A construct development of consumer perceived organizational transparency within relationship marketing

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A construct development of consumer perceived

organizational transparency within relationship marketing

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Ghislaine Stasia Audrey Elisabeth Allard

Studentnumber: 10003632

Master thesis

Date of submission: 29-06-2015

MSc. in Business Administration – Marketing track University of Amsterdam

Supervisor: Joris Demmers MSc. Second supervisor: Dr. Alfred Zerres

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Abstract

Transparency has become more important to companies as the relationship between firm and consumer is rapidly changing towards a symmetric relationship. However, companies have no possibility to measure their own consumer perceived organizational transparency. This paper focuses on the development of a construct, which can measure consumer perceived

organizational transparency within the relationship marketing. Practitioners nor academics can no longer ignore the upcoming importance of transparency.

First, the definition of organizational transparency is defined by literature review and a focus group. A pre-test is done to check the reliability of the items that were gathered from the literature review and the focus group. Then an item scale is pretested, developed and tested by a questionnaire. The results (N=143) indicate that the construct of consumer perceived

organizational is built upon 25 items by the following dimensions: “Symmetric relationship of purposeful and visible information”, “Emotional trust-based relationship”, “Consumer

information needs” and “Trustworthiness of information.” Implications of results are discussed.

Statement of originality

This document is written by Student Ghislaine Allard, who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in

the text and its references have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the

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Introduction

Nowadays, consumers have become more critical about what they like and purchase. This is a consequence of the changing role of the consumer. Internet and customer reviews have greatly empowered consumers (Labrecque et al., 2013). Consumer have more choices, the consequence is that they are less satisfied with standard products or services they purchase. Companies however, have more strategic options that will yield less value to consumers. This twin paradox describes the economy of the twenty-first-century (Prahalad & Ramaswamy, 2004). Therefore, companies need to create a greater value for their consumers. Fourney and Avery (2011) state that companies are now in the ‘Age of Transparency’. They state that companies have learned it is best to be in front of all matters that have impact on the

positioning of the brand. Earlier research states that organizational transparency is linked to positive organizational outcomes (Brown, 1995; Kern, 1999; Stirton & Lodge, 2001) as it may be translated into market leadership (Dingwerth & Eichinger, 2010) and so it is important for a company to know how consumers perceive their company; are they transparent

(enough)? Transparency can give consumers insights in the intentions of a firm and maybe even take away the skepticism of a consumer by providing them with information about the intentions of the firm; to which extend they are firm-serving or public-serving. These two-way symmetric public relations rely on honest and open two-two-way communication of

companies and consumers. It focuses on a ‘give –and-take’-relationship rather than a one-way persuasion of either side. This, however, emphasizes negotiation and willingness to adapt. Both parties may have to make some compromises (Holmstrøm, 2005). Relationship

management is a symmetric public relation approach and stands for the management function that establishes and maintains mutually beneficial relationships between an organization and the publics on whom its success or failure depends (Ledingham & Brunig, 2000).

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6 so the relationship management can adjust the strategy and being more transparent when they know how transparent they are perceived by the consumer and whether the firm is perceived to be firm-serving or public-serving. This knowledge about the consumer is important. When a company understands what the consumer wants to know about the company, they can focus on these needs and this would enhance the relationship in a positive way.

Therefore, it is highly important for a company to choose a strategy, which will lead to a big amount of perceived transparency of the firm by consumers as it leads to positive

organizational outcomes, as mentioned before. However, there has been no research that allows companies to use a scale for the measurement of their own transparency, which focusses on consumers. However, there have been researchers who have come up with an instrument to measure the perceived organizational transparency of stakeholders. For instance: Rawlins (2008) took the work of Balkin (1999) and developed an instrument to measure perceived organizational transparency based on the guidelines that were given by the Global Reporting Index (GRI), the Public Relations Society of America Code of ethics

Provision on Disclosure and the Governmental Accounting Standard Board. This instrument was build up from two dimensions. The first was about the openness of the organization, the respect that the company has for others and the amount of integrity that a company shows. The second dimension was about the efforts an organization took to be transparent. This was measured by secrecy, accountability, substantial information and participation. There was however another researcher that investigated the perceived organizational transparency, however this time not from the perspective of employees (as Rawlins (2008) did), but of the consumers. Hustvedt & Kang (2013) developed a construct, which was a one-dimensional scale. They used a scale based upon the items: reliability, sincerity, and honesty. However, Hustvedt & Kang (2013) developed a measurement, which is focused upon the relationship between transparency, social responsibility, purchase intention, trust, word of mouth and

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7 attitude. These two studies did not formulate a definition of the perceived organizational transparency and did not primarily focused upon only the perceived transparency of consumers. This research will focus upon the relationship between organization and the consumer and develop a definition for organizational transparency. This gap is, however, a great opportunity for managers, especially PR practitioners.

Whenever a PR practitioner can reveal the weak or strong spots regarding the

perceived organizational transparency of consumers, they can help to improve or strengthen these perceptions. Furthermore, a consumer wants a company to be transparent. This will force them to show the organizational weaknesses and areas that need improvement. The need for transparency of consumers forces companies to improve their behavior (Rawlins, 2008).

The primary goal of this thesis will be the development of a scale to create a valid measure of perceived organizational transparency by consumers. This enables a firm to measure this important part of relationship marketing which will lead to positive organizational outcomes. There is, as said earlier, not yet a construct that provides practitioners with a proper measurement of perceived firm transparency by consumers. Therefore, the following research question will be answered:

RQ: How is consumer perceived organizational transparency within relationship marketing

defined and how can this consumer’ perceived organizational transparency be measured by a construct?

A literature review will help to develop a clear definition of organizational transparency and to see which factors are causing perceived organizational transparency for consumers. When this is been done, a focus group will be organized to discuss the definition of transparency of a company. With the results of the focus group and the already gathered literature, the domain of the construct will be developed. With this domain a survey will be made and spread among the respondents and be analyzed. Furthermore, the construct will be developed and discussed

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8 in the results and discussion part. A brief conclusion and recommendation for future research on this topic will end this thesis.

Literature review

It is essential to begin with a clear conceptualization of the target construct: consumer

perceived organizational transparency of a firm within relationship marketing. The definition of organizational transparency will be discussed by showing the definitions of organizational transparency among different industries.

Organizational transparency, the definition

There are several definitions of organizational transparency. First off, to start with the

dictionary of Oxford (2015), transparency is derived from the word ‘transparent’. This comes from ‘trans’ and ‘parere’ (Medieval Latin), meaning ‘through’ and ‘visibility’. In a purely physical sense, it means that there is transmission of light so that transparent items can be seen through (Barth & Schipper, 2008). In a business context, a clear definition is given by the Cambridge Business English Dictionary (2015), which defines the transparency

phenomena as “a situation in which business and financial activities are done in an open way without secrets, so that people can trust that they are fair and honest”.

The first researcher that used the term ‘transparency’ as the definition which is nowadays familiar for science, was not a native English speaker, but an academic from Denmark, Svendsen (1962). He defined transparency as ‘macro-economic transparency’. This definition found his way in the 1980’s, as an accounting principle, within the niche ‘financial

transparency’. The visibility of this information, contrasting with its absence, was the beginning of new public policy advocates and scholars (Michener & Bersch, 2013).

Tom McManus (Lazarus & McManus, 2006) states that transparency is a simple concept, but the practical implication is not. He states that transparency is build up from many factors; security, truth, openness, access to information and privacy and that transparency

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9 cannot be seen as one factor; it will be influenced by other factors. Several factors and

industries will be discussed.

Legal perspective

Transparency is needed. Public participation is essential to democracy and participation depends on information. Freedom of information and freedom of information accessibility are foundations of democracy (Searson & Johnson, 2010). That is the reason why transparency is so important. We live in the age of information; however, this has not always been the case. Since the fall of the ‘Iron Curtain’ over forty countries have been developing ‘right to know’ laws, which gives individuals and organizations the legal right to get to know what the government is doing. This explosive growth of these kind of laws were mainly the effect of international activists. As those laws developed, more specific laws, also for organizations were adopted (Banisar, 2006). Countries are encouraged by The United Nations Conventions on Anti-Corruption to be more transparent because that will battle corruption. Banisar (2006) also states that transparency has been captured within the laws that cover freedom of

information. Government and ministers that oversee health, environment, transportation, law enforcement and communications are making sure that those laws are being followed and that they, but also organizations are transparent when it comes to information.

From a communication perspective which also at the same time includes the stakeholder-driven view, Rawlins (2008, p. 75) defined transparency (inspired by previous work of Balkin (1999) as follows: “the deliberate attempt to make available all legally releasable information – whether positive or negative in future – in a manner that is accurate, timely, balanced and unequivocal, for the purpose of enhancing the reasoning ability of publics and holding organizations accountable for their actions, policies and practices”. Transparency has been important for laws, but has also found his way into several business elements. And although the concept of transparency is relatively novel in the field of

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10 marketing, there is a substantial body of literature on transparency within these different business elements.

Marketing

Marketing is one of the most important business elements of the company when it comes to transparency. The marketing managers can influence the perception that consumers have about the transparency of the organization. Marketing managers need to make sure that they will fulfill the needs of the consumers regarding transparency and will (keep) buy(ing) the products or services of the organization. A strategy needs to be developed to meet this goal of excellent consumer perceived organizational transparency. Within marketing, the

organizational transparency is compared to purposeful information disclosure (Chen et al, 2010; Press & Arnould, 2014; Yang & Lim, 2009), but also about visibility and accessibility of information (Merriam-Webster, 2010). As Fournier and Avery (2011, p. 198) stated about transparency: “Everything that can be exposed, will be exposed”. To deal with this way of using transparency is easier said than done. Marketing managers need to make sure that they satisfy the needs of the consumers regarding transparency, but they have to keep in mind that the competitors can also gain from this transparent behavior and that information can also have a negative effect on the organization (Bi et al., 2008). Marketing managers therefore need to make a strategy with disclosure of information that is limited and does not have a sensitive competitive implication (Bhattacharya & Chiesa, 1995; Yosha, 1995). Marketing managers need to make sure that all the other employees embrace the external message of the company and fully understand the meaning of the messages and the transparency goals. Furthermore, the internal transparency is very important as it will result in lower costs

improved working quality, better innovative ideas and loyalty (Tapscott & Ticoll, 2003). It is therefore not only important to look at the external communication regarding transparency, but also the internal part needs attention.

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Firm serving motivations

Furthermore, this desire for transparency is fed by the skepticism of consumers. The attribution theory (Jones & Davis, 1965) is a framework for a situation-based analysis of consumer skepticism. Research has found that consumers draw conclusions about the intentions of marketer motives. These attributions of marketer’s motives have an impact on the evaluations of the firm (Campbell & Kirmani, 2000). As said earlier, consumers will evaluate firms on two types of motives: motives that focus on the potential benefit of the firm itself and the motives that focus on the potential benefit to individuals external to the firm (Forehand & Grier, 2003). The framing of these marketing activities that effect the consumer behavior, needs to take the reputation of the company and the benefit needs of the cause for the environment or situation into account. Whenever consumers attribute the marketing actions of firm-to-firm-serving motivations, it is likely that they will develop negative reactions regarding the firm (Ellen et al. 2000). One explanation of this reaction is that consumers would ideally like to see that a firm only focuses on public-serving motives and that any deviation from such firm ‘altruism’ is seen as negative. Furthermore, consumers that were not informed with the firm-serving motives have actually responded more negatively to the firm when the firm motives were directly communicated (Forehand & Grier, 2003). Therefore, Forehand and Grier (2003) state that any factor that increases consumer skepticism of a firm’s motives is likely to lead to a less positive reaction of the consumer. This consumer skepticism is fed by not taking care of the transparency of the company. It is therefore

important as marketer to be transparent about the motives of the company, whether they are firm-serving motives or public-serving motives.

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Finance

Finance is also important when it comes to transparency. The dominant way by which transparency is communicated by organizations is by the accounting-based model of transparency and is known as numeric transparency (Press & Arnould, 2014). This form of transparency is based upon a monologue communication format, which is exemplified by financial accounting audits (Power, 1997). An accounting audit is an official examination and verification of a company’s accounts and accounting procedures relating to past financial performance (Brownlie, 1996). This kind of transparency, which is mostly used by companies, provides accountability or assurances about the organizational activities and claims explained through accounting audits.

Nevertheless, just giving information about the financial performances of the company does not cover transparency. This might look like a good solution for transferring numeric transparency, but Press and Arnould (2014) indicated three flaws.

Dialogue

As a first flaw, they state that the environment for marketing communications is becoming a discursive arena but these audits are working with one-way marketing communications and do not fit in the environment of the so-called “Web 2.0” (Goldman & Papson, 2006).

Consumers want a dialogue, but this cannot be done because the firms are stuck in a one-way communication paradigm. Similarly, McManus, who is interviewed by Hal Lazarus (Lazarus & McManus, 2006) has researched transparency and he found that transparency is build up from two parts; “Openness, candor, the free flow of information” and “dialogue with the stakeholders” (p. 924). McManus points out that although dialogues are important, they can be difficult. “It is not easy to have a meaningful dialogue with stakeholders who are angry and who think they have been wronged. Likewise, dialogue is not easy if you perceive that the other side is lying and manipulating or hiding facts” (p.925). Habermas’ theory (1983) states

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13 that whenever a person acts in a communicative way and is willing to take part in a process of understanding, he/she implicitly knows that certain universal claims are valid. Those have to be accepted and met by both partners that are in communication. Mutual understanding is the effect of a successful communication and is accomplished when a listener and a speaker agree on terms of their truthfulness (subjective dimension of relative), truth of the assertions

(objective dimension of reality) and on the rightness of the expressed interests (social dimension of reality). To accomplish this successful communication there has to be a symmetric public relation approach, the consensus-orientated public relations.

Prahalad and Ramaswamy (2004) state that this new reality is forcing companies for a reexamination of the traditional system by which companies created value that was company-centric and which has worked the last past 100 years. The asymmetric relationship between the firm and consumer is rapidly disappearing; so companies not only need to focus upon the prices, costs and profit margins. They need to take into account that their attention has to be on more information about the products, technologies they use and business systems need to be more accessible. Whenever a company focuses more on these factors of transparency, they will create new levels of transparency that are increasingly desirable for consumers.

Trust

The second flaw of numeric transparency is mistrust and skepticism of corporate capitalism is increasing worldwide (Iyer & Muncy, 2009), the trust in businesses is declining. As

mentioned before, people can mistrust companies for different reasons. Ring and van de Ven (1994) define trust as “faith in the moral integrity or goodwill of others” (p.93). It is, however, not always the trustworthiness that will be the (first) preference of a company. Consumers can be uncertain whether to rely exclusively upon this trustworthiness. It may be conditioned by legal systems or it can be the role responsibility that a company needs to show (Ring & van de

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14 Ven, 1994). It is therefore important to show stakeholders that the organization is open, to gain trust and keep them connected to the company.

Understandable information

The third flaw is that the provided transparency is difficult for stakeholders to be interpreted (Press & Arnould, 2014). It can be incredibly difficult for consumers to find the relevant information because they got neither time nor understanding of so much information. Whenever an organization buries the consumer with important facts of a case in a pile of meaningless information, it lacks time and ability to find the relevant information. Companies might have said they have covered all information, but it was lacking of understanding

(Balkin, 1999).

Schnackenberg & Tomlison (2014) describe transparency as “the perceived quality of intentionally shared information from a sender” (p.5). They state that transparency is based upon three dimensions: disclosure, accuracy and clarity. Disclosure is about the perceived relevance of information; whether stakeholders think that the information that is provided is relevant enough for them. Accuracy is about whether the given information is perceived as correct. Clarity is once again important regarding transparency as it stands for the information needs to be understandable and complete (Schnackenberg & Tomlison, 2014). Organizations need to make sure that when they want to be transparent, they make it understandable for their stakeholders.

Michener and Bersch (2013) also state that transparency depends on two conditions: inferability and visibility. Inferability is about how useful and understandable the information is and the extent to which people can draw conclusions of that information. The other

dimension is visibility; the extent to which the information can be located by an individual and furthermore about the completeness of the information.

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15 Sirgy & Su (2002) state that “the information provided to consumers about products will help them to make informed choices, reward the business that provides those products, and

discourage those that disregard the informed consumer’ preferences” (p. 1). More information leads however to less understanding (Strathern, 2000) and this can lead to less trust. Ripken (2006) states that “evidence shows that when people are given too much information in a limited time, the information overload can result in confusion, cognitive strain and poorer decision-making” (p. 159-160). Furthermore, disclosure alone cannot be seen as transparent.

Concluding, when companies are trying to be transparent, they need to ensure that the consumers understand their message and will not be buried with information (Wall, 1996). Companies have however, not (fully) changed their communication techniques to overcome this monologue communication format that will provide consumers in a way that they understand the information in a more engaging way (Quinn, 2010).

Public relations

Public relations are important to transfer the positive image of the company. For this, the practitioner in public relations should identify appropriate levels of communication and select which information to offer in order to create consensus (Bukart, 1994). One of the elements of the image is the perceived amount of transparency and it is the goal of the PR practitioner to transfer the image of transparency to the consumers.

Press and Arould (2014) state that these flaws above cannot be solved by numeric transparency and that consumers need a more sustainable marketing communication, a compelling narrative transparency that is understandable and with which consumers can identify themselves. Whenever a company is transparent about their company, consumers can make their purchase and consumption decisions based upon that information. For example, consumers who are concerned about the environment and society will be attracted to companies who communicate that they are that as well (Bhaduri & Ha-Brookshire, 2011).

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16 Olson (1999) has introduced the idea of narrative transparency, which is fundamentally about making narratives accessible to stakeholders. Familiarity and the ability to identify with the communicative content are the key elements of this narrative transparency. It is clear that transparency has to be an interactive way of communicating. Balkin (1999) states that transparency is build up from three types of transparency; informational, stakeholder

participation and accountability. Cotterrell (2000) agrees with Balkin (1999) but also adds that “transparency is a process that involves not only the information, but active participation in acquiring, creating and distributing knowledge.” Vaccaro and Madsen (2009) also argue that transparency is an interactive process and needs cooperation between organizations and their stakeholders to share information. They call this ‘dynamic transparency’; they want to enhance the thinking of a two-directional disclosure, rather than a one-directional disclosure, which is focusing on only the firm to its stakeholders.

Specifying the domain of the construct

To specify the domain of the construct, definitions of ‘organizational transparency’ need to be compared and see if they are contrasting or not (Table 1). For this part, the literature review is being used.

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Table 1: Items of consumer perceived organizational transparency

Fields Authors Dimensions Definitions of Transparency

Legal Banisar (2006) - Informational Transparency is captured within the freedom of information laws. Legal Balkin (1999) - Purposeful information disclosure

- Accountability

Transparency is the deliberate attempt to make available all legally releasable information – whether positive or negative in future – in a manner that is accurate, timely, balanced and unequivocal, for the purpose of enhancing the reasoning ability of publics and holding organizations accountable for their actions, policies and practices. Marketing Chen et al. (2010);

Press & Arnould (2014); Yang & Lim, (2009)

- Purposeful information disclosure Transparency is purposeful information disclosure.

Marketing Merriam-Webster, (2010)

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18 Finance Press & Arnould,

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- Symmetric relationship Transparency is numeric and is based upon a monologue communication format, which is exemplified by financial accounting audits.

Finance Lazarus & McManus (2006)

- Informational

- Symmetric relationship

Transparency is build up from two parts; openness, candor, the free flow of information and dialogue with the stakeholders.

Finance Schnackenberg & Tomlison (2014)

- Purposeful information disclosure Transparency is the perceived quality of intentionally shared information from a sender.

PR Michener and

Bersch (2013)

- Visibility Transparency is all about visibility and inferability.

PR Olson (1999) - Symmetrical relationship (participation)

- Understandable information

Transparency is narrative and will be communicated in an

interactive way so consumers have the ability to identify with the communicative content and will be familiar with it.

PR Balkin (1999) - Accountability - Informational

Transparency is about accountability, information and stakeholder participation.

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19 - Symmetrical relationship (participation) PR Cotterrell (2000) - Informational - Symmetrical relationship (participation)

Transparency is a process that involves not only the information, but active participation in acquiring, creating and distributing knowledge.

PR Vaccaro & Madsen (2009)

- Symmetrical relationship (participation)

Transparency is dynamic and an interactive process that needs cooperation between organizations and their stakeholders to share information; focusing on a two-directional disclosure.

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Taking all the definitions together and highlighting the important items, the following definition is constructed by the summary of the literature review:

“Organizational transparency is a purposeful information disclosure given through a symmetric relationship with the stakeholder which is understandable and is about the

accountability of the organization.”

Method

As seen above, there are several dimensions that influence perceived organizational transparency. This ‘consumer perceived organizational transparency’ is a latent construct (Borsboom et al., 2004). The causality of the items has effect on the construct and will define this construct. Furthermore, the variation in the construct does not cause variation in the item measures; however, variation in item measurements can cause variation in the construct (Rossiter, 2002; Jarvis et al., 2003). Whenever an item is added or being removed, this will change the conceptual domain of the construct ‘consumer perceived organizational

transparency’. All these considerations result in the choice of a formative model rather than a reflective model for developing a construct. A formative construct will therefore be

developed.

For this study, the framework of Churchill (1979) will be used. This framework helps by developing measures of constructs in the marketing field. This framework consists of six steps: Specifying the domain of the construct, generate samples of items, purify the measure, assess reliability with new data, assess construct validity and developing norms. The domain has already been specified in Table 1 but needs to be refined.

Generate sample of items

To refine and improve the items of the instrument a sample of items needs to be generated. There are three strategies to do so: approach experts in the field to get their insights and feedback on the items, approach business professionals in the field to get their insights and

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21 feedback on the items or use a focus group that will help to gain insights about the consumers perceptions about organizational transparency. For this study a focus group will be used.

As a result of the focus group dimensions will be formed. Those dimensions and the outcome of the literature review will be used to form statements that will be placed within the final questionnaire. This questionnaire has been made in Qualtrics, a data collection system. After the analyses of the data from the questionnaire, a construct for ‘consumer perceived organizational transparency’ will be developed.

Focus group

The focus group is conducted to further validate the definition of perceived firm transparency and to ensure that the generated items for the first version of the instrument are in line with the thoughts of experienced adult consumers. The focus group has been held within a living room. The interviewer presented a discussion statement “What do you think that

organizational transparency is” and has encouraged others in the group to respond to what they have just heard. The entire conversation has been recorded for further analyses and lasted for 45 minutes. The most named dimensions were taking into account for the development of the questionnaire.

The focus group contained a group of 9 people and was heterogeneous. This means that the age, nationality and (e.g.) interests have been taken into account and these factors are different for everybody within this focus group. This is important so the results reflect all kind of consumers, there will not be one segment be highlighted. The average age of these

respondents was 36,75 years old. The youngest was 19 years old and the oldest 77 years old. 66,6% of the respondents were men, leaving the other 33,3% women.

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Results focus group

The participants were asked to discuss their view on the transparency of companies and how they perceive that transparency as a consumer. The participants have been being invited by e-mail and social media.

The focus group was being told that every opinion about the given subject would be approved and that they could speak freely. They have been told that everything would be taped. The first question of the discussion was: “What do you think of when I say an organization is transparent (in the broadest way of the definition)?” This started the discussion. The conversation has been interrupted a couple of times to get the group back on track with transparency. At the end, they were asked to give a summary of the discussion and what they thought of perceived organizational transparency, now that they have discussed it.

During the focus group there was an organizational perspective at first, pointing out that not all information needs to be shared.

“Not all the information is given by the organizations, it can be that it will harm them

because of the negative aspects of the news. Furthermore, competitors can copy their businesses, so it won’t be smart to be fully transparent. It is therefore not necessary for me

that a company is completely transparent”.

This shows that consumers reckon with the fact that not all companies are completely honest. Where further on the consumer perspective took the stage:

“Intelligent people need more transparency, because the lower class will take everything for granted more and care less.”

IQ isn’t part of the transparency definition, as it has to be an index for every consumer,

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23 has the goal to fulfill all those needs. It is therefore important that companies are aware of the fact that people with a higher IQ might have higher needs for transparency, but that they also need to be aware of the people with a lower IQ as they might have other needs that can be fulfilled by transparency. The discussion also named; interest, visibility, trust, and honesty.

“When an organization which I’m interested in (for what kind of reason that may be) is

visible for me, with an honest pile of information, I will trust this company and will positively perceive this organization as transparent.”

- “Yes, I also think that transparency is more important to me when I’m interested in

this company and buy my products from them.”

Therefore, whenever a respondent is interested in the company they find it more important that a company is transparent. A consumer wants his needs to be fulfilled. This is stronger for a company, which they like, love and are interested in because they feel that need for that company.

“I think it is important to get enough information from a company where I buy my daily

products, such as groceries. This information needs to be easy to get, for example by a

television advertisement or a billboard poster.”

- “Indeed, whenever a company is not visible, this is not a good sign, are they hiding

something? Is there something that we are not allowed to know? When this happens I don’t trust this company and won’t buy my products from them anymore.”

- “I like to know what happened with the products that I buy. Haven’t they been

produced by children or is there any dangerous pesticide on my food?”

Consumers find it important that whenever they buy products of a company that they are open about the origin of the products. Visibility and purposeful information play a great role for this need.

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“Whenever a company is named in the newspaper with the news that they are making things

up about their products or when the news shows that they have been hiding important information, I won’t easily trust this company again. I think it is very important to trust a

company, they gain this trust with being transparent”

- “I think I can’t trust a company when they are not transparent. You cannot base your

opinion upon something. Furthermore, when I trust a company, I think that they are

more transparent.”

- “Companies need to be honest about the information they give consumers. When I

buy a shampoo and they tell me that the ingredients are fair-trade, but they aren’t, this

is transparency in a wrong way. When a company is truly honest, I will perceive them as more transparent.”

Consumers think that transparency is needed to gain trust. On the other hand, they will find a company more transparent when they trust them. Honesty is however also important for consumers. Whenever a company is honest about, for example, their ingredients, the company will fulfill the need of the consumer regarding their transparency.

Item development

From the focus group, the following items will be taken into account: trust, honesty, visibility and interest. The items which were already found in the literature review were discussed and all of them were been agreed on by the members of the focus group.

Content analysis of the responses, along with the insights of the gathered literature, has led to the specification of several facets of consumer perceived organizational transparency (Table 2).

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Table 2: Facets of consumer perceived organizational transparency by literature review

Facets Source

Purposeful information disclosure

Balkin (1999)

Lazarus & McManus (2006) Rawlins (2008)

Yang & Lim (2009) Chen et al., (2010) Press & Arnould (2014) Symmetric relationship

with the stakeholder

Balkin (1999)

Lazarus & McManus (2006) Vaccaro (2009)

Understandable information

Wall (1996)

Michener & Bersch (2013)

Schnackenberg & Tomilson (2014) Accountability Balkin (1999),

Rawlins (2008)

Trust Focus group

Honesty Focus group

Visibility Focus group

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26 These eight dimensions will be used to form (at first) the pretest and later on the final survey. The final definition of organizational transparency will therefore be:

“Purposeful disclosure of reliable information in such a way that the information is visible and understandable as part of a symmetric trust-based relationship with the stakeholder in

which the organization can be held accountable for the disclosed information.”

Designquestionnaire

Respondents were asked on social media (LinkedIn, Facebook, Twitter) to fill out the questionnaire. Respondents were informed that all their data will be treated anonymous and that if they had questions they could contact the researcher.

First, the respondent needed to answer the demographical questions. The questionnaire contained six fictional news articles about six fictional companies. Each respondent needed to read two articles, one article about a company which part of the food industry and one article about a company, which part of the banking industry. These articles were randomly divided. The food industry and banking industry have been chosen because these industries were named within the focus group as most important industries that needed to be transparent. When using these industries, people will care more about the transparency level than for industries the respondents don’t care about.

After they have read an article, control questions were asked. These control questions were asked to see whether a respondent has truly read the news article. This is important for the validation of the data. The control questions were about the name of the company that was written about and two other questions that concerned the content of the news article.

Further on, respondents were asked to answer 28 statements per article on a five-point Likert-scale (1 = Strongly disagree, 2 = Disagree, 3 = Disagree nor agree, 4 = Agree and 5 = Strongly agree). Those 28 statements were based upon the dimensions that were developed

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27 after the focus group and literature review: trust, honesty, visibility, interest, purposeful information, understandable information and symmetrical relationship with stakeholder. Accountability has not been taken into account, because the people of the focus group stated that consumers would always hold the company accountable for the information they give, no matter if they have to deal with difficult influences. Therefore, there will be seven dimensions that needed to be tested for transparency. Each dimension will be tested with four statements (Appendix A). These statements are developed from scratch and based upon quotes of the focus group. After the statements about the article, the respondents were asked to assign the company to a level of transparency. This has been done by a 7-point Likert-Scale (1 = Very nontransparent, 2 = Nontransparent, 3 = Somewhat nontransparent, 4 = Neither

nontransparent nor transparent, 5 = Somewhat transparent, 6 = Transparent, 7 = Very transparent) (See for Appendix A for the questionnaire).

Item validation

Purify the measure

A pilot test has been done first to see if there are any problems regarding the survey. This pilot test needs to be done among 10 adults within the age of (18-65). This data is been used to purify the instrument. This is stated as ‘the fourth’ step by Churchill (1979). This fourth step contains two analyses that must be used to see whether the survey is internal consistent and to determine the dimensionality of the construct by using component factor analyses. The first test has been done among 12 respondents. They were asked to take the survey. This survey contained of 28 statements (4 per item) and were provided on a five-point Likert scale (strongly disagree to strongly agree). After they took the survey, they were asked to feedback the survey. Based upon the answers and feedback from the respondents, the survey items were revised. The items have been tested upon their interrater-reliability. Whenever the reliability is higher than the reliability criterion of .5, it is perceived as good enough. All items had a

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28 Cronbach’s Alpha > .5 and the overall the Cronbach’s alpha is 0,826. Thereby the fourth criteria of Churchill (1979); the assess reliability of the new data; has been done. This construct has therefore been perceived good enough to use at the final questionnaire.

Respondents

Procedure

The respondents were asked to fill out the questionnaire via e-mail and social media. 362 respondents started the questionnaire; however, only 160 finished the entire questionnaire. Most of the respondents that didn’t finish the questionnaire stopped during the control questions. Probably they didn’t read the articles that well so they could answer the control questions and stopped. Furthermore, although it has been communicated that the

questionnaire would take 15 minutes to fill out, people responded that they thought it would have been less time consuming. This could also be a reason that respondents stopped early.

Manipulation check

It was mandatory to answer the question before you could move on to another question. Therefore, no missing values have been detected. Only the 160 respondents that filled in the questionnaire were taken into account. Furthermore, the control questions are also important. As said earlier, the control questions were asked to see whether the respondent had read the article carefully. Each respondent was asked to provide the name of the company mentioned in the text plus two other content related questions. Respondents needed to correctly answer the name of the company and one of the two other questions, otherwise they were deleted from the database. 17 respondents didn’t answer those control questions correctly. This resulted in a total of 143 respondents that were taken into account for this questionnaire.

Demographics

The age of the respondents was (M=31,3, SD=13,64). The youngest respondent is 18 years old, the oldest respondent 77 years old. 57,3% of the respondents were woman, resulting in a

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29 42,7% of men. Most respondents completed HBO as highest level of education (25,7%), followed by WO Bachelor (21,8%), WO Master (16,5%), VWO (15,2%), MBO (9,2%), HAVO (5,6%), MAVO (3,3%), Other (2,0%) and PHD (0,7%).

Results

Developing dimensions

A principal components analysis (PCA) was run on a 28-question questionnaire that measured customer perceived organizational transparency on 143 respondents. The reason to choose for PCA was because the aim is to reduce a larger set of items into a smaller set of items (called principal components) that account for most of the variance in the original items. The goal is develop a construct with these components. Therefore, it is important to see whether the items load at the same underlying construct: consumer perceived organizational transparency. The PCA will reduce many correlated items into a single artificial variable: a principal component. This component can be used to create the scale for consumer’ perceived organizational

transparency.

A Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy has been run. The KMO measure is an index that shows whether there are linear relationships between items. This measure shows whether it is appropriate to run a PCA. The requirement for sampling adequacy is a minimum KMO score of 0.6. The overall Kaiser-Meyer-Olkin (KMO) measure was 0.92 with individual KMO measures all greater than 0.6 (Table 3). Kaiser (1974) this KMO (≥.9) can be classified as ‘marvelous’. PCA would therefore be an appropriate analysis to run. Bartlett’s Test of Sphericity was also run to see whether the PCA is an analysis that can be used. Whenever the Bartlett’s Test of Sphericity is significant there are correlations between any of the items. This would mean that the data is suitable for a PCA. This test was statistically significant (p <. 0005), so the data can be indicated as likely factorable.

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Table 3: Kaiser-Meyer-Olkin Measure per item

Variable KMO Measure

Q20 .814 Q24 .949 Q7 .947 Q10 .950 Q4 .939 Q5 .933 Q8 .951 Q6 .950 Q23 .936 Q22 .933 Q14 .662 Q17 .931

Variable KMO Measure

Q3 .941 Q18 .858 Q25 .890 Q15 .897 Q26 .933 Q13 .902 Q1 .930 Q16 .945 Q27 .907 Q19 .872 Q28 .958 Q12 .855 Q9 .772

The PCA has been run. The correlation matrix (Appendix B) showed that 3 of the 28 items had a correlation coefficient less than 0.3. The level of correlation considered worthy of an item’s inclusion is usually (r ≥.0.3). Thus all the items that not have at least one correlation with another item where (r ≥.0.3) have been deleted (“Only communicates information that I need” (r = .29 , “Gives me information I don’t understand”(r = .21, “Are making things up about their company”(r = .23)). These items are likely measuring something different to all the other items.

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31 The second step is to see which components need to be retained. This will be done by an eigenvalue-one criterion, a scree plot and the interpretability criterion. The eigenvalue-one criterion has been run. The eigenvalue-one criterion revealed that four components had eigenvalues greater than one (Table 4). This means that the component explains more

variance than one item would and hence they should be retained. These components explained 38,4%, 10,0%, 5,9% and 4,7% of the total variance. The four-component solution explained 59,0% of the total variance (Table 4).

Table 4: Total variance explained

Initial Eigen values

Component Total % of variance Cumulative %

1 9.603 38,41 38,41

2 2.509 10,04 48,45

3 1.478 5,91 54,36

4 1.168 4,67 59,03

The scree plot has also been checked. A scree plot contains a plot of the total variance explained by each component. The components to retain are those before the inflection point on the graph (Cattell, 1966). The visual inspection of the scree plot (Table 5) below would lead to the retention of the first three components. This is different from the Eigenvalue-one criterion.

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Table 5. Scree plot of all the items measuring consumer perceived organizational

transparency

An Oblimin rotation with Kaiser Normalization was used to aid interpretability because oblique rotations make it possible to get a particularly straightforward interpretation of the factors. The items will form clusters that represent the components (Table 6). The rotated component matrix has been checked. This matrix shows how the retained, rotated components load on each item. Following the interpretability criterion, a simple structure can be formed when each components loads strongly on at least three items and when each item has only one component that loads strongly on it.

However, some items loaded on two components. Q5 loaded on component 1 (.596) and component 4 (.417), Q26 loaded on component 1 (.389) and component 2 (.476) and Q13 loaded on component 1 (.393) and component 3 (.728). The items were excluded from the component where they loaded least. The dissimilarity between the two loadings were big enough to do so. The component loadings and communalities of the rotated solution are present in Table 6. 0 2 4 6 8 10 12 0 5 10 15 20 25 30 Eig env al ue Items

Screeplot

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Table 6. Rotated structure matrix for PCA with Oblimin rotation with Kaiser

Normalization for a four component questionnaire

Items Rotated factor pattern

Component 1 Component 2 Component 3 Component 4 Communalities

Q20 .861 .482 Q24 .820 .715 Q7 .740 .660 Q10 .691 .552 Q4 .670 .434 Q5 .596 .417 .651 Q8 .510 .315 Q6 .492 .552 Q23 .490 .687 Q22 .441 .421 Q14 .857 .627 Q17 .855 .813 Q3 .834 .702 Q18 .782 .318 Q25 .762 .704 Q15 .700 .768 Q26 .389 .476 .619 Q13 .393 .728 .698 Q1 -.571 .481 Q16 .472 .491 Q27 .761 .702

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34

Q19 .547 .625

Q28 .511 .569

Q12 .491 .659

Q9 .465 .510

Note: The items loading that are striped aren’t taking into account under that component due to a higher loading on another component.

However, the scree plot showed that there have to be three dimensions for this construct, the Eigen-Value Criterion and the Interpretability Criterion showed that there were four

dimensions that need to be retained. Therefore, four dimensions will be retained for this construct.

The interpretation of the data was not consistent with the dimensions the questionnaire

primarily designed for. There were strong loadings on component 1: symmetrical relationship, purposeful information disclosure, understandable information, component 2: likability and trust items, component 3: understandability, purposeful information disclosure and visibility items and component 4: honest, visibility and trustworthy items. From these four components, four dimensions are formed. Component 1 will be dimension “Symmetric relationship of purposeful and visible information” (Table 7), component 2 will be dimension “Emotional trust-based relationship” (Table 8), component 3 will be dimension “Consumer information needs” (Table 9) and component 4 will be dimension “Trustworthiness of information” (Table 10).

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Table 7. Items of dimension 1.

Dimension 1 – “Symmetric relationship of purposeful and visible information” Q20: Answers questions or comments of consumers

Q24: Will provide me with accurate information when I want it Q7: Communicates with customer about subjects

Q10: Listens to the customer for feedback

Q4: Is open for critics or comments of consumers Q5: Will always tell me the truth when asked to

Q8: Makes sure I receive their messages about themselves Q6: Provides me with information that I want

Q23: Is unclear regarding information about themselves Q22: Will hide information about themselves

Dimension 2 – “Emotional trust-based relationship” Q14: Is a company that provides me with a good feeling Q17: Is a company I care about after reading the article Q3: Is a company I like

Q18: Is a company I trust

Q25: Is a company I’m interested in Q15: Is trustworthy

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Dimension 3 – “Consumer information needs” Q16: Provides me with simple information Q1: Shows me information without asking for it

Q13: Only communicates information that I want to have

Dimension 4 – “Trustworthiness of information” Q27: Doesn’t lie about information they give Q19: Tells the truth about the company Q28: Would not spread around my secrets

Q12: Might come forward with negative information if needed Q9: Is honest about positive and negative information

Dimensions & different levels of transparency

An One-Way Anova was conducted to determine if the dimensions as stated above were different for companies with different levels of transparency that were presented in the articles of the questionnaire. Companies have been classified into six groups. For the food industry there were the following companies: NutriQuality (N=52), Guapa Banana (N=47), and Grandma’s meatballs (N=47) and for the banking industry: AHN Bank (N=53), Point Bank (N=56) and Orange Bank (N=39). Data is presented as mean ± standard deviation. The companies that were present in the article will be compared on the four dimensions.

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37 Dimension 1:

There was homogeneity of variances for the dimension “Symmetric relationship of purposeful and visible information”, as assessed by Levene’s test for equality of variances (p =.232). This means a post hoc contrast test can be done to see which companies correlated with each other.

Food industry

Dimension 1 “Symmetric relationship of purposeful and visible information” for the food industry, increased from Grandma’s Meatballs (N=55, M=2.26, SD=0,49) to Guapa Banana (N=47, M=3,20, SD=0,46) to NutriQuality (N=52, M=3,69, SD=0,47) (Table 11).

Table 11: One-Way Anova descriptives dimension 1: Symmetric relationship of

purposeful and visible information for the food industry.

Descriptives

Company N M SD

NutriQuality 52 3.69 .47

Guapa Banana 47 3.20 .46

Grandma’s Meatballs 55 2.26 .49

A Turkey Post Hoc test have been done to see which companies differ significantly from each other. The Turkey Post hoc test revealed that the mean increase from Guapa Banana to the NutriQuality (0,48, 95% CI [-77,-.19]) was statistically significant (p < .001), as well as the increase from Guapa Banana to Grandma’s (0,94, 95% CI [.65,1,2]) (p < .001). The mean increase from Grandma’s Meatballs to NutriQuality (1,42, 95% CI [1.14, 1.70]) (p <.001) was also statistically significant. Concluding that the companies of the food industry all differ significantly from each other on dimension 1 (Appendix C).

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Banking industry

Dimension 1 “Symmetric relationship of purposeful and visible information” for the bank industry, increased from Orange Bank (N=40, M=2.29, SD=0,59) to Point Bank (N=56,

M=3.01, SD=0,51) to AHN Bank (N=53, M=3,59, SD=0,39) (Table 12).

Table 12: One-Way Anova descriptives dimension 1: Symmetric relationship of

purposeful and visible information for the banking industry.

Descriptives

Company N M SD

AHN Bank 53 3.59 .39

Point Bank 56 3.01 .51

Orange Bank 40 2.29 .59

Also for the banking industry a Turkey Post Hoc test had been run. The Turkey Post hoc test revealed that the mean increase from Point Bank to AHN (0,58, 95% CI [.85,29]) was statistically significant (p < .001), as well as the increase from Orange bank to Point Bank (0,72, 95% CI [1.0,.42]) (p < .001) and the mean increase from Orange Bank to AHN Bank (1.30, 95% CI [1.6,.98]) (p <.001) were statistically significant. Also for this industry the companies differ statistically from each other on dimension 1 (Appendix C).

Furthermore, the dimension “Symmetric relationship of purposeful and visible information” was statistically significantly different for different levels of consumer perceived

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39 Dimension 2:

There was homogeneity of variances for the dimension “Emotional trust-based relationship”, as assessed by Levene’s test for equality of variances (p =.130).

Food industry

Dimension 2 “Emotional trust-based relationship” for the food industry, increased from Guapa Banana (N=47, M=2,69, SD=0,58) to Grandma’s Meatballs (N=55, M=3,04,

SD=0,10) to NutriQuality (N=52, M=3,64, SD=0,59) (Table 13). The mean score of the least

transparent company (Grandma’s Meatballs) is therefore higher than the middle transparent company (Guapa Banana).

Table 13: One-Way Anova descriptives dimension 2: ‘Emotional trust-based

relationship’ for the food industry.

Descriptives

Company N M SD

NutriQuality 52 3.64 .59

Guapa Banana 47 2,69 .58

Grandma’s Meatballs 55 3,04 .10

The Turkey Post hoc test revealed that the mean increase from Guapa Banana to NutriQuality (0,95, 95% CI [-1.34,-.55]) was statistically significant (p < .001). The increase from Guapa Banana to Grandma’s Meatballs (0,35, 95% CI [-.74,.03]) (p = .110) and is therefore not statistically significant. Grandma’s Meatballs to NutriQuality (0.60, 95% CI [-.97,-.21]) (p <.001) was statistically significant. Meaning that only Guapa Banana and Grandma’s Meatballs don’t differ statistically from each other within the food industry for dimension 2 (Appendix C).

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40

Banking industry

Dimension 2 “Emotional trust-based relationship” for the bank industry, increased from Point Bank (N=56, M=2,33, SD=0,69) to Orange Bank (N=40, M=2,38, SD=0,68) to AHN Bank (N=53, M=3,48, SD=0,64) (Table 14). The least transparent company (Orange Bank) has again a higher mean score on these dimensions than the middle transparent company (Point Bank).

Table 14: One-Way Anova descriptives dimension 2: ‘Emotional trust-based

relationship’ for the banking industry.

Descriptives

Company N M SD

AHN Bank 53 3.48 .64

The Turkey Post hoc test revealed that the mean increase from Point Bank to AHN (1,15, 95% CI [-1.51,-.76]) was statistically significant (p < .001). The increase from Orange Bank to Point Bank (-.5, 95% CI [-.36,.45]) is not statistically significant (p = 1,000). However, the Orange Bank and AHN Bank differ and are statistically significant (1,10, 95% CI [-1.5,-.68]) (p < .001). The Orange Bank and Point Bank don’t differ statistically from each other on dimension 2, however AHN & Orange Bank and AHN & Point Bank do differ statistically on dimension 2 (Appendix C).

Furthermore, the dimension “Emotional trust-based relationship” was statistically significantly different for different levels of consumer perceived transparency, F(5,296) =35,040, p < .0001.

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41 Dimension 3:

The assumption of homogeneity of variances was violated for the dimension “Consumer information needs”, as assessed by Levene’s test for equality of variances (p =.002). This means that a Games-Howell post hoc test has to be done to check for correlations.

Food industry

Dimension 3 “Consumer information needs” for the food industry, increased from Grandma’s Meatballs (N=55, M=2,70, SD=0,52) to Guapa Banana (N=47, M=2,85, SD=0,50) to

NutriQuality (N=52, M=3,14, SD=0,46) (Table 15).

Table 15: One-Way Anova descriptives dimension 3: ‘Consumer information needs for

the food industry.

Descriptives

Company N M SD

NutriQuality 52 3,14 .46

Furthermore, the Games-Howell-Post hoc test revealed that the mean increase from Guapa Banana to NutriQuality (0,29, 95% CI [-.57,0.007]) (p = 0,041) is statistically significant. The increase from Guapa Banana to Grandma’s Meatballs (0,14, 95% CI [-.16,.44]) (p = .732) was not statistically significant and thus isn’t statistically different for dimension 3.

Grandma’s Meatballs to NutriQuality (0.43, 95% CI[-.72,-.43]) (p <.001) is statistically significant and does differ statistically from each other on dimension 3 (Appendix D).

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Banking industry

Dimension 3 “Consumer information needs” for the bank industry, increased from Orange Bank (N=40, M=2,68, SD=0,69) to Point Bank (N=56, M=2,82, SD=0,50) to AHN Bank (N=53, M=3,27, SD=0,39) (Table 16).

Table 16: One-Way Anova descriptives dimension 3: ‘Consumer information needs’ for

the banking industry.

Descriptives

Company N M SD

AHN Bank 53 3.27 .39

The mean increase from Point Bank to AHN (0,45, 95% CI[-.70,-.19]) was statistically significant (p < .001). The increase from Orange Bank to Point Bank (0.14, 95% CI[-.46,.17]) is not statistically significant (p = .878). However, the Orange Bank and AHN Bank did differ and are statistically significant (0,59, 95% CI[-.95,-.22]) (p < .001) (Appendix D).

The dimension “Consumer information needs” was statistically significantly different for different levels of consumer perceived transparency, Welch’s F(5, 133.208) = 12.882, p < .001.

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43 Dimension 4:

The assumption of homogeneity of variances was violated for the dimension “Trustworthiness of information”, as assessed by Levene’s test for equality of variances (p =.006). Therefore, also for this dimension the Games-Howell Post hoc test will be used.

Food industry

Dimension 4 “Trustworthiness of information” for the food industry, increased from Guapa Banana (N=47, M=3,05, SD=0,51) to Grandma’s Meatballs (N=55, M=3,11, SD=0,48) to NutriQuality (N=52, M=3,37, SD=0,52) (Table 17).

Table 17: One-Way Anova descriptives dimensions 4: ‘Trustworthiness of information’

for the food industry.

Descriptives

Company N M SD

NutriQuality 52 3,37 .52

The Games-Howell-Post hoc test revealed that the mean increase from Guapa Banana to NutriQuality (0,32, 95% CI [-.60, .002]) (p = 0,046), Guapa Banana to Grandma’s Meatballs (-0,14, 95% CI [-.33,.23]) (p = .996) and Grandma’s Meatballs to NutriQuality (0.26, 95% CI[-.53,0.02]) (p = 0.097) were all not statistically significant (Appendix D).

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Banking industry

Dimension 4 “Trustworthiness of information” for the bank industry, increased from Orange Bank (N=40, M=2,80, SD=0,68) to Point Bank (N=56, M=2,96, SD=0,68) to AHN Bank (N=53, M=3,19, SD=0,42) (Table 18).

Table 18: One-Way Anova descriptives dimensions 4: ‘Trustworthiness of information’

for the banking industry.

Descriptives

Company N M SD

AHN Bank 53 3.19 .42

The Games-Howell Post hoc test showed that the mean increased from Point Bank to AHN (0,23, 95% CI[-.44,.23]) was not statistically significant (p = 0,275). The increase from Orange Bank to Point Bank (0.16, 95% CI[-.57,0,25]) is not statistically significant (p =.867). However, the Orange Bank and AHN Bank differ and are statistically significant (0,39, 95% CI[-.75,-.02]) (p < .05) (Appendix D).

The dimension “Trustworthiness of information” was statistically significantly different for different levels of consumer perceived organizational transparency, Welch’s F(5, 133.208) = 5,026, p < .001.

The contrast tests showed that not all companies are statistically significant. However, all four dimensions are significantly different for different levels of consumer perceived

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45 organizational transparency. This shows that whenever a company is very transparent the outcome of the construct will be different from for a company that is not transparent at all. Dimensions & overall perceived transparency per company

Now the data from all the dimensions and statements has been analyzed, the final question about the overall perceived transparency needs to be taken into account. The last question that was asked at the respondents was to answer how transparent a company was to them on a 7-Point Likert-Scale (1 = Very nontransparent, 2 = Nontransparent, 3 = Somewhat

nontransparent, 4 = Neither nontransparent nor transparent, 5 = Somewhat transparent, 6 = Transparent, 7 = Very transparent).

A Pearson’s product-moment correlation was run to assess the relationship between the dimensions of consumer perceived transparency and with the last question the respondent needed to answer, as mentioned above. This has been done to see whether the dimensions are correlating differently on different levels of transparency and industry. Guidelines made by Cohen (1988) will help to see whether the correlation is small, (0,1 < | r | <.3), moderate (0.3 < | r | <.5) or strong | r | >.5). The most transparent companies (NutriQuality (M=5,50) & AHN Bank (M=5,40)) were also perceived as most transparent by the respondents. NutriQuality and AHN Bank scored ‘somewhat transparent – transparent’. They were followed by the middle transparent companies (Guapa Banana (M=4,23) & Point Bank (3,53)) which were perceived as ‘somewhat nontransparent – neither nontransparent nor transparent’. And the last (not transparent) companies were rated as the least transparent (Grandma’s Meatballs (3,29) & Orange Bank (2,85)) and perceived as ‘non-transparent – somewhat non transparent’ (Table 19). This is means that the used articles are reliable and reflect the level of transparency that they needed to do.

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Table 19: Descriptives of respondents perceived transparency of the companies in the

news articles. Company N M SD NutriQuality 52 5,50 .852 Guapa Banana 47 4,23 1.220 Grandma’s Meatballs 55 3,29 1.315 AHN Bank 52 5,40 .913 Point Bank 57 3,53 1.571 Orange Bank 40 2,85 1.331

Correlations food industry

To begin with the companies of the food industry, there was a strong correlation between ‘NutriQuality and ‘Symmetric relationship of purposeful and visible information’, (r(50) = .627, p < .0005), a moderate correlation with ‘Emotional trust-based relationship’ (r(50) = .365, p < .0005) and ‘Trustworthiness of information’ (r(50) = .494, p < .0005), but a low not significant correlation with ‘Consumer information needs (r(50) = .248, p > .0005).

Also ‘Guapa Banana’ (r(45) = .689, p < .0005) had a strong correlation with ‘Symmetric relationship of purposeful and visible information’, ‘Emotional trust-based relationship’ (r(45) = .677, p < .0005) and ‘Trustworthiness of information’ (r(45) = .694, p < .0005), but a moderate correlation with ‘Consumer information needs’ (r(45) = .403, p < .0005).

Grandma’s Meatballs had also strong correlation with ‘Symmetric relationship of purposeful and visible information’ (r(53) = .556, p < .0005) and ‘Trustworthiness of information’ (r(53) = .590, p < .0005). Furthermore Grandma’s Meatballs had a moderate correlation with ‘Emotional trust-based relationship’ (r(53) = .487, p < .0005) and a low not significant correlation with ‘Consumer information needs’ (r(53) = .106, p < .0005).

A construct development of consumer perceived organizational transparency within relationship marketing

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