by Joe Chappell
Oct 30 2011
- Peggy Noonan, The Wall Street Journal
As we head into November and approach the end of the year, to say 2011 has been a volatile year for the global trust scale would be an understatement. From the Arab Spring and the Eurozone crisis to tumultuous partisan politics in the U.S. driving the economy to the brink of disaster, and the Occupy Wall Street movement gaining momentum worldwide, this is a year that has tested the limits of the concept of trust itself.
According to the 2011 Edelman Trust Barometer, published in January of this year, globally, trust was up slightly in all institutions over 2010. This included NGOs, business, government, and media. Emerging markets showed the greatest incline, with Brazil leading in trust (81% vs. 62% in 2010), followed closely by India (70% vs. 67% in 2010), and Italy (64% vs. 59% in 2010). China dropped one percentage point from 62% in 2010 to 61% in 2011.
The United States showed the sharpest decrease in trust from 2010 to 2011, dropping from 54% to 46% percent. These statistics have been echoed culturally in the U.S. throughout the year, from the debt ceiling debate followed by S&P's downgrading of U.S. debt to the Occupy Wall Street movement. Furthermore, in the United States the 2011 decline mirrors the 2008-2009 drop, making the U.S. the only country to have seen an across-the-board fall.
Industries topping out the most trusted in the 2011 study revealed the tech industry at the top (81%), followed by automotive (69%) and telecommunications (68%). At the bottom of the trust barometer, were the insurance (52%), banking (51%), and financial services (50%) industries. Since the financial crisis, banks have been unable to regain trust in the United States, again mirrored in the Occupy Wall Street movement, which has expanded globally, and the recent Bank of America consumer backlash surrounding proposed debit card fees. On the other hand, trust levels in the tech industry have remained high worldwide, glimpses of which could be seen culturally with the sentiment surrounding Steve Jobs death in early October of this year.
The four main concluding points of the 2011 Edelman Trust report were:
- Business must align with profit and purpose for social benefit
- Current media landscape plus increased skepticism requires multiple voices and channels
- Demand for authority and accountability set new expectations for corporate leadership
- Trust is a protective agent and leads to tangible benefits; lack of trust is barrier to change
So, what will the 2012 study, due out in January, reveal? What will this mean for executives?
At the AESC Researchers and Associates Summit, which took place in New York City on October 21st, Robert F. Hurley Ph.D. (management consultant, professor at Fordham University, faculty at Columbia Executive Programs, and author of The Decision to Trust: How Leaders Create High-Trust Organizations) spoke to participants about building advantageous relationships, trust, and influence.
Hurley addressed our skeptical era, where trust in business has seen a decline for roughly the past 30 years. Hurley outlined the critical dimensions of relationships, which involve both trust and satisfaction. Furthermore, for trust to be present there must also exist vulnerability, risk, and uncertainty. Competence is also a big part of the trust equation. But at what point does risk and uncertainty become too much—at what point does a slip in competence lead to mistrust? 2011 provides many examples to illustrate the point. As Hurley stated at the AESC summit, betrayals over time create systemic change (i.e. The Arab Spring). On the flipside, benevolent concern—empathy, listening, and responding to shared information—instills trust. Benevolent concern, moreover, leads to the ability to set expectations (competence). Sympathizers of the Occupy Wall Street movement feel that the financial services and banking industries (with government implicated as well) have not expressed benevolent concern, and therefore are not to be trusted.
So what do executives have to learn from all of this?
Successful leaders must embody trust. Furthermore, trust is a protective agent with quantitative, not just qualitative, rewards. Look to the late Steve Jobs as an example of the quintessential trustworthy leader. Through social benevolence, transparency, authority, and accountability, Steve Jobs instilled trust, and with that trust, he also engendered belief—in a product, in a company, in an idea. Apple is a better company because of trust, both qualitatively and quantitatively, and many would argue, because of that, so is society at large.
What will happen to the global trust scale in 2012—it is still too soon to tell. But executives can start working on their own trust forecasts for 2012 today. We may be in era of disbelief, but the world is hungry to believe. A clear plan to embody trust can take leaders and companies far throughout the new year and beyond.
This article was written by Joe Chappell from the Association of Executive Search Consultants (AESC).
BlueSteps is the exclusive service of the AESC that puts senior executives on the radar screen of over 8,000 executive search professionals in over 70 countries. Be visible, and be considered for up to 75,000 opportunities handled by AESC search firms every year. Find out more at www.BlueSteps.com.
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