Transparency is Key to Increase Employee Retention and Reduce Turnover

Transparency and open communication drive employee retention and company success.

Time and again, secrecy sparks rumors, distrust, and turnover, while transparency drives understanding and buy-in. Employees who see openness as a core company value are 31% more likely to stay long-term.

I have seen it over and over in my long career.  And I have experienced it in my own employment journey as well.  The more an employer conceals and tries to keep secrets, the more employees feel like they are being cheated or the employer is hiding nefarious motives and initiatives.

Employees fill in blanks and humans love to gossip.  Juicy gossip is just part of life and it can derail a team, a department, or a company.  The best defense against rumors, inuendo, gossip, and doomsday prognosticating is transparency from the top. 

Let’s look at some research-backed examples across business functions and explore how to better offer transparency:


A study by Peakon found employees are 4.6x more likely to feel high trust and stay long-term when executives communicate company vision, challenges, and priorities clearly and frequently.  This can be from the top down, right from the C-Suite through middle management and to first-line supervisors.  You know the saying that people don’t leave companies, they leave managers? Well, this is the basic foundation of that philosophy. When employees don’t feel that they are trusted, compounded with management that seems shady or worse, untruthful, turnover becomes the ugly norm.

Goal Setting

According to Gallup, only 23% of employees strongly agree their manager keeps them up to date on goals and priorities. Consistent cascading of aligned objectives boosts retention according to this research.  Imagine a team of huskies pulling a sled.  Now, imagine that they aren’t all aware of the direction they are supposed to be going.  What happens when some go left and some go right?  Add to that the speed at which they need to run to get to the desired destination.  If some walk while others sprint, it is not helpful.  Every company is a team that is pulling toward certain goals.  When you allow them to pull in different directions because you aren’t sharing real results and realistic goals, they are going to cut loose. Either way, you will never get to your desired destination if your not vision sharing, defining goals and tracking progress.    


A Stanford study revealed employees underestimated their company's financial success when kept in the dark. Sharing metrics like revenue growth and profitability data inspires confidence.  When I was a young professional, one of the tech companies I worked for had a monthly all-hands meeting.  During that meeting, the CEO and COO would share the financial goals of the company and then the CFO would share our progress.  It was an energizing event to which everyone looked forward each month.  We were all excited about hitting the next big financial goal.  After we celebrated hitting $100 million, it became $500 million.  Every level of employee was aware of the goal and everyone tried to do their part.  It also made for employees in all functions seeking sales referrals and reaching out to their network to drum up leads.  That kind of transparency leads to success.  Employees tend to stick with employers that show promise of financial growth and success to which they can claim even some small part. 

Change Initiatives reported projects with transparent communication have 96% greater success in adoption and engagement.  Can you understand the power of that number? 96% greater success!  Just like corporate goals and financial milestones, company wide projects and improvement initiatives drive retention and productivity.  Foster ownership and buy-in from your employees with group input, contests for winning ideas, and public recognition for significant contributions.

Hiring and Promotions

Social gratification theory research shows perceived fairness of decision processes matters more than outcomes.  HR can be very helpful when it comes to crafting career paths that reward and recognize instead of just being a begrudging process managers go through on an annual basis.  Not to mention, managers often prevent their subordinates from promoting out of roles in which the manager finds them particularly useful.  Use titles and lateral skills training as a recognition and motivational tool.

Transparent criteria in hiring and promoting staff prevent rumors of bias.  Rumors of bias lead to… lawsuits when an employee feels wronged.  If you have to hire instead of promoting from within, be transparent with those you know will feel passed over.  Give them the criteria and the goals you are trying to fulfill.  Show them honestly where they fall short and then give them encouragement and tools to develop into the next promotable employee.  That will motivate them and appreciate the honesty.  It will also help them get behind the new hire and stay with the company as that new hire needs the institutional knowledge and support of those who were there before.

It may be hard to convince upper management to share some of these aspects of the business, but transparency around everything from company vision to individual feedback is proven to boost retention. By shedding light on priorities, metrics and processes, great leaders gain credibility and loyalty. I welcome the chance to discuss transparency best practices further.

Transparency around company goals, initiatives and decisions builds trust - period. Use the following tactics to get there:

  • Regular company-wide and team-level meetings to provide updates
  • Clear communication around policies and procedures
  • Involving employees in giving input on changes
  • Cascading goals from leadership so all levels align
  • Sharing metrics, financials, and business challenges
  • Admitting mistakes sincerely and sharing lessons learned
  • Gathering honest survey feedback and taking action
  • When leadership conceals information, turnover and disengagement follow.

Transparency shows respect for employees. It breeds understanding and problem-solving versus rumors. Honesty, even around setbacks.  Garner loyalty from your employee with these proven methods.

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