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Posts Tagged ‘Trust Inc. A Guide for Boards & C-Suites’

Oct
27

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What do low integrity and trust cost an organization and the economy? The research studies cited below should give our readers some insight:

  • Gallup reports that employee engagement was more or less stagnant in 2015, (over 17% actively disengaged.) In 2014 less than one-third of US workers were engaged in their jobs, with millenials the least engaged, and this is costing the US economy $450-550 billion a year, which is over 15% of payroll costs. (Gallup, 2015)
  • The Association of Certified Fraud Examiner’s survey participants estimated that the typical organization loses 5% of its revenues to fraud each year. Applied to the 2011 Gross World Product, this figure translates to a potential projected annual fraud loss of more than $3.5 trillion. 2012 Global Fraud Study
  • According to The Economist Intelligence Unit (2010), 84% of senior leaders say disengaged employees are considered one of the biggest threats facing their business. However, only 12% of them reported doing anything about this problem.
  • The cost of Federal Regulations is approaching $2 trillion annually according to a study by the Competitive Enterprise Institute.
  • According to a recent report by PwC the U.S. held its position as the top location for innovation, with in-country R&D spending of $145 billion in 2015. However, other countries (i.e., China) increased their R&D spending by greater proportions than the U.S. which caused it to lose some of its relative advantage.
  • Volkswagen lost 20% of its stock value after the emissions scandal and Target’s profits fell 34.3% after it’s data breach.
  • A study by Murphy, Shrieves and Tibbs called “Determinants of the Stock Price Reaction to Allegations of Corporate Misconduct” finds that allegations of misconduct are accompanied by statistically significant control-firm adjusted declines in reported earnings, increases in stock return variability, and a decline in concordance among analysts’ earnings estimates.”
  • In a 2008 study by Karpoff, Lee and Martin called “The Cost to Firm’s of Cooking the Books,” the authors find The penalties imposed on firms through the legal system average only $23.5 million per firm. The penalties imposed by the market, in contrast, are huge.
  • The PR firm Edelman finds in their 2016 “Trust Barometer” that nearly one in three employees don’t trust their employer. And more than two thirds feel that CEOs are too focused on short-term performance. As a result, employees are far less likely to say positive things about the company they work for.

The trust gap not only negatively impacts a company’s revenue, market share, brand reputation, employee engagement and turnover, stock price, and bottom line profitability, but every facet of society.

What happens when integrity & trust increase?

Find out in our new white paper: The State of Trust in Corporate America 2016. Request it here.

Copyright (c) 2016 Next Decade, Inc.

 

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Sep
22

 

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If your work brings you in contact with others, and chances are it does, how much time do you, your team or your leaders spend discussing how your internal and external stakeholders perceive the company’s integrity? How much time is allocated to reinforcing the notion that strong corporate culture built on trust and integrity are business imperatives? If your answer is “little to none” you are not alone. As a former CEO told me, most leaders are too busy putting out the day-to-day fires to think much about “soft skills” like integrity. One need only refer to the latest Wells Fargo and Mylan scandals to see what happens when culture, trust & integrity are of little importance to corporate leadership. Ironically, many of these same crises could be averted if the “soft skills” were a business imperative.Why does organizational integrity matter? Can, and should it be measured?

Why do organizational trust and integrity matter?

When the culture and core values of an organization are not only strong but also reinforced daily, and leaders keep their word, the following occurs:

  • Employees are more engaged and turnover decreases
  • Innovation increases
  • Decisions are made faster
  • The reputation “bank account” grows
  • Crises diminish
  • Profits are higher

According to a 2011 Booz & Co. study, “The Global Innovation 1000: Why Culture is Key,” companies with both highly aligned cultures and highly aligned innovation strategies have 30 percent higher enterprise value growth and 17 percent higher profit growth than companies with low degrees of alignment.

A 2013 study by Guiso, Sapienza and Zingales called “The Value of Corporate Culture” finds that proclaimed values appear irrelevant. Yet, when employees perceive top managers as trustworthy and ethical, firm’s performance is stronger.

And in the absence of strong core values…

  • Volkswagen lost 20% of its stock value after the emissions scandal and Target’s profits fell 34.3% after it’s data breach.
  • A study by Murphy, Shrieves and Tibbs called “Determinants of the Stock Price Reaction to Allegations of Corporate Misconduct” finds that allegations of misconduct are accompanied by statistically significant control-firm adjusted declines in reported earnings, increases in stock return variability, and a decline in concordance among analysts’ earnings estimates.”
  • In a 2008 study by Karpoff, Lee and Martin called “The Cost to Firm’s of Cooking the Books,” the authors find The penalties imposed on firms through the legal system average only $23.5 million per firm. The penalties imposed by the market, in contrast, are huge.

Can, and should culture, integrity & trust be measured?

Jose Tabuena recently wrote an article for Compliance Week called “To Really Improve Corporate Culture it must be Measurable.” It’s worth a read. The essence of the article is that “good measurement informs uncertain decision-making. And if you measure what matters, you make better decisions.” While corporate culture, core-values, good citizenship, ethics, integrity and trust are commonly believed to be immeasurable intangibles or soft skills, evidence like that provided above point to the fact that these are not only false beliefs, but also that the benefits of ethical cultures far outweigh the costs. Yet most leaders continue to hold fast to the “soft skills” argument because neither they nor their Boards of Directors are thinking about them, being provided with the “right” data and/or because systemic change is:

  1. Hard work
  2. Takes time and
  3. Requires an “all hands on” approach.

Much of our work at Trust Across America-Trust Around the World focuses on measuring the integrity or trust “worthiness” of pubic companies and identifying “best in breed” via a unique, holistic lens called the FACTS® Framework.

Developed by a cross-silo multidisciplinary team, and in the wake of the financial crisis in 2008, the framework began to take shape by asking the same question of dozens of “siloized” professionals from leadership, compliance and ethics, legal, accounting, finance, HR, consulting, CSR, sustainability, etc. “What do you consider an indicator of corporate integrity or trust “worthiness” that can be independently and quantitatively measured without requiring the input of the organization itself? And while every professional had a different perspective, the same indicators were mentioned time and again. “In order for a company to be trust “worthy” it must display good corporate governance said the governance folks.” Similarly the financial professionals pointed to stable earnings, the accounting group talked about forensics, and so on. And by blending all of these indicators of corporate trustworthiness into a very large integrity spreadsheet, we found ourselves able to measure integrity and trustworthiness with some degree of accuracy. The master spreadsheet also makes glaringly apparent where and why the Enron-like “risk” often lays hidden in these 1500+ public companies.

Fast forward, and with eight years of unique and compelling data, the majority of companies and their leaders continue to hold on to the notion that trust is a soft and immeasurable skill, and that data from one corporate silo to the next need not be viewed as a holistic “whole body” scan. After all, it’s very hard to balance long-term value creation against the need to “maximize earnings” and meet the always-looming quarterly numbers. Better to wait until the next corporate crisis to talk about the importance of trust and how measures will be implemented (maybe) to safeguard against future missteps. Or maybe it’s time to start thinking more carefully about integrity & trust.

According to our FACTS® Framework, during the three-year period from February 2013-February 2016 America’s most trustworthy public companies substantially outperformed the S&P 500 according to the actual composite audited performance shown below and reprinted with permission of Facts Asset Management, LLC.

FACTS SP 500 Returns

This was not a “back test” but rather “live” money under management, followed by an independent audit verifying the returns. Trust works as a business strategy.

FACTS® Managed Accounts were independently audited from Feb.1, 2013-Jan.31, 2016. Prepared by FACTS Asset Management LLC. FACTS® is our model of identifying America’s Most Trustworthy Companies by applying FACTS strategy parameters. The composite results translate to 50.09% for FACTS® and 28.1% for the S&P 500 cumulative percentage return shown above, or 16.7% average annualized for FACTS® vs. 9.5% for the S&P 500 over the same period.  The audited Composite Performance results shown above may not be indicative of future results.  Full audit documents available upon request.

The composite performance records are based on all accounts managed using the FACTS strategy for a three year period, 2/1/13 to 1/31/16 and are not representative of the FACTS® Asset Management LLC program. Tax consequences are not reflected in the performance records.  Past performance is not an indication of future return.  There can be no guarantee that a new program will prove to be profitable in the future or that it will achieve performance results similar to those achieved in the past using the FACTS strategy parameters and you may lose money.  The performance numbers reflect the reinvestment of dividends.  The composite performance net of fees is calculated using a weighted average fee for the entire period because not all accounts were charged equal fees and some accounts were not charged fees. The S&P 500 is a widely recognized market value-weighted index of 500 stocks designed to mimic the overall U.S. equity market’s industry weightings, and does reflect the reinvestment of dividends. Past results are not necessarily indicative of future results.

FACTS® Asset Management LLC is a New Jersey registered Registered Investment Advisor. Prepared by FACTS Asset Management LLC

 

While no company is perfect, a growing group of visionary leaders have struck that balance and are reaping the rewards shown in the chart above. Over the years our FACTS® Framework has identified many high integrity companies who share above average scores across all measurable indicators of trust “worthiness” and a leadership vision that embraces the new strategic business imperative of elevating integrity & trust.

Leaders that measure what matters, including trust, DO make better decisions and over time they are rewarded with lower risk and higher profitability.

Barbara Brooks Kimmel is the CEO and Cofounder of Trust Across America-Trust Around the World whose mission is to help organizations build trust. Now in its seventh year, the program’s proprietary FACTS® Framework ranks and measures the trustworthiness of over 1500 US public companies on five quantitative indicators of trust. Barbara also runs the world largest global Trust Alliance, is the editor of the award winning TRUST INC. book series and a Managing Member at FACTS® Asset Management, a NJ registered investment advisor.

 

Copyright © 2016, Next Decade, Inc.

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Nov
24

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A spate of corporate crises in 2015 have only served to fuel the long-term fire of low organizational trust. Under the theory that trust starts at the top and trickles down, we asked our Alliance Members and Top Thought Leaders how Boards of Directors can be the catalyst to drive organizational trust in the right direction in 2016.

Our readers will find twelve suggestions below:

 

Boards must replace fear with trust:

A trust-based culture increases morale, productivity, innovation, speed, agility, pride in the workplace, value to the customer and sustained high performance.

Edward Marshall, The Marshall Group

 

Boards must widen the scope of their membership:

Diverse boards bring different and new types of expertise and perspectives, increasing the range of topics discussed, and most important, encouraging open, candid and provocative discussions.

Nadine Hack, beCause Global Consulting

 

Boards and CEOs must be proactive:

Boards can and should lead certain functions for the firm from defining the desired culture to involvement in strategy development. They should not be passive monitors.

Bob Vanourek, Triple Crown Leadership

 

Board members must have authentic conversations:

They must be provided with sufficient information; a safe space that protects privacy and rejects behaviors to intimidate, ridicule or insult; and enough time to explore systemic issues without jumping to conclusions.

Alain Bolea, Business Advisors Network

 

Boards must avoid entrenching polarized attitudes:

Boards must have synergy. Look for warning signs in communications including “we versus they” or “if only we can get them to do this.”

Bob Whipple, Leadergrow

 

Board members must ask the tough (ethical) questions…and act on the answers:

Tie compensation and bonuses to ethical leadership metrics as well as financial performance.

Donna C. Boehme, Compliance Strategists

 

Boards must demand management accountability:

Mission, purpose, values, culture, strategy, business model and brand must be thoughtfully defined, activated and aligned to create a coherent whole.

Roger Bolton, Arthur Page Society

 

Boards must align their business agenda with societal expectations:

Board members must have an unmistakable sensitivity to the societal issues of the day. Capabilities must be aligned to build a better world AND a better company.

Doug Conant, Conant Leadership

 

Boards must speak with candor:

The canned, compliance-approved double-talk and corporate window dressing must be replaced. It is, at best, a short-term unsustainable business strategy, and hiding behind philanthropic efforts simply doesn’t work. Boards must build cultures of authentic long-term trust, practice it holistically, and regularly communicate it to all stakeholders.

Barbara Brooks Kimmel, Trust Across America

 

Boards must kill the evening before dinner:

Instead take a small group of front-line or mid-level employees to dinner in an informal setting without the presence of other corporate executives.

Robert Galford, Center for Leading Organizations

 

Board must understand their organization’s relationship with their stakeholders:

Take surveys, monitor social and legacy media, and share information across the organization; track the emotions of issues, events and topics, follow changes in the environment; engage and address concerns.

Linda Locke, Standing Partnership

 

Boards must develop their own crisis plan:

Enumerate what kinds of actions will be taken for different issues, their crisis strategy and who will be designated to play “first string.”

Davia Temin, Temin and Company

 

What would you add to these recommendations? Drop me a note at barbara@trustacrossamerica.com

Dozens more suggestions like this can be found in Trust, Inc: A Guide for Boards and C-Suites and in our brand new 2016 annual poster Weekly Ideas That You Can Implement to Build Trust

 

 

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Nov
17

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Imagine visiting a shoe store and failing to provide the salesperson with information on your shoe size, color or the style you are seeking yet expecting to leave with the shoes that meet your needs.

Rarely a day passes without a note or a call asking some variation of the following question:

Do you have a questionnaire or a tool, to detect the level of trust in an organization?

And every time, I respond with “What are you trying to measure or detect?”

Trust is not a “one size fits all” proposition. These are just a few of the variations, and each has it’s own tool and/or assessment mechanism:

  • Self-trust
  • Internal trust including trust among team members, between teams, and trust between leaders and employees.
  • External trust between the organization and its stakeholders including suppliers, vendors and customers.
  • Organizational trust or its trust “worthiness” both internally and externally.

In most organizations trust is taken for granted perhaps because of the simple belief that “one size DOES fit all.” I hope you enjoy your shoes and that they meet your needs!

Barbara Brooks Kimmel is the CEO & Cofounder of Trust Across America-Trust Around the World whose mission is to help organizations build trust. She facilitates the world’s largest membership program for those interested in the subject. Barbara also servers 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 2015, Next Decade, Inc.

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Sep
12

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Our September Trust Quest asked the following question:

What is the bigger issue in your organization? 

Leadership doesn’t trust its employees?

Employees don’t trust their leaders?

And here are the results of our poll…

 

Trust Quest Final September 2015 Summary Report copy

71% of our respondents said that employees don’t trust their leaders.  What does this say about leadership? How long will leaders continue to ignore the impact on their organization of low employee trust including:

  • Disengagement
  • High turnover
  • Low innovation
  • Poor morale

 

Trust starts at the top. It can’t be delegated to HR or any other department. The tools to build trust are readily available to enlightened leaders who choose to make trust a business priority.

Barbara Brooks Kimmel is the Executive Director of Trust Across America-Trust Around the World whose mission is to help organizations build trust. She facilitates the world’s largest membership program for those interested in the subject. Barbara is also the 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.

Our annual poster, 52 Weeks of Activities to Increase Organizational Trust is available to those who would like to support our work by making a small donation.

Did you know we have published 3 books in our award-winning TRUST Inc. series. They are yours when you join our Alliance.

Copyright 2015, Next Decade, Inc.

 

 

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Jul
30

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Welcome!

While our monthly roundup is normally a collaborative undertaking of our Trust Alliance, this month we gave our members a well-deserved holiday and instead assembled a handful of Barbara Brooks Kimmel’s most popular articles and interviews of 2015.

Our goal is to provide our readers with  a better appreciation for the importance of embracing trust as an organizational imperative.

Let’s get started!

In this Forbes article some tough organizational trust questions are answered, including:

  • “How can individuals and organizations capitalize on trust?”
  • “Jack Welch recently said that the only thing an executive today should be focused on is trust. Why do you think Mr. Welch have arrived at that conclusion in 2015?”

Our July Trust Quest asked: Which is the greater problem facing today’s society? Is it an unwillingness to trust others or alternatively, that people just aren’t trustworthy enough? Here’s the results of the poll. Our August poll launches on August 1. We hope you will participate.

The terms compliance, ethics and trust are often used synonymously when they shouldn’t be. What’s the difference and how can leaders ensure that trust stands alone? This Culture University article answers those questions.

Our most popular post year-to-date simply asksIs it Too Lonely at the Top for Trust?

And finally, the most downloaded article from our website, and perhaps the key that unlocks the trust door is called “Return on Trust.” It’s a reprint from our quarterly magazine called TRUST!

Enjoy!

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Jul
27

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How do low-trust leaders communicate when faced with a trust breach? Here’s a quick sampling of 10 “one- liners” pulled from the headlines over the past several weeks.

  1. “It was our legal right to do so.”
  2. “I had no hard evidence.”
  3. “Errors are inadvertent and happen.”
  4. “We will increase our compliance monitoring.”
  5. “There was no calculation to mislead people.”
  6. We’re all a bit stunned by the news.
  7. “I mean it when I say we screwed up.”
  8. “No comment at this time.”
  9. “We continue to cooperate with the relevant authorities on pursuing those responsible for this criminal act.”
  10. “I was totally unaware that this was in the works.”

Huh, what and are you kidding?

Why do we continue to read these rehashed headlines after a trust violation and why do leaders use these excuses? Very simply because organizational trust is not regulated; it’s voluntary. And because of this one simple fact, trust is largely ignored in most organizations. It’s not practiced proactively unless leadership places trust high on it’s business agenda. That’s called intentional trust, and it’s very rare. Instead, most leaders wait for the next crisis (which is a “given” in low trust organizations) and then pull an excuse from the list above, usually with the assistance of the legal department.

If ANY leader of ANY organization actually believes that these “one-liners” build long-term trust with stakeholders, please drop a note to barbara@trustacrossamerica.com . I have a bridge I’d like to sell you.

 

Barbara Brooks Kimmel has been the Executive Director of Trust Across America-Trust Around the World  since 2008. The program’s mission is simply to provide tools and assistance to organizations interested in building trust. Barbara runs the world’s largest organizational trust membership program. She is also the 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.

Barbara is an award-winning communications executive and former consultant to McKinsey who has run her own firm, Next Decade, Inc., that has been unraveling and simplifying complex subjects for over twenty years. She holds a BA in International Affairs from Lafayette College and an MBA from Baruch (City University of NY).

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Jul
01

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Welcome!

Our monthly roundup is another collaborative undertaking of our Trust Alliance, selected blog posts on a variety of organizational trust topics. The subjects are as diverse as the expertise of our members!

By reviewing these posts, our readers will have a better appreciation for the importance of embracing trust as an organizational imperative.

Let’s get started!

What is the outcome when terms like “brutally honest” are used? Holly Latty-Mann discusses this in Trust and Honest Feedback: Up Close and Personal

Do you trust your employees to tweet about the company? Nan Russell shares some excellent advice in Psychology Today.

Taina Savolainen an academic partner from Finland discusses the role of story-telling in building organizational trust.

Linda Fisher Thornton wonders what our workplaces would be like if every leader cared about others.

My most popular post this month introduces Trust Across America’s VIP Model. Take a look!

And finally, what does your “place” smell like? This is an excellent 8 minute speech by Professor Sumantra Ghoshal at the World Economic Forum. It’s about corporate environments and the faults of management in creating a positive work place. The goal is “trust” and Professor Ghoshal explains why in “The Smell of the Place.” The speech has been accessed almost 85,000 times.

Barbara Brooks Kimmel is the Executive Director of Trust Across America-Trust Around the World whose mission is to help organizations build trust, and runs the world’s largest membership program for those interested in the subject. She is also the 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.

Our annual poster, 52 Weeks of Activities to Increase Organizational Trust is available to those who would like to support our work by making a small donation.

Did you know we have published 3 books in our award-winning TRUST Inc. series. They are yours when you join our Alliance.

Copyright 2015, Next Decade, Inc.

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Jun
24

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In most companies trust is taken for granted until a crisis threatens earnings and subsequent shareholder loyalty. And because it’s not regulated, most CEOs ignore the word “trust” completely. Just ask any CEO how trustworthy they think their company is, and depending on the route they took in their ascent through the ranks, these are the responses you will most likely receive:

  • The College Sports Team Captain:  “Trust is an outcome of wins over losses.”
  • The Chief Marketing/Communications Officer: “Trust is gained or lost according to the message we deliver.”
  • The Military Officer: “Trust is a product of strong teams.”
  • The Milton Friedman follower: “Our quarterly earnings are growing so we are trusted by our shareholders.”
  • The Chief Compliance Officer: “If we abide by the regulations, we are trustworthy.”
  • The General Counsel: “If we don’t break any laws, we are trustworthy.”
  • The Chief Financial Officer: “Our level of trust is measured in our income statement and balance sheet.”
  • The Investment Banker: “We benchmark our trust against our competitors.”

If all these definitions are correct, then why are the levels of trust so low, not only in corporate America but globally? The answer is simply, “The definitions are wrong.”

Fortunately some leaders, and their Boards have tossed these “old school” siloed and limited definitions of organizational trust to the curb.  We are beginning to see the emergence of a new “class” of enlightened CEOs who are leading very differently and their companies are thriving.

  • The Values Based Leader: We define trust according to how trustworthy I am viewed as a leader.
  • The Trust Based Leader: We define trust through our leadership and organizational values, and how well we are meeting the needs of all our stakeholders- shareholders, employees, customers, suppliers, community, etc.

Trust begins with leadership that recognizes its value and embraces it as a long-term business strategy. Until leaders at both the Board and CEO level lose their “old school” definition and adopt a new one that works, trust will stagnate. CEOs will continue to extinguish the daily fires by hiring more compliance staff to meet the needs of the ever increasing regulations that are written as a result of low trust and trust violations. Sounds like a never-ending cycle of mistrust … and a short-term strategy at best.

I challenge all CEOs and Boards to lose their old definition of trust and replace it with one that works. Start by becoming a values based leader and trust will follow.

Barbara Brooks Kimmel is the Executive Director of Trust Across America-Trust Around the World whose mission is to help organizations build trust. She also facilitates the world’s largest membership program for those interested in learning more about the subject. Barbara is the editor of the award winning TRUST INC. book series and the Executive Editor of TRUST! Magazine. In 2012 she was named “One of 25 Women Changing the World” by Good Business International.

Our annual poster, 52 Weeks of Activities to Increase Organizational Trust is available to those who would like to support our work by making a small donation.

Did you know we have published 3 books in our award-winning TRUST Inc. series. They are yours when you join our Alliance.

Copyright 2015, Next Decade, Inc.

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Mar
15

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As the co-founder and Director of Trust Across America – Trust Around the World, I’ve been studying organizational trust (and trustworthiness) for the best part of seven years, have spoken to hundreds of global experts, and read thousands of articles, blog posts and books. I’ve also edited and contributed to three books in our TRUST Inc. series, publish a magazine called TRUST!, and regularly attend and speak at conferences. Some might call me an expert, but nothing could be farther from the truth. In fact, the more I learn about trust and trustworthiness, the less I understand it.

If you are like me, it’s almost impossible to go a full week without the news covering another major trust violation. Last week it was Hillary’s turn, before that Bill O’Reilly following on the heels of Brian Williams, and so on. These stories come and go and the American public has come to accept them as the norm. In fact, with each violation, the shock factor seems to diminish.

The following are ten observations I have made about trust & trustworthiness in American society:

  • Because there is no universally accepted definition of trust, your definition of trust and your standards of trustworthiness are different than mine. In fact, even prisoners think they are more trustworthy than the general population. Some of the self-proclaimed trust and leadership experts I have met are the least trustworthy upon close and careful inspection of their character, competence and consistency, yet they believe they are in a position to advise others.
  • As family “time” has eroded over the past generation, the moral compass that, in the past guided future generations (parenting) has all but disappeared. Compound this with the “win at all costs” mentality promoted by coaches on athletic fields across America and future generations may not be empowered with the right tools or behavior.
  • America’s entire public educational system is based on “grades” not learning, and cheating and grade inflation have become an accepted norm in schools and universities. Parents “game” the system by having their children classified as “math anxious or test frightened” so they are allotted extra time on tests to boost that all important GPA, and Athletes have it the best. In other words, parents are not helping their children to grow up to be trustworthy adults.
  • Government officials, beginning with our local community leaders place their political agendas before the betterment of the constituents who elected them, and this obliterates the opportunity to build community trust. Our elected officials believe that if they don’t violate any laws, they are trustworthy. Americans are very forgiving of trust violations and even outright lies. In fact they overlook them.
  • Same goes for corporate America. Our “win at all cost” athletes and students are considered to be the “best in class” and are recruited by major companies. There’s no “moral compass litmus test” administered before the job offer. Similar to our government leaders, corporate leaders also believe that as long as they stay “just to the right” of compliance, and grow their quarterly earnings, there is no need to give a second thought to cultivating a trustworthy organization or hiring for the “right” reasons. Stock buybacks, executive compensation and short-termism are all trust busters.
  • Boards of directors don’t understand the role of organizational trust any better than the leaders they select. One need look no further than the composition of most Boards to appreciate and understand this.

Rules are often put in place to curtail the abuses of the past. A “leader” that is only guided by compliance begs the question: What would their behavior be in the absence of rules? Does one want to follow someone that needs rules to know what is right? Or are true leaders to inspire trust by staying clear of conflicts of interest and abuses of power.

  • The word “trust” is so overused and misused that it is no longer sacred. The media throws around the word “trust” as if it were  a headline hot potato. Frequently, journalists and writers confuse trust with regulation, loyalty and ethics. But the word “trust” is a better sound byte, so why not misuse it?
  • And speaking of the media, they continue to perpetuate low trust by focusing only on the bad actors, giving no “space” to those who are doing the right thing.
  • I frequently talk about trust with leaders of organizations of different shapes and sizes.  Not only do they not “get it” they have little interest in learning. They believe trust is all about falling into someone’s arms and hoping they catch you.  Instead of embracing trust as a business strategy, leaders hold their collective breaths hoping they are not the subject of the next news headline.

Is there a silver lining to this bleak picture?  Yes, because some families still gather around the dinner table every night and not every child is a cheater. There will always be the Bobby Knights vs. the Mike Krzyzewskis, and the first day of work for a new hire at Zappos may be very different than the first day at JP Morgan. In other words, industry is not destiny. Like most things in life, trustworthy people and organizations line up along a bell curve. Half are below average, but half are above average, and a select few find themselves all the way to the right. They are the heroes and stars that should be making the headlines.

Just the other day, someone told me that Trust Across America – Trust Around the World is making a difference. I suppose the growth of our Alliance proves that we are moving in the right direction. But a gnawing fear remains. Trust is not only misunderstood, overlooked or taken for granted by most people, leaders and organizations, it’s also voluntary. And, after all, why give a second thought to that which is not regulated, at least not in America?

Barbara Brooks Kimmel is the Executive Director of Trust Across America-Trust Around the World whose mission is to help organizations build trust. She runs the world’s largest membership program for those interested in learning more, and is also the 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.

Our 2015 Poster, 52 Weeks of Activities to Increase Organizational Trust is available to those who would like to support our work by making a small donation.

PrintND Trust CEO cvr 140602-ft914Trust front Cover

Copyright 2015, Next Decade, Inc.

 

 

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