Organizational Transparency: An Introductory Guide for the Perplexed

May 11, 2015 by

Guest post by Gina Schmleing

“Openness is the chief virtue of the digital age.”

- Virginia Heffernan, “Magic and Loss: The Pleasures of the Internet”

Transparency itself isn’t a new concept. In the US for example, nonprofits must publicly file 990s annually. This ensures accountability, and is a requisite for tax-exempt status. But transparency does not begin and end with financial information. There are new dimensions, new imperatives emerging from technology, and perhaps most profoundly, transparency is now a critical leadership skill. That feels pretty new to many of us.

But today’s leaders need to understand that transparency is no longer optional.  When the rules of the game have changed, leaders necessarily need to adapt their approaches. What roles does transparency play here? According to Charlene Li, author of Open Leadership, “transparency is not defined by you as a leader, but by the people you want to trust you and your organization. How much information do they need in order to follow you, trust you with their money or business?” (pg. 193).  It’s all about trust — and trust (and its corollary, attention) are the currency of our current attention economy.

Understanding that transparency is a critical value and essential element of effective leadership has powerful implications for organizational sustainability too. Previously, organizations literally served an ‘organizing’ function. Institutions held the data, finances and authority. Today, individuals are self-organizing and shifting the power center. Jeremy Heimans and Henry Timms decode this in their HBR article “Understanding ‘New Power’”. Simply, “the goal with new power is not to hoard it but to channel it.” As society is increasingly skeptical and rejecting of old structures, transparency becomes even more important. It becomes a way to activate and channel new power.

Some people mistake transparency for cracking open your financials and letting it all hang out. But it isn’t just about opening up your books or making leaders function as if they are naked. Transparency (of any sort) is values-based, centered on respect (hakavod), virtues (middot), and, the big one, truth (emet). Think about your relationships with your spouse, business partners, and good friends.  Yes, there’s the planning — taking kids to soccer, paying the bills, making doctors appointments. But what if you didn’t trust your partner, and had little input in decisions? The logistics would be joyless. Strong relationships are built on respect, honesty and open communication (transparency). So too relationships with our donors, members, volunteers and advocates.

Jed Miller, who helps human rights organizations align mission and digital strategy, says that “Institutions may be afraid that by opening up about internal processes they give critics a map of their weak spots.” He warns that this kind of initial fear is inherently limiting. “The key,” he says, “is to think about your public—however you define them—as participants in your mission, not as targets or threats.”  What kind of insight — into processes, decision making, etc. — is needed for them to trust you as a champion of the cause?

When we, as leaders in the Jewish world, hold ourselves and our leadership apart from the community, how can we expect to engage our communities with full and sanguine spirit?  We cannot hide or disable conversations, or operate in a vacuum and expect the public to consistently trust us with their dollars. Those days are over. Today, we need to embrace these values of open leadership.

Organizational transparency is where Jewish wisdom nests with innovative thought. I’ve spoken to rabbis about salary transparency, and searched Jewish orgs with high ratings on charitable indices. Comparing synagogue websites, I’ve sought open plans, board minutes and budget spreadsheets.  While there are bright spots, the norm is much more closed and opaque. In the Jewish professional community, we tend to compare ourselves to each other to establish a norm, when in fact we need to be widening our gaze to understand the role and importance of transparency in today’s marketplace. My sense is that the Jewish world is not keeping up, or worse, we are not pushing ourselves forward. It is time that we recognize the shifting norms, acknowledge the benefit to our organizations and community as a whole, and take real steps to integrate transparency into our normative business practices.

In a time when many Jewish organizations are seeking to get more people to trust and follow them, we must heed Open Leadership author Charlene Li’s words of wisdom. Transparency is the information people need in order to follow and trust you as a leader, or as an organization. While leaders may be initially resistant to the idea of transparency, we must all take it seriously to build strong, sustainable and vibrant communities.

Stay tuned for future posts on specific examples of how various leaders are putting this ethos into action.

Screen Shot 2015-05-11 at 9.37.41 AMGina Schmeling is a non-profit consultant based in Brooklyn. Find her at @nyginaschmeling or in the park with the runners.

Leave a Reply