The sorry state of trust according to Edelman’s 2014 Trust Barometer

14-point trust gap

A key finding in the 2014 Trust Barometer published today by Edelman PR shows that, once again, public trust in governments around the world trails far behind trust in business.

Moreover, the ‘trust gap’ has increased markedly in the 2014 findings compared to 2013 – now a 14-point gap – and, indeed, overall compared to five years ago when the financial crisis was starting to bite.

While this gap illustrates a global average, where people’s trust in governments varies within each of the 27 countries in which Edelman conducted its research for the 2014 survey, it’s small comfort as the gap is driven by a decline of trust in government and not an increase in trust in business, Edelman says, with the gap at 20 points or greater in nearly half of the countries surveyed.

A few other highlights from the 2014 report’s findings:

  • Business is now expected to play a much bigger role around the debate and design of regulation as 79 percent of those surveyed believe government should not be working alone when setting policy.
  • A majority of respondents (84 percent) believe that business can pursue its self-interest while doing good work for society.
  • There is call for more regulation in several industries including financial services (53 percent), energy (51 percent) and food and beverage (48 percent). Regionally, the study found that 66 percent want more regulation of the financial services industry in Germany, 73 percent of people in the UK want more regulation of the energy business, while in China, 84 percent desire stronger regulation of the food industry.
  • Trust in CEOs has plateaued, and while they have recovered from a low of 31 percent in 2009 to 43 percent this year they still rank seventh out of eight, sitting only above government official (36 percent), as most credible spokesperson (and Edelman believes that CEOs must become “chief engagement officers” in order to educate the public about the economic, societal, political and environmental context in which their business operates).
  • Academics (67 percent) and technical experts (66 percent), a “person like yourself” (62 percent) and employees (52 percent) continue to be far more trusted. CEOs can build trust in themselves and their companies by communicating clearly and transparently (82 percent), telling the truth regardless of how unpopular it is (81 percent) and engaging regularly with employees (80 percent).
  • Globally, family-owned (71 percent) and small- and medium-sized businesses (68 percent) are more trusted than big business (61 percent).

Companies

  • Companies headquartered in BRIC nations continue to suffer a trust deficit compared to western-based companies. Globally, respondents rated companies based in Germany, a market known for efficiency and productivity, highest (80 percent) followed closely by Sweden (79 percent) and Switzerland (79 percent), both of which are known to have strong policies aimed at protecting the environment and employees and communities. Companies based in Mexico (34 percent), India (35 percent) and China (36 percent) were trusted least and have seen no improvement over the past five years.
  • Technology (79 percent) and automotive (70 percent) were once again the most trusted industry sectors, while banks (51 percent) were least trusted with dramatically low trust levels in Western Europe – Spain (16 percent), Italy (23 percent), UK (32 percent), Germany (33 percent) and France (38 percent).

This is the 14th annual report from Edelman that examines the state of trust in major economies. During the years, it has become a credible and trusted source of valuable insight into the intangible thing called “trust” that, increasingly, has tangible impact on business and government performance.

Retrospect

Note from the retrospect, above, the milestone findings in 2006, 2009 and 2012 – the effects of which we see markedly today.

One other finding in the 2014 report caught my attention – the power of search.

According to Edelman, there was a consistent answer to these questions:

When looking for general news and information, how much would you trust each type of source for general news and information?

On a typical day, what is the first source that you go to for general information about business?

What is the first source you go to for breaking news about business?

Which of the following sources do you turn to MOST often to confirm/ validate information on breaking news about business?

The answer? Not the mainstream (or social) media, but online search.

The power of search

People clearly prefer their own “natural search” methods rather than the pre-packaged (and untrusted) alternatives.

Edelman will be formally launching the 2014 Trust Barometer during a presentation and meeting in London on Tuesday January 21, 2014, at 8:30am GMT. You can see it live.

  • Shel and I will be discussing the 2014 Trust Barometer in this week’s episode 739 of The Hobson and Holtz Report podcast, recording today and publishing later today UK time.

Additional reading:

A leadership call to action to build trust

2013 Trust BarometerThe broad decline in trust in business and political leadership we’ve seen over the past few years took a deep dive during the last twelve months as, today, less than a fifth of people believe that a business or government leader will actually tell the truth when confronted with a difficult issue.

That’s the stark headline metric in the 2013 Edelman Trust Barometer published yesterday which, according to Edelman CEO Richard Edelman, “demonstrates a serious crisis of confidence in leaders of both business and government.” He says:

[…] The research confirms the democratizing trend of recent years – the redistribution of influence from traditional authority figures such as CEOs and prime ministers toward employees, peers and people with credentials, including academics and technical experts. A professor or person like yourself is now trusted nearly twice as much as a chief executive or government official. The hierarchies of old are being replaced by more trusted peer-to-peer, horizontal networks of trust.

Edelman’s report suggests that trust in institutions – companies, government, mainstream media, NGOs – is on the rise in many of the 26 countries in which Edelman carried out its research, compared to a year ago. But it’s diminishing leadership trust in general that is the major concern. These are topics that have been talked about by many in the communications profession in recent years, especially when Edelman’s trust report comes out each year (as it has for each of the past ten years).

Now, though, Edelman’s latest research adds a significant layer of credibility to the broad premise that the system really is broken and does need fixing.

The 2013 Trust Barometer offers plenty of unavoidable evidence of such breakage, identifying a number of areas that are clarion calls to action in organizations across all business and political boundaries.

For example, it’s unlikely to surprise anyone that banks and financial services remain the least trusted sectors, particularly trust in banks in Germany (23 percent), UK (22 percent), Spain (19 percent) and Ireland (11 percent). After all, there are plenty of tarnished financial institutions whose names readily trip off the tongue: Barclays, Lehmann, Goldman Sachs, RBS, UBS

The majority belief – 59 percent – underpinning such widespread lack of trust is that the causes of the banking scandals we’ve seen on TV news day after day are internal and within the control of each firm, with the single largest belief held by 25 percent of those surveyed believing the causes to be corporate corruption.

Trust Deficit in Banks

It seems clear to me that loss of trust in these institutions has come about largely by perceived bad behaviour (actual bad behaviour in many cases) of leaders and other employees of influence and seniority in those institutions. Their behaviours, and the cultures that have been sustained by them, have sullied the reputations of their firms.

Edelman’s report shows that trust in banks and financial services reached their lowest point in the US in 2011 and in the UK, France and Germany in 2012. With trust in two-thirds of the markets below 50 percent, trust in banks, globally, is now 11 points lower than it was in 2008, the year of the global financial meltdown.

Flipping the sector perspective, there are many positive aspects to note in this report, such as:

  • Technology (77 percent) and automotive (69 percent) were again the two most trusted industry sectors.
  • NGOs remain the most trusted institution posting trust levels above 50 percent in 23 of 26 countries – four of the five top markets are in Asia (China 81 percent, Malaysia 76 percent, Hong Kong 76 percent, Singapore 75 percent).
  • Further dimensionalization helped media continue its rise in trust that began in 2010. Among the general population, mainstream media and online search (both at 58 percent) 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 percent) are more than twice as trusting as developed (26 percent).
  • 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.

There is much rich reading to absorb in this 2013 Trust Barometer, all of it leading to a conclusion that is very much a clear call to action:

[…] Business must also change the way it engages stakeholders. We are in an era of skepticism; people need to see or hear something three to five times in different places before believing it, and learn equally from traditional and social channels. The traditional pyramid of authority, with elites driving communications top down to mass audiences, is now joined by an inverted pyramid of community – employees, action consumers and social activists involved in real-time, horizontal, constant peer-to-peer dialogue resulting in a new diamond of influence. Smart institutions will use vertical one-way communications while continually participating in the ongoing horizontal conversation.

Edelman call this approach “Inclusive Management”, illustrated by “The Diamond of Influence.”

The Diamond of Influence

I like the idea of a “license to lead” as a label for leader behaviour, evolved from the simpler “license to operate.” The former is much more attuned to contemporary behaviour and expectations where the participatory and collaborative nature of leadership derives from the consent of those being led.

It’s a big concept – and very much an important element in the broad concept of a social business and the interlinked disciplines of leadership and communication as suggested in the new communications framework proposed by the Arthur W. Page Society last year.

Plenty to think about. More importantly, do something about.

Discover more from the 2013 Edelman Trust Barometer.

Related posts:

HP’s new OfficeJet Pro 8500 on trial

hpofficejet How cost effective is your printer in terms of consumables like paper and ink or toner? Does it use a lot of electricity to run? Is it environmentally friendly in terms of manufacture, day-to-day operation and ultimate disposal?

These are probably not questions at the front of your mind each time you send an email or Word doc to the printer to get a hard copy.

They’re not usually the prime things I think about when printing – although cost is increasingly a thought especially whenever I have to replace expensive ink cartridges – but I’m going to find out if a new printer, an HP OfficeJet 8500 Wireless, will provide convincing answers to questions like these.

Along with answers to more fundamental questions like how good is the print quality, how fast does it print, what about scanning, etc.

I set up and installed the printer in my home office yesterday; here’s an Animoto video story of that experience.

All the photos you see in the video are also on Flickr. I also posted a couple of ipadio audio comments here and here as well as an Audioboo of the sound of the printer calibrating itself (close your eyes, listen, and imagine). This printer is quite a machine. Setup took about 90 minutes in total, from unpacking the box, putting everything together, setting it up on my network and getting it to work with my desktop PC running Windows Vista. Very easy and straightforward, a question really of following some simple instructions and running some wizards on the PC as well as on the printer. I have the HP OfficeJet Pro 8500 Wireless (that’s quite a mouthful) until the end of June as part of a trial HP’s PR agency Edelman is conducting with a number of bloggers in the UK:

HP’s big focus at the moment is on designing printers that cost less to run and are kinder to the environment.  [..l.] Please use the printer as you normally would and keep a track of daily paper usage with the tracker provided. We are aiming to calculate how much money can be saved when printing with the HP OfficeJet printer compared to other laser printers of a similar pricing.

Meanwhile, my Epson Stylus DX6000 printer is consigned to a cupboard, there to sit for the duration of this trial. I’m under no obligation to Edelman or HP to write or say anything about the printer, by the way, or post pics to Flickr, do videos, etc. But what’s the point of having it to trial if I don’t do such things? Where’s the fun? So reviews to come on my tech blog.

Checking out Norton Internet Security

Finally I’ve had some time to set up a software app on my desktop PC to test it out and see what I think of it.

The product is Norton Internet Security 2009 and I have a copy courtesy of Jason Mical and Tom Howells of Edelman and SpookMedia respectively.

I’ve now installed it; the Flickr slide show above includes the screenshots I grabbed, some of which I plan to include in the first review I’ll write about the app soon, over on my tech blog.

I’ve used many Norton products over the years, from Norton Utilities for DOS and Norton Commander for DOS way back in the 80s to Norton Internet Security suites in recent years. The most recent Norton product I’ve used was a 3-PC license for Norton 360 when it first came out.

(Incidentally, there’s a worthy successor to that brilliant Norton Commander for DOS that I’ve been using for nigh on 15 years: Total Commander for Windows.)

I’ve had a love-hate relationship with Norton over the years – and spent not insignificant sums of money buying subscription services – which ultimately resulted in my switching to the McAfee Security Center a year ago.

But I have an open mind about products like this, ones that you don’t think much about yet are important first lines of defence on your computer against the bad guys out there.

There are other such products but I don’t have much interest in considering those – you can find plenty of comparison reviews like this one if you want to make your own comparisons.

So I’ll be checking out the latest Norton offering from Symantec. Who knows, I may come back to Norton on all my PCs.

Truth and consequences about trust

On the basis that a picture is worth a thousand words, the chart below speaks loudly and clearly about the decline in trust in businesses that’s practically uniform in almost all the 20 countries included in the Edelman 2009 Trust Barometer survey of trust and credibility in business and government, published yesterday.

companieslesstrusted

It illustrates the answer by those surveyed to this simple questions:

Thinking about everything you have read, seen, or heard about business in the last year, in general, do you trust corporations a lot less, a little less, the same, a little more, or a lot more than you did at the same time last year?

It’s a bleak-looking picture especially in 10 countries – that’s half those surveyed – where at least two-thirds of people say their trust in business has diminished a lot. The number is alarming-looking in Ireland (83%), Japan (79%) and USA (77%).

The average across the 20 countries: 62% of people – nearly two thirds – trust business less.

What about trust in government? How has that fared in 2008?

businessstillmoretrusted

Not particularly good, especially when compared to trust in business which, as you saw in the previous chart, declined dramatically last year in nearly all the countries surveyed.

Given the current global economic and financial crisis, should such decline in trust be any surprise at all? Even the alarming-looking percentages?

In my view, the most important question is: What do we do about declines in trust? It’s almost but not a Royal We: every one of us has the power to do something to address the decline in trust.

I’m going to say two words: engagement and conversation.

That means more identifying and connecting directly with individuals instead of the (easier) mass communication typified by most advertising, marketing and other organizational communication.

Social media can be such an effective means to engage and converse. Markets are conversations, remember.

As communicators, are we up to it? Can we recognize the truth behind declining trust? Edelman’s latest research gives us some compelling sign posts.

The 2009 Trust Barometer is Edelman’s 10th annual report on trust, the interpretation of the results of research conducted in telephone interviews during December 2008 among a sampling of 25 to 64 year olds (what Edelman calls “informed publics”) in 20 countries. It was presented yesterday at a press event at Edelman’s London office.

You can download a variety of PDFs from Edelman’s website including Richard Edelman’s presentation (from which the charts above come), the transcript of the speech given by Joe Garner, General Manager UK Personal Financial Services at HSBC Bank, as well as an executive summary and press release texts.

[Later] Edelman has a new page on their corporate website that aggregates news reporting and blog commentary about the Trust Barometer as well as video footage of Richard Edelman giving his presentation – http://www.edelman.com/trust/2009/.

There’s a neat quiz on that site: Trust Your Instincts.

trustyourinstincts

Tip: for a high score, either know your subject matter very well indeed, or read the 2009 Trust Barometer before you take it. :)

Yesterday marked my first visit to Edelman’s spiffy new offices in London’s Victoria, where all Edelman’s UK operations are now housed under one roof. The room where the presentation took place was expectedly hi-tech with good visibility on the various flat-panel display screens from wherever you were in the crowded room.

27-01-2009-16-20-24-sm Two of those panels showed a live Twitter stream of comments and opinion from people in the room using the tag #etb09.

That very quickly spread to comments by others elsewhere who weighed in with their thoughts, based on what others at the event were saying as well as being able to access the content online, all of which is fully trackable with simple tools like Twitter search as long as everyone used the #etb09 tag. (The display of tweets came via live.edelman.co.uk, a tool I’d love to know more about.)

Engaging and conversing: a small example of one way, and so easy to do.

Something to expect more of at live events.