Updated: Feb 3, 2019
In its nineteenth year the Edelman Trust Barometer has firmly cemented itself as valuable browsing for business leaders. In times of low trust this year’s report proves more essential than normal. Why? Because in such uncertain times businesses, and their leaders, are being reported as the most trusted institutions across the globe.
For several years now, the survey has tracked a reduction in trust across institutions – particularly government and media. While there was a dent post GFC, business have been able weather the storm of the last three or so years better than others.
The reasons why are more complex and probably the result of a perfect storm of macro trends and local events. From my experience and observations two leading contributing factors are; the transparency and predictability around the motivations and goals of business (as opposed to government or media); and the perception that, at least in some part, the interests of people as a consumer and/or employee align with the interests of business.
There is also the increasing trend for businesses to step up as responsible citizens either through expanded corporate sustainability programmes, supporting civic campaign such as marriage equality or aligning business strategy to be proactive around environmental and social issues. Just this week Australian mining giants Rio Tinto and BHP publicly declared their backing and funding for the campaign for Indigenous rights as presented through the Uluru Statement following its dismissal from the Federal Government.
While the whys and wherefores are another blog post on their own, lets lift the lid on more of the findings from the Edelman report.
Local is important
Faith is more likely to be placed in the businesses closest to people, 75 per cent of respondents said they trust their employer compared to 56 per cent of businesses in general. This finding is also consistent with some engagement I was involved in, immediately following the Brexit vote in the UK where people told a story of trusting their local businesses more than larger corporates/multi nationals and a number of studies that report people trusting their local small businesses over large multinationals.
This trust is not given unconditionally. The survey reported that 76 per cent of respondents said that CEOs should take the lead on change rather than waiting for governments to impose it. Equal pay, tackling prejudice and discrimination, training for the jobs of tomorrow and the environment all rank highly in the list of issues people are wanting action on. People are also expecting CEOs to step to be leaders in the community, not just their business, with 71 per cent of respondents saying it is critically important for their CEO to respond to challenging times in times of industrial tension, political turbulence and national crisis.
Business is seen as the new source of truth
In times of fake news, social media and dwindling trust in traditional media, employees are looking to their business as a trustworthy source of information about social issues and other important topics where there is not general agreement.
The most credible voices trusted by people were company technical experts (65%), regular employees (53%) and then the CEO (47%) and Board of Directors (44%) which is still an improvement on journalists (36%) and government officials (35%). Compellingly this trend spans across all sections of the workforce – including those who are traditionally disenfranchised in other public forums. Those policy positions, social media posts, internal memos and CEO updates should be thought through carefully – your employees are listening closely and trust what you are saying.
Building trust is good for business
The benefit for business in meeting employee expectations and building trust is strong. The Edelman analysis found that employees that trust their employer are 30 to 40 percent more likely to advocate for the business and demonstrate loyalty, engagement and commitment to the organisation. Trust also was shown to be a litmus test used by other stakeholders with 78 per cent of respondents saying that how a company treats its employees is one of the best indicators for its overall level of trustworthiness and 67% said unless they trust a company, they will stop buying a product.
Things businesses can do to build and maintain trust
So what can be done to build trust in your business? Here's a short list from the Many Small Things team:
Get an understanding of stakeholder’s expectations – ‘doing the right thing’ means different things to different people. The sooner you can articulate what it means for your stakeholders and business the better chance you have of meeting those expectations and have a conversation around it.
Take your responsibility seriously – just because people think you are credible and trust what you are saying today, doesn’t mean that they will tomorrow. Take the responsibility seriously and use the influence for good.
Be consistent – trust is built on consistent, predictable behaviour – in this case to act in people’s best interest. When people and organisations start behaving erratically those trust levels will start to drop.
Look for a larger leadership role – rarely is business leadership seen through the prism of civic leadership. The new year presents a convenient time to apply the same research, analytical and decision-making processes you would in an organisational context and apply them to the community. Business leaders are increasingly being seen as our civic leaders which means they need a vision, plan and engagement approach to positively inform their role in the community.
Be authentic – people want transparency and authenticity about the issues you care about and take action on. People are more likely to think you are credible and authentic if you are clear about why it is in your interests to show leadership beyond trying to court public sentiment or jump on a broader bandwagon.
To learn to more contact Laura Harkins-Small, Principal Many Small Things - email@example.com