Magazine article Government Finance Review

Transparency Breeds Self-Correcting Behavior

Magazine article Government Finance Review

Transparency Breeds Self-Correcting Behavior

Article excerpt

In 1997, a film crew took a hidden camera into several Los Angeles restaurants because of reports of poor health practices. They filmed rats in storage areas, food that wasn't refrigerated, waiters "re-serving" food from one customer to another. When the video aired, people were outraged. The result: The Los Angeles County Board of Supervisors passed a law requiring every restaurant to post the letter grade it received from the county's health inspection. The grades had to be prominently posted in the front window, next to the menu. A restaurant that doesn't get at least a C is closed.

Follow-up studies showed that business at the "A" restaurants went up and that "C restaurants lost revenue after the system took effect. Over the next decade, the percentage of restaurants receiving A grades went from 25 percent to 50 percent of all county establishments, while the percentage of C restaurants declined from 18 percent to less than 2 percent. Most significantly, there was a 20 percent reduction in the number of people hospitalized for food-related illnesses.

The LA. restaurant story is a good example of one of my favorite quotes: "Transparency of information breeds self-correcting behavior." It comes from Thad Allen, Commandant of the U.S. Coast Guard, and influenced this column. In the L.A. example, the "self-correcting behavior" took place at two levels. Restaurants self-corrected by changing their health practices, and consumers changed their behavior. Sixty-five percent of consumers reported being influenced by a restaurant's grades, which is reflected in their move from lower-grade to higher-grade restaurants.

Thad Allen doesn't just talk about transparency, he practices it. When he was put in charge of search, rescue, and recovery 10 days after Hurricane Katrina hit the Gulf Coast, Allen made an enormous impact on the way government agencies were working (or not working) together. He radically opened up communications by creating daily meetings with the leaders of each partner agency, and he briefed the governor and mayor at least once a day on current conditions and the day's plan.

Allen also opened up the recovery process to the media. He was very candid concerning what was going well and what wasn't, never raised expectations unrealistically, and invited the media to become partners in telling the public what was going on and how it would affect them. Coverage of the recovery operations slowly improved as people came to trust Allen for his candor and effectiveness.

Public agencies benefit in many ways when they operate more transparently. Employees feel more accountable for their behavior; there's greater 'focus on performance and outcomes; and the public has more knowledge of an agency's operations and how to access them:. …

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