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During the recent hockey-disappointment-induced riots in Vancouver, Canada, and in the days that followed, the transparency and rapid news dissemination capabilities of social media were made abundantly apparent.

As the riot itself unfolded on live television, the riot’s instigators and youth caught up in the fray made countless posts to Twitter, Facebook and elsewhere, recording and documenting their activities. Some of the images they posted were bizarrely compelling; others were undoubtedly evidence of criminal activity. (The ‘social media vigilantism’ of the following week has also been an interesting topic of vibrant discussion.) News of the riot quickly spread around the world, making cover stories in Australia, India and elsewhere. Vancouverites collectively hung their heads in shame that their fair city—which had received accolades for its positive celebrations during the 2010 Olympic Winter Games just 12 months before—should again showcase an ugly side.

Yet at the same time as the riot was unfolding, so too was the Clean Up Vancouver campaign. Launched on the night of the riots on Facebook, this simple campaign invited positive Vancouverites to come downtown the following morning to help clean up after their not-so-positive fellow citizens. By 7:00am, hundreds of people were downtown with brooms and dustpans; by noon, some reports suggested more than 10,000 had joined the Clean Up. Plywood boarding over the broken windows of one major retailer became the ‘Love Wall,’ on which people wrote messages of apology and respect.

This Jekyll and Hyde capacity of social media is both powerful and puzzling. It’s powerful in its capacity to rally thousands of people to positive action. Yet, it’s puzzling, because it as easily can be used to drive disruption. However and organization might choose to use social media and its unparalleled reach, posts and other content are there forever, for anyone to see. And it is precisely this unprecedented transparency that gives organizations pause. Should we open up?

In a recent keynote at the Institute of Fundraising‘s National Convention in London, UK, I spoke about one organization that seized the potential advantage of transparency—somewhat to its own surprise.

Charity: Water is a US NGO that provides clean drinking water to rural areas in some of the world’s poorest countries. They dig wells in countries of sub-Saharan Africa and southeast Asia. Each year, they run a ‘September Campaign’ to celebrate the anniversary of their founding (September 7). A key feature of the campaign is the live, online broadcast of Charity: Water’s latest well drilling project. For their first three years, this had been a tremendous morale- and awareness-building opportunity.

September 7, 2010, also happened to be Charity: Water founder Scott Morrison’s 35th birthday. So he was excited to be drilling a new well—to be broadcast live, online—in Moale, Central African Republic. Geologists had identified a perfect spot, where water was anticipated to be accessible between 500 and 700′ below the surface. A special drill was brought in that was capable of drilling to 800′, cameras were set up, and drilling began. It takes hours and hours to drill that far into the ground, but by 9:00pm, the drill had penetrated some 300′ into the ground. That’s when disaster struck.

The bore hole collapsed on itself. During the live broadcast. Supporters and donors around the world saw Charity: Water fail at their core service. The funds they’d donated went completely to waste. And there was no hiding from the damage.

The Charity: Water team began again, and worked through the night to make a second attempt. It also failed. And the following morning, Morrison stood in front of the camera—still broadcasting live—and shared his disappointment openly and honestly with his viewers. He expected to be rebuked, to lose key funders, and to suffer criticism from supporters. The opposite turned out to be true.

“We appreciate your transparency,” said one Twitter contact. “I think this is perhaps even more important than sharing your successes,” said a Facebook post. “Even with the best planning, scientific data and equipment, you can have a myriad of problems… thank you for sharing your challenges,” said a field engineer that supports Charity: Water’s work.

Rather than punishment, Charity: Water was congratulated for their hard work, and for honestly sharing that 5% of their well-drilling attempts do fail. They aren’t infallible.

Their website received more traffic that day than in the history of Charity: Water. Their support solidified even further. And their donations took a positive, upward turn.

This sort of transparency is daunting to many. The ‘old school’ public relations approach would be to bury a story like this: Failures were not to be shared; they were to be shunned! But that was never realistic. And today, ‘keeping a lid’ on such a story is impossible: Just one Tweet from one field operator at Charity: Water would make the story public. Rather than hiding from this transparency, Morrison and Charity: Water seized it as an opportunity to forge valuable connections with important stakeholders around the world. What may have appeared to be risky was really just an exercise in openness and honesty.

Every organization—in business, in the social sector, and otherwise—must acknowledge that this transparency is the new reality. Hiding from it is an ostrich-like, self-defeating exercise. Opening to it, and seizing its advantages is one way to build relationships of trust and goodwill.

Ultimately, transparency is about respect. As Scott Morrison said, “Perhaps people wanted us to fail…. I don’t think so. I think people just want to know the truth.”