The role of transparency in markets and society

One of the main reasons this corruption can flourish. Countries have a lack of transparency when it comes to work being done by government contractors operating on an hourly basis. In virtually every country, government contractors work on an” honor system” where there are no procedures in place to verify invoices for the hours worked by these contractors (Konanykhin, 2018). The lack of transparency can affect organization and country’s productivity and economic growth, it is a corruption risks for the public sector. All organizations, regardless of the industry, should work for transparency. Management transparency can contribute to employee happiness. A company that is less than transparent may be perceived as trying to hide something, even if that is unfounded.

Transparency Fundamentals

Today, when fact-checking can be accomplished via the internet, it’s a wonder that we’re even talking about the need for transparency. However, transparency remains a buzzword in today’s society, transparency in government (such as sunshine laws), transparency in politics (revealing sources of donations), transparency in finance (SEC regulations), transparency in relationships (Kozloff,2019).Transparency is a fundamental element to fulfilling the Treasury’s mission of maintaining a strong economy and creating economic and job opportunities. Further, transparency strengthens national security and protects the integrity of financial system, controlling corruption is possible only when government, citizens, and the private sector cooperate to ensure transparency (Glaser, 2016). A financial statement with transparency should be clear and easily understandable, financial statement is very important for any category of business, it is the summary of a whole period performance. A financial statement should give a positive impact to its readers, clear data should be disclosed honestly. When the financial statement is not transparent, it becomes difficult for the investors to calculate the risk factor and the profitability ratio.

Transparency Implementation

Financial transparency goes beyond the role of financial institutions alone. That is why the Treasury also focuses on improving the transparency of companies themselves (Glaser,2016). Transparency is also a critical part of our economic diplomacy efforts. One of the crucial elements of sustainable economic growth and job creation and of a vibrant and entrepreneurial private sector is transparent governance (Novelli,2016). To implement good transparency countries must do a lot of work to effectively implement their laws and work to advance financial transparency. Countries around the world must create environments that are hostile to all financial crime, including corruption. Investors and customers are more comfortable to deal with a company or a country when they have a clear understanding of the company’s transparency.

It is much more difficult for government to divert off-budget expenses when they adhere to standards of fiscal transparency. There is less of an opportunity for bureaucrats to shakedown companies when business regulations are clear and red tape in minimal. Stakeholder transparency also helps ensure that privileged groups do not benefit backroom deals at the public’s expense (Novelli,2016). Transparent and efficient governance helps create business-friendly ecosystems. Transparency brings value for companies as well as investors. Being transparent is a good way to do business. Companies might have an official transparency policy, transparency help to build trust and growing your business.

Transparency and trust 

I believe that more companies will see success if they begin to view their customers as essentially an extension of their internal operations teams. The actions of a single morally corrupt company have the power to paint an entire industry in a bad light. But when you practice transparency, you do not need to worry about being tainted by association when a company in your industry does something that lacks integrity (Craven, 2015). Some companies ignore that it is necessary to be transparent in their financial report, this put them as higher risk investment with the possibility of lower returns. Transparency can help economies work better and makes them less vulnerable to crisis. It is crucial for the efficient functioning of a modern economy and for social well-being. Transparency must be open, honest, and accessible communication. Transparency affects trust, communication with publics has increased because of communication tools. The interactivity should serve to increase transparency and trust, relationship cannot be built without trust. 

Fregens DONATIEN

MScM, Master of science Management, Eastern Nazarene College, Massachusetts USA    

Doctoral Student, Doctoral Business Administration (DBA), Liberty University, USA.

References :

Kozloff, J. (2019). Five reasons why transparency is Good Business.www.Forbes.com

Konanykhin A. (2018). How transparency can help the global economy to grow. World economic Forum.www.weforum.org

Glaser D. (2016). The role of transparency in fighting corruption in financial systems.  www.atlanticcouncil.org

Novelli, C.A. (2016). The Role of Transparency and how it Can Spur Global Prosperity and  Sustainable Economic Opportunity at Home and Abroad. https://2009-2017.state.gov

Craven, R. (2015). Let’s Be Real: Why Transparency in Business Should Be the Norm. www.entrepreneur.com