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State of Trust in Australian Enterprise: Businesses Need to Lead Change

Last month the 2018 Edelman Trust Barometer revealed that 74% of Australians trust the businesses that they work for, an increase of 20 points from the previous year. In addition, 64% of those surveyed say that CEOs should take the lead on change rather than waiting for government to impose it, while 69% say that building a trusted company should be top priority for CEOs.

This signals that enterprise must take more concrete steps in making positive changes in the country, an important conclusion from the annual global survey which expressed concern for “a world of seemingly stagnant distrust.”

Trust in businesses

The onus is on CEOs to become authorities on issues and policy, as 84% expect CEOs to inform conversations and policy debates on issues such as jobs, the economy, automation, regulations and globalisation. Business credibility on issues is high; people are as likely to believe major corporations as major news organisations.

Overall, trust has declined in all four Australian institutions (government, business, NGO and media), scoring 40 points in the Trust Index among the general population and 55 points among the informed public, which places Australia at the bottom half of the 28 markets in the survey.

Polarisation of trust

Media is the least trusted institution globally, but even more alarmingly, only 31% of Australians trust media in general, making it the second lowest among all countries polled. 7 in 10 Australians worry about fake news being used as a weapon, and 52% trust journalism vs 35% in platforms (social media, search engine results).

How Business Should Navigate a Polarised World

63% of respondents agree that while reputation can get them to try a product, unless they come to trust the company behind the product, they will soon stop buying it, regardless of its reputation. Trust-building mandates for business include:

  • Safeguarding privacy
  • Driving economic prosperity
  • Investing in jobs
  • Ensuring a competitive workforce
  • Promoting consumer safety

Business is the retaining wall

The annual global study’s State of Business findings further recommend that to navigate a polarised world, business should:

  1. Show commitment beyond the business;
  2. Address market dynamics and localise trust-building strategies;
  3. Speak up on key issues as credible experts;
  4. Inform and engage their customers through trusted voices such as peers and advocates; and
  5. Activate the entire organisation through conversation within the business and giving their workforce a voice.

Why Edelman Studies Trust

Excerpt from the 2018 Edelman Trust Barometer on why they study trust:

In modern society, we delegate important aspects of our well-being to the four institutions of business (economic well-being), government (national security and public policy), media (information and knowledge) and NGOs (social causes and issues).

In order to feel safe delegating important aspects of our lives and well-being to others, we need to trust them to act with integrity and with our best interests in mind. Trust, therefore, is at the heart of an individual’s relationship with an institution and, by association, its leadership.

If trust in these institutions diminishes, we begin to fear that we are no longer in safe, reliable hands. Without trust, the fabric of society can unravel to the detriment of all.

From an institutional standpoint, trust is a forward-looking metric. Unlike reputation, which is based on an organization’s historical behavior, trust is a predictor of whether stakeholders will find you credible in the future, will embrace new innovations you introduce and will enthusiastically support or defend you.

For these reasons, trust is a valuable asset for all institutions, and ongoing trust-building activities should be one of the most important strategic priorities for every organization.

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