Trust matters

It’s very tempting to dismiss the latest results of a survey from PR firm Edelman that suggests trust in Australia’s chief executives is rising.

But perhaps that’s because I am a journalist, and my lot is always put (very unfairly of course) at the bottom of trust rankings, down there with the used-car salesman.

However, the fact that the trust rating of Australia’s chief executives has climbed in the last two years – around half of Australians trust CEOs to do what is right, while 54% trust businesses to do the same – is noteworthy.

I wonder if it might suggest the hard work the companies have put into become more transparent, and the extra efforts put into corporate social responsibility, have had some impact.

In this hyper-connected world, company leaders at big companies and small companies know that the personal brand has become a lot more closely linked with their company’s corporate reputation.

When a company stuffs up, the media and the public will be extremely quick to identify the executive or executives responsible.

Executives that try to hide behind spin, dodge issues or use corporate speak to address an issue will receive their own reputational hammering.

For executives that are as transparent as possible, who acknowledge problems and try to deal with them, the hammering will be less severe.

In the last few years, there appears to have been a shift towards leaders who understand that there is a real value in establishing a level of trust with customers and other stakeholders. This is generally done by having an open, accessible and honest approach, and a strong focus in areas such as community relations and corporate social responsibility.

The GFC, and the subsequent regulatory crackdowns by governments around the world, has probably forced many leaders to spend so time focusing on this idea of trust.

But the Edelman survey should remind leaders this needs to be more than a post GFC effort.  The survey showed 73% of respondents still “support government regulation of corporate activity to ensure business is behaving ethically and responsibly”.

That alone should be enough to make business leaders continue their trust-building efforts.