The trust we place in leaders, both in businesses and politics, is in free fall. How can trust be restored?

KNOWLEDGE @ BI: Communication for Leaders

Like reputation, building up trust can take many years and can demand significant resources. While trust is not necessarily easy to shake, it could take a long time and even greater resources to restore trust that has been broken. The same applies to reputation.

According to Professor Roderick M. Kramer at Stanford Graduate School of Business, a person’s perception of the reliability of others, and the person’s willingness to trust them, is strengthened and weakened through long-lasting interaction.

Through this interaction, the parties receive information that they use to evaluate each other’s qualities, intentions and motives. Each party uses the information to determine whether the other party is reliable, and whether she (or he) can be trusted in the future.

Reputation then becomes a resource that lays the foundation for trust. There is a high probability that a person with a good reputation will also be trustworthy.

Measuring trust

Over almost 20 years, the communications agency Edelman’s has conducted an annual survey where they measure trust in 28 different countries. In this Trust Barometer, people with higher education and income (among the 25 per cent with highest earnings) are asked whether they trust that organisations do what they should.

The results from the 2017 survey are disheartening. A dwindling number of those interviewed believe that the institutions behave as they should. This applies to businesses, public enterprises, voluntary organisations and the media.

Trust in the media has fared worst. In a whopping 85 per cent of the countries surveyed, people respond that they do not trust the media. In 17 of the countries, the media scores an all-time low in the trust barometer.

While the trust in traditional media is diminishing, there is growing trust in information that people use search engines to find online.

Nearly six out of ten of those interviewed during this year’s survey trust more in search engines than human editors.

Do not trust leaders

The trust in leadership is deteriorating. This applies to businesses, governments and voluntary organisations. Seventy-five per cent of those surveyed respond that they have lost trust in their governments. The trust in voluntary organisations fell more than the trust in businesses in 11 of the surveyed countries.

Fewer than four out of ten (37 per cent) believe that senior business executives are credible. The credibility of senior business executives has dropped in nearly all the countries surveyed. The company’s employees are perceived as more credible than the leaders. People have the greatest trust in their peers, i.e. people that they can compare themselves to, and experts. But trust is also diminishing here.

Trust in the countries’ political leaders has fared even worse. Fewer than three out of ten (29 per cent) believe that the political leaders are credible.

Loss of trust in five stages

Senior researcher Garry Honey from the Centre for Risk Research at the University of Southampton has identified five stages of loss of trust:

  1. Disappointment in inconsistent behaviour causes the trust to be questioned. However, the organisation can quickly restore this.
  2. Surprise over poor judgement or poor management by the organisation, so that trust is shaken. The organisation can restore the trust over time and through building good relationships/networking.
  3. Concern regarding an accident or issue related to safety, such as the recalling of a product. The result is weakened trust. It takes a lot to restore this.
  4. Disgust over the organisation’s incompetence and poor decision-making process. Trust is seriously damaged and is never fully restored.
  5. Fury that the organisation could become involved with things such as fraud, embezzlement and other illegal activities. All trust is irrevocably lost and cannot be restored.

When people no longer trust an organisation, the first reaction is to stop buying all products or services from the organisation. This applies in the EU, US, Asia, as well as Latin America. They also do not want to work for the organisation or invest in it. And they make sure to tell others what they think.

How to build trust?

What can organisations do to build trust? The advice from citizens in most countries is unanimous/clear:

Organisations that treat their employees well, pay the required taxes, are open and transparent, work to take care of and improve the environment and place customers ahead of profits, build trust.

More than half believe that the ability to listen is important to build trust.

According to Edelman’s, organisations can regain trust by investing in flatter and more participatory communication models. This e.g. entails that the organisation considers all stakeholders before acting. This is nothing new, and is a core pillar in strategic enterprise communication.

Listening to the stakeholders is also an important first step in building a good reputation. But models must also be converted into practical action. And there is still a way to go here.

References:

Brønn, P. S. (2018), Åpen eller Innadvendt, (2nd edition). Gyldendal.

Edelman’s Trust Barometer 2017, http://www.edelman.com/trust2017

This article is first published in Communication for Leaders No. 1 – 2017 (in Norwegian). Link to E-magazine: https://issuu.com/bi_business_school/docs/communication_for_leaders_2017_issu

Communication for Leaders is a Science Communication Magazine published by Centre for Corporate Communication and Department of Communication and Culture at BI Norwegian Business School.

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