Team of employees in an open office with one person standing at the head of the table leading the discussion.
Transparent leadership has the potential to foster confidence among employees and improve overall employee performance. — Getty Images/Morsa Images

Impactful CEOs and founders can vary in their leadership styles, but one thing most of them have in common is transparency. Open, honest communication is a foundational part of good business relationships and team dynamics, so leading with transparency can ultimately have a positive impact on your business.

Benefits of being a transparent leader

  • Increased employee performance. Being open and transparent with your employees increases employee engagement. This encourages them to succeed through higher performance and productivity while developing a healthy team culture. Employees will feel encouraged to collaborate with their team, share ideas with their managers, and feel a sense of belonging within the workplace.
  • More empowered, confident employees. When you develop a culture of honesty and sharing, it allows employees to feel secure enough to advocate for themselves at work. Employees will feel more confident when speaking up and sharing their needs, expectations, and ideas. As you develop value and trust around your employees’ feedback and reflection, you are more likely to have a healthier and more successful working environment.
  • Clearer expectations for your staff. Providing unclear information and directives can create a culture of mistrust, frustration, and unneeded gossip. In addition, it could lead to further misunderstandings and confusion among team members, creating a toxic and stressful work environment.

[Read More: 10 Business Leadership Styles and What They Mean]

How to be a transparent leader

Set clear expectations

To build a culture of transparency, set clear expectations with your employees. Incorporate tools your team can use to communicate with you and consider how you will share company updates and build an effective feedback loop. This may include hosting weekly team meetings, providing updates during performance evaluations, or having informal one-on-one time to better understand your employees’ needs.

In addition, think about how you’d prefer to receive and share information with your team. Then, set this expectation for your employees so everyone is on the same page.

As you develop value and trust around your employees’ feedback and reflection, you are more likely to have a healthier and more successful working environment.

Openly discuss your company’s goals and future

Being open about the status and future of your company allows your team to clearly see where they fit within the company’s vision to further build upon their current role and look forward to future promotions. These changes may even lead to a strong sense of belonging, boosting retention rates. Another option is to carve out time for sharing mutual goals and ideas outside of one-on-one check-ins or team meetings.

Be honest about any challenges your company is facing

If your company is facing challenges, share with your employees as much information as you’re comfortable with to further cultivate a safe space and camaraderie during difficult times. By communicating not only positive updates but also company challenges, your team will better understand the status of the company and buy into the company mission.

You might assume that keeping your company’s challenges a secret will protect your employees from stress and anxiety, but it could actually create a sense of distrust and uncertainty when they find out you’re hiding important updates from them. When you open up about your business’s vulnerabilities, your employees can share valuable feedback and resources so you can make better decisions as a leader.

Create a space for feedback

As a leader or manager, it pays to hear from employees how your leadership is impacting them. Holding mutual performance evaluations can be a positive way for your employees to share what has or has not been working. Additionally, utilize tools or survey forms that allow your employees to also share feedback anonymously. Consider connecting with your HR department about the best way to collect feedback.

Honor your commitments

Leading with transparency means honoring your commitments even when you’re forced to make difficult decisions. Be cognizant of ways to be open and honest with your team while avoiding gossip and personal information. Stick to sharing information that best supports the future decision-making of your employees.

[Read More: What Is Servant Leadership?]

CO— aims to bring you inspiration from leading respected experts. However, before making any business decision, you should consult a professional who can advise you based on your individual situation.

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