Leaders not Trusted

Leadership trust is the glue that keeps hope alive

Recent reseach by Edelman Trust barometer again revealled some shocking trends.


Less than 1 in 5 respondents in the 2013 Edelman Trust Barometer
believes a business or governmental leader will actually
tell the truth when confronted with a difficult issue.

“We’re clearly experiencing a crisis in leadership,” comments Richard Edelman, president and CEO.
If we are to create a POSITIVE TRUSTED WAY FORWARD WITH real LEADERSHIP AND NOT greeders…“Business and governmental leaders must change their management approacH.  They need to become more inclusive by seeking the input of employees, consumers, activists and experts such as academics, and adapting to their feedback.
They must also pass the test of radical transparency.” The general public’s trust in leaders is far below that of institutions in all 26 markets.
Globally, trust in business to do what is right is at 50% while trust in business leaders to tell the truth is 18%, a 32-point trust gap; the gap between government and government official is 28 points. The trust gap between business and business leader is amongst the largest (35 points) in the US and China. At 47 points, China had the greatest divide between government and government official.
This year’s Barometer also reveals that academics, technical experts and users are nearly twice as trusted as a chief executive or government official. “This confirms the democratising trend of recent years with influence and authority moving away from CEOs and government leaders to experts and peers,” says Edelman. Trust across all institutions increased, including narrow upticks for business and government.
3 of 4 institutions (NGOs – 63%; media – 57%; business – 58%) surpassed their all-time-highs. While there was an increase, it was tentative, with only 17% and 16% of those who trust business and government, respectively, saying they trust either business or government a great deal.
Trust’s fragility was further exemplified by a January follow-up study done in the US and UK. Trust in media in the UK experienced a dramatic 14-point drop, after the release of the Leveson Inquiry – an investigation into the role of the press in the phone-hacking scandal – making it the least trusted institution. In the US, trust in government dropped eight points among the general public, making it the least trusted institution, after the poor handling of the fiscal cliff issue. Overall, the general population is far more sceptical of institutions than informed publics. Trust across all four institutions is nine points lower among the general population; the largest difference, 14 points, is seen in the US, Sweden and Poland. Banks and financial services remain the least trusted sectors particularly trust in banks in Germany (23%), UK (22%), Spain (19%) and Ireland (11%).
Trust in these sectors reached their lowest point in the US in 2011 and in the UK, France, and Germany region in 2012. With trust in two-thirds of the markets below 50%, trust in banks, globally, is now 11 points lower than it was in 2008. The Barometer finds that this lack of trust is driven by poor performance and the perception of unethical behaviour. Developed economies rate bank performance much lower than emerging markets, giving the industry poor grades in its practice of lending to small businesses and providing home mortgage loans. More than one in two people globally (56%) say they were aware of last year’s banking and financial services scandals (78% in the UK) with 59% saying the cause of those scandals was behaviour, specifically corruption, poor corporate culture or poor leadership.
“The financial services industry must become more aggressive in explaining its business model and do away with terms such as ‘proprietary trading’,” says Alan VanderMolen, president and CEO: global practices at Edelman and vice-chairman of DJE. “Stakeholders have to understand how banks are making money and how the industry is working to benefit its shareholders and society.” The Barometer found multinational companies headquartered in developed markets consistently have higher trust levels than those in emerging markets (China, India and Mexico scored lowest). While companies headquartered in developed markets are trusted globally, companies headquartered in emerging markets face their biggest trust hurdles in developed markets. Furthermore, the Barometer also found that small businesses are most trusted in the West while big business is on top in emerging economies.
There’s been a dramatic change in how trust in companies is established as stakeholders are now placing greater importance on engagement and integrity-based attributes such as treating employees well, listening to customers and exhibiting ethical and transparent practices. Operational-based attributes, including financial performance and being recognised as a “best” place to work, were nearly twice as important in 2008 (76%) as they are in 2013 (39%).
“Innovative products and making money are now table stakes,” says Ben Boyd, global practice chair, Corporate, Edelman. “Business must show that it has a broader skill set and can execute on engagement and integrity-based attributes. Now is the time for business to go beyond simply earning the license to operate toward earning a license to lead, serving the needs of both shareholders and broader stakeholders by being profitable and a positive force in society.”
Other key findings from the Edelman Trust Barometer include: * Business leaders are trusted by less than 50% in 16 of 26 markets, while government leaders are trusted by less than half in 21.
* Technology (77%)
* Automotive (69%)were again the two most trusted industry sectors. * NGOs remain the most trusted institution posting trust levels above 50% in 23 of 26 countries – four of the five top markets are in Asia (China 81%, Malaysia 76%, Hong Kong 76%, Singapore 75%). *
Further dimensionalisation helped media continue its rise in trust that began in 2010. Among the general population, mainstream media and online search (both at 58%) are the most trusted sources of information. More than half in emerging markets trust all forms of media while developed markets have a high variance in trust levels across the various media types.
When looking at social media, emerging markets (58%) are more than twice as trusting as developed (26%). * Germany saw the most significant increases in trust across all institutions. NGOs up 16 points, media up 19 points, business up 14 points and government up 15 points. Argentina experienced the greatest decline in trust among all institutions.
The reality is our leaders are less than 50% effective and seem to be more GREEDERS than LEADERS…. If you are ready to transform your company into a high performance organisation – Contact ony Dovale for Talks, Team Building, LEadership Development Workshops, Coaching and Consulting. 083-447-6300