Glossary term
Transparency
Subject: Governance, Corporate Governance
Also known as: Openness
Transparency is the practice of making decisions, rules, performance and risks visible to people with a legitimate interest, so they can understand and question what an organisation or public body does.
Explanation
In governance, transparency means information is open, timely and understandable, and not merely available on paper. For a company it covers accurate financial statements, disclosure of ownership, pay and related-party dealings, and plain reporting of risks. For public bodies it covers published budgets, contract awards and access to official records. Public reporting is the usual channel: annual reports, regulatory filings, sustainability reports and websites. Transparency has limits, since trade secrets, personal data and security can justify holding information back. It also differs from dumping large volumes of data that nobody can read. Investors and regulators treat it as a precondition for accountability, because people cannot challenge what they cannot see. Auditors and journalists tend to start with what was never published, since gaps in disclosure are where misuse hides.
Example
A municipal council publishes every contract above a set value on its website, with the winning bidder, the price and the scoring sheet. A local journalist notices that three awards went to related firms and asks questions. The council reviews the awards and tightens its rules on declaring links with bidders.
Not to be confused with
- Disclosure
- Disclosure is the act of releasing specific information. Transparency is the wider condition of being open and understandable to those affected.