Transparency has several meanings.

In optics, transparency is the material property of allowing light to pass through.

When used in a social context, transparency implies openness, communication, and accountability.

In the 401(k) industry, transparency means fee disclosure. And, of course, it’s what Congress and the Department of Labor have been focusing on over the last few years.

But it may be the private sector that puts transparency into a very practical setting. BrightScope, Inc., an independent data analytics firm today announced the launch of their 401k ratings disclosure website featuring the BrightScope Rating™, the nation’s first online 401(k) rating system.

The new BrightScope Rating™ debuted today (see Press Release) at the 2009 Los Angeles Benefits Conference, co-sponsored by the Internal Revenue Service (IRS), the American Society of Pension Professionals & Actuaries (ASPPA) and the National Institute of Pension Administrators (NIPA).

What’s a BrightScope Rating™? It’s a quantitative 401(k) plan rating developed by BrightScope, Inc. in partnership with some of the country’s top independent fiduciaries, finance professors, and 401(k) experts. BrightScope Ratings™ take into account over 200 unique data inputs per plan and calculate a single numerical score to define 401k plan quality at the company level.

For example, BrightScope currently rates the 401(k) Plan for the Southwest Airlines Pilots as among the top plans within its respective peer group, as measured in terms of plan size, number of participants and employee demographics.

Participants contributing to this plan, BrightScope says, have a high likelihood of having a secure retirement.

The picture below is a snapshot of what you would see on the BrightScope website for the Southwest Airlines plan.

The complete rating can be viewed by clicking here.

You can see detailed scores and attributes for the other approximate 1000 of the largest 401(k) plans that BrightScope has reviewed to date by visiting their website, with more plan ratings available later this year.

As for me, I’m still thinking about the implications of this innovation. Could be huge.