economy, employees want to believe in the mission of their employers, extending to not just what the organization does, but also how it does it. Consumers are voting with their dollars to stand in support or opposition of social movements, not just physical products. The public at large wants to be the force of corporate accountability. And shareholders know all this and understand the bottom line will be dependent on how we operate within these new norms.
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This demand for transparency is a byproduct of the abuse of privacy on the behalf of corporations. Whether it be the use of NDAs to suppress stories of harassment; cavalier processing of personal data; or blind eyes turned to fraudulent business practices, corporate institutions are facing a wall of skepticism. This is not to say that all are at fault. But the reality is that the few have changed the landscape for the rest, and all will be met with greater skepticism and pressure for transparency as a prerequisite for future business.
Viewed from the other side, we are driving toward a culture of accountability. Here, protections like privacy and confidentiality that previously insulated organizations are now inciting additional scrutiny. Concealing unsavory corporate circumstances and the ensuing disciplinary action (or inaction) is no longer always in a company’s best interest. Corporate observers see unchecked privacy and confidentiality as the antithesis of transparency, and also a gateway to ethical complacency. Often they are right. Whether by intent or neglect, privacy allows room for inaction.
Transparency on the other hand provides a powerful change agent in the form of employee, consumer and public accountability.
We cannot forget, however, that transparency is not the goal, but a means to an end – that end being trust.
In today’s climate of distrust (fake news, unmet promises, and corporate misdeeds), there is an opportunity for corporations to take a leadership role and rebuild trust in their words and brands through action and commitment.
For that we need to be transparent in our business dealings, in our employee management, and our public relations. That is how we will regain trust and remain successful in the modern belief economy.