Introduction: Strategic transparency has become a central component of organizational governance, particularly in sectors where stakeholder trust and institutional accountability are essential for long-term stability. In Iran’s banking system, transparency is not merely a reporting requirement but a strategic practice that shapes organizational identity, public perception, and regulatory compliance. Its significance increases in regions with fragile institutional environments and historically low levels of public trust. Ilam Province is one such region, where banks—especially private and semi-private institutions—operate under cultural expectations, limited institutional infrastructure, and social complexities. Despite increasing academic focus on transparency, most studies address national-level regulations rather than examining how transparency is constructed and practiced within such challenging regional contexts. This study fills this gap by exploring the dimensions, mechanisms, and contextual conditions that shape strategic transparency in the banking institutions of Ilam Province, aiming to develop a localized conceptual model that reflects the province’s institutional realities.
Methodology: This study used a qualitative design based on the grounded theory approach of Strauss and Corbin (1998). Grounded theory is appropriate for examining complex social processes in contexts where theoretical development is limited. Data were collected through 25 semi-structured interviews with managers, supervisors, and expert staff of private and semi-private banks in Ilam Province. Participants were selected based on their experience with decision-making, information disclosure, stakeholder interaction, and governance processes. Interviews focused on perceptions of transparency, organizational strategies, challenges, and environmental influences. The data were analyzed through open, axial, and selective coding. Open coding identified initial concepts; axial coding grouped these concepts into categories by identifying relationships; and selective coding integrated the categories into a coherent theoretical framework around the core concept of strategic transparency. Constant comparison, memo-writing, and iterative refinement ensured conceptual accuracy, and credibility was reinforced through member checking and peer review.
Results and Discussion: Findings indicate that strategic transparency in Ilam’s banking sector can be explained through three interrelated dimensions: informational, procedural, and relational transparency. Informational transparency refers to the clarity and relevance of data disclosed to stakeholders; participants emphasized that strategic value emerges when information is selectively organized and communicated to reduce ambiguity and build confidence. Procedural transparency concerns openness in internal processes and decision-making pathways. In low-trust contexts, this dimension reduces perceptions of bias or inconsistency and strengthens perceptions of fairness. Relational transparency focuses on authenticity, consistency, and honesty in interactions with stakeholders. In a region where interpersonal trust strongly shapes institutional trust, relational behaviors—such as respectful communication and reliability—form the foundation for how stakeholders judge the credibility of banks. A major theoretical contribution of this study is the concept of “gradual transparency.” Banks in Ilam adopt a staged, incremental approach to transparency rather than abruptly moving toward full disclosure. This adaptive strategy allows banks to expand the depth of their disclosures in alignment with organizational readiness, institutional maturity, and evolving stakeholder expectations. Gradual transparency enables banks to build trust progressively, strengthen internal systems, and minimize risks associated with premature or excessive disclosure. The final model shows that gradual transparency positively influences three critical outcomes: stakeholder trust, strategic coherence, and social legitimacy. By framing transparency as a dynamic, evolving process shaped by institutional and cultural conditions, the study expands current theoretical understandings.
Conclusion: This research provides a context-sensitive, empirically grounded model of strategic transparency tailored to the unique institutional environment of Ilam Province. The identification of three key dimensions—informational, procedural, and relational transparency—along with the introduction of the concept of gradual transparency, contributes both theoretically and practically to the transparency literature. The findings offer a useful framework for banking policymakers, regulators, and managers seeking to implement realistic and culturally aligned transparency practices in low-trust settings. Future research could apply this model to other regions or sectors to compare how institutional environments shape the nature and evolution of transparency practices.