Is the notion of organizational trust as an intentional business strategy moving beyond the “talk” stage?
Back in 2013 the World Economic Forum published their Leadership, Trust & Performance Equation paper with several partners including Edelman and PwC. Fast forward to 2016 and the subject of building trust again appeared on the agenda at Davos, this time with four recommendations on how to accomplish this: Action, Values, Employee Advocacy and Engagement. Sounds like the beginning of a plan.
PwC published its own 2013 report Measuring and Managing Total Impact. These are just a few of its “trust sound bytes (note that this report also originated from Europe):
Consumers are becoming ever more environmentally and socially conscious, especially younger ones: they want to know more than ever about the products and services they use and who they buy them from.
It is becoming impossible for companies to operate behind closed doors, so transparency is the new paradigm for conducting business successfully.
Reputation management: more open dialogue with stakeholders can improve business reputation (for example, by building trust and reinforcing the licence to operate) whereas “closed” businesses that fail to embrace new ways to communicate could be adversely affected (for example, if they are implicated in environmental damage or species extinction, tax avoidance or poor labour standards).
Clearly, businesses have to satisfy their shareholders’ demands. But, as we have seen, achieving this increasingly depends on their ability to meet the ever more exacting expectations of a broader set of stakeholders, stretching from customers, employees and suppliers to politicians, environmental groups and nongovernmental organisations (NGOs).
This is prompting some business leaders to consider how best to tell their own story, not just that required by legislation.
Looking forward, with trust at an all-time low, business must recognise that it is already operating in new conditions where society’s expectations are quite different and the need to rebuild trust is irrefutable. In particular, it needs to explain its purpose and manage its impact, not only through its direct operations, but also across its entire value chain, including all its stakeholders. This heightens the value of impact measurement as a means to better understand, demonstrate and manage its role and contribution to society.
And more recently PwCs own trust research and insights blog began writing a series of topical articles.
I think it’s good news that these large global organizations are, at a minimum engaging in a discussion about elevating trust in business. But four ongoing challenges remain:
- Whether they are able to take the discussion to the implementation phase.
- Whether all the organizations (PwC & WEF are just two of many) are willing to set their own personal agendas aside and combine all their resources to solve one of the most critical business issues of our time.
- Whether leadership in public companies recognizes the need to adopt organizational trust (which extends way beyond sustainability, corporate responsibility and “giving back”) as an intentional holistic business strategy and are willing to make the long-term changes required to do so.
- Whether PwC, the WEF and other organizations see the value in opening their closed door discussions by bringing the “right” people to the table, those with expertise and first hand experience in organizational trust, culture, engagement, ethics, compliance, leadership, Board composition, etc.
What do you think? Is progress being made or are we permanently stuck in “talk.”
Barbara Brooks Kimmel is the CEO & Cofounder of Trust Across America-Trust Around the World whose mission is to help organizations build trust and integrity. She facilitates the world’s largest membership program for those interested in the subject. Barbara also serves as editor of the award winning TRUST INC. book series and the Executive Editor of TRUST! Magazine. In 2012 Barbara was named “One of 25 Women Changing the World” by Good Business International.
Copyright 2016, Next Decade, Inc.