There’s a new feature on the online career community website Glassdoor.com; a symbol that appears when ‘the employer has embraced transparency and taken extra steps to engage with their employees’ via the site. Firms will now be rated on how seriously they take transparency, so not only will we get to see inside the company – the culture, the perceptions of the senior management, the downsides and even the pay bands – but we’ll see how comprehensively they respond to the picture painted by current and former employees. This is valuable, because employees want to know that the company they’re working for is committed to an open dialogue with its people.

While Glassdoor itself is only a small part of the puzzle for organisations, the concept of public dialogue it champions will become increasingly important to current and potential employees, stakeholders and regulators alike. Organisations will have to proactively engage with people and respond to assertions about their values, culture and conduct - or risk losing credibility, trust and ultimately loyalty.

More than anecdotal, this trend is supported by Hay Group’s latest research, which identified transparency as one of five key business challenges that organisations will need to tackle (both now and) in the future. In light of increasing pressure from employees, the public and politicians, companies need to adapt quickly to operate in a socially conscious and transparent manner. However, evidence suggests many are still reluctant to do so. Recently for example, only five UK companies responded to the ‘Think, Act, Report’ initiative by voluntarily publishing details on the gender pay gap amongst their employees.

Something to hide?

David MacLeod, Co-founder of the UK government led Engage for Success Movement, states that ‘companies will soon have nowhere to hide’. While his words ring true, for me the idea of having ‘something to hide’ is a signpost of the mindset that’ll have to change if organisations are to make transparency work positively for them. Authenticity must run through the company’s DNA and be translated into their day to day operations if transparency is to be seen as the opportunity it is rather than a business risk.

Returning to the example of the ‘Think, Act, Report’ initiative, Tesco was one of the five companies that did voluntarily publish gender pay gap information. This bold move reflected positively on the retailer for two reasons; firstly because their pay gap is much lower than the national average (1% to the UK average of 10%), secondly because publishing any information like this is a risk – but in taking the risk they displayed an authentic commitment to being a responsible and fair employer.

The game changer

Digitisation has changed the game and raised the stakes. Now companies and their employees can reach millions of people in seconds, on platforms designed to promote hyper-transparency. Where their experiences don’t align with the image a business promotes of itself, there is an elevated risk that transparency – be it forced or voluntary - could backfire and cause reputational damage, both as an employer and in the way customers perceive them. Those that get this alignment right should expect to bolster their reputation with the people they depend on.

What can we do about it now?

The idea that a company’s employees are its most influential ambassadors has been amplified in the connected world. Addressing transparency internally and committing to it will help employees feel as though they are a trusted and integral part of the organisation’s success, with a clear vision of how they play into the future direction. Here are some ideas:

1. Make pay information available internally - One of the more successful ways of doing this is to publicise pay bands.
2. Make it clear what people need to do to reach the next level or achieve their career goals - Having consistency across the organisation through calibrated performance assessments and promotions criteria is important in letting people know what to do to progress.
3. Consider your organisation’s response to opportunities like the Think, Act, Report initiative back to Glassdoor.com – consider the impact that an unclaimed employer profile might have, especially when compared to a competitor that might be engaging current and potential employees using this powerful platform.

 

By Marc Sowik, consultant at Hay Group.


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