One of the responsibilities of leadership is deciding what information to share with your employees. As I've written before, "Leaders must handle significant amounts of confidential information with discretion and tact while maintaining others' trust." [1] While current management practice favors greater openness, even Ray Dalio, the founder of Bridgewater, the world's largest hedge fund known for the "radical transparency" of its culture, acknowledges that leaders must withhold some information:
Radical transparency isn't the same as total transparency... We do keep some things confidential, such as private health matters or deeply personal problems, sensitive details about intellectual property or security issues, the timing of a major trade, and at least for the short term, matters that are likely to be distorted, sensationalized and harmfully misunderstood if leaked to the press. [2]
A simple way to talk about this with employees who want more transparency is to acknowledge that all information falls into one of three buckets:
1) What You Know and Can Share
(This is the easy one.)
2) What You Know and Cannot Share
It may feel risky for you to acknowledge the existence of this bucket, because it invites curiosity about what's inside. So it's worth asking yourself why you're choosing not to share this information. Management consultant Peter Block offers a rationale while addressing employees concerned about insufficient transparency:
If management knows something and is not telling us, it may be because they are worried about our feelings. They have heard our plea for protection and fulfill our request by withholding information that might make us anxious... If we want protection, we will pay the price by living in the dark. The moment we give up the protection, we will get the real story. [3]
You may have a range of reasons for withholding information, but in my experience as a coach this is the most common, and on some level it's a factor in all situations where confidentiality is an issue: leaders are worried about employees' feelings. While Block is challenging employees to take more responsibility for their experience and be less emotionally dependent on management, you should also feel challenged as a leader.
In some cases the withholding of information is entirely justified, and there would be a high cost if it were shared, but there's also a cost if you always err on the side of discretion. Information-sharing is a form of truth-telling, and if you never test your employees' capacity to handle the truth, you limit their growth and their potential contributions. At the same time, withholding information is a form of self-censorship, and as I've written before, "censoring ourselves is stressful and generates negative feelings [and] we will inevitably blame those negative feelings on those who 'made us' censor ourselves." [4]
I'm not suggesting that nothing belongs in this bucket--it exists for good reason, as Dalio points out above. But is your decision to withhold information truly necessary? Or is it merely a "defense routine," which the late Harvard Business School professor Chris Argyris defined as "actions or policies that prevent individuals or segments of the organization from experiencing embarrassment or threat." [5] When defense routines govern an organizational culture, when it is insufficiently safe to discuss any issue that might trigger embarrassment or threat, then candid communication becomes impossible, and performance inevitably suffers.
3) What You Don't Know
It may feel vulnerable for you to acknowledge the existence of this bucket, particularly if you face expectations (from your employees, your peers or yourself) that an effective leader should be more knowledgeable than anyone else in the organization. But when we're honest with ourselves, we have to admit that this is the biggest bucket by far. Peter Block continues:
The more likely reason we do not hear the real story directly from management is that often they don't know it. They don't know what will happen to us, our unit, our organization. They can't predict the future any better than we can. It is the child in us that believes that our bosses know everything. What we want from them, they just do not have. [6]
Admitting the vastness of our ignorance can be uncomfortable, but until we do we're fooling ourselves--true wisdom lies in realizing how little we know. [7] I'm not suggesting that you disclose gaps in your knowledge that would cause employees to lose faith in your ability as a leader--but I am suggesting that you consider the cost of failing to disclose any gaps.
Employees tend to overestimate how much a leader actually knows, in part because we habitually fail to "empathize up." [8] But as a consequence they're less likely to volunteer information that they believe the leader already possesses, and they may assume that any information they don't have is being actively withheld from them. When you step into the vulnerability inherent in saying, "I don't know," you make it more likely that people will help you to fill that gap, and you increase their faith in your trustworthiness. This also contributes to a greater sense of psychological safety, a topic studied by Harvard Business School professor Amy Edmondson:
No one wants to take the interpersonal risk of imposing ideas when the boss appears to think he or she knows everything... Humility is the simple recognition that you don’t have all the answers, and you certainly don’t have a crystal ball. Research shows that when leaders express humility, teams engage in more learning behavior. [9]
Intentions vs. Judgment
Your ability to hold a fruitful dialogue with employees about information-sharing, transparency and confidentiality will be determined by their trust in you as a leader--but note that trust is not a monolithic quality. As I've written before, we assess people as trustworthy (or not) on two dimensions, their intentions and their judgment:
When we trust someone's intentions but doubt their judgment, it's usually easier. We can provide clearer guidance, offer more support, and strive to avoid miscommunication, while also determining whether their lack of judgment is a fatal flaw, a fixable problem, or an illusion based on inaccurate data.
When we trust someone's judgment but doubt their intentions, it's usually harder. We can limit our engagement with them and minimize our exposure to risk, while also determining whether their bad intentions are truly malevolent, merely opportunistic, or just a misunderstanding. [10]
If employees distrust your judgment when it comes to making decisions about information-sharing, that's certainly a challenge, but it's possible to have a healthy debate about the respective rationales for your decisions and their preferences. You may ultimately agree to disagree, but you can still have a productive working relationship. It's a much more serious problem when employees distrust your intentions in these matters--and this is where the metaphor of the three buckets may provide a helpful starting point for discussion.
Footnotes
[1] Leadership and Authenticity
[2] Principles: Life and Work, page 331 (Ray Dalio, 2017)
[3] The Answer to How Is Yes: Acting On What Matters, pages 112-113 (Peter Block, 2003)
[4] Risk Management (The Importance of Speaking Up)
[5] Overcoming Organizational Defenses, page 25 (Chris Argyris, 1990)
[6] The Answer to How Is Yes: Acting On What Matters, page 113
[7] The three stages of expertise (Simon Wardley, 2008)
[8] The Difficulty of Empathizing Up
[9] How Fearless Organizations Succeed (Amy Edmondson, stragegy+business, 2018)
[10] Two Sides of Trust
Photo by Adele Prince.