The business case for trust is indisputable. As the chart below shows, for the past eleven years our Trust 200 Index, a diversified mix of the most trustworthy public companies has handsomely rewarded those who chose trust as a strategic imperative. This includes business leaders and their stakeholders, and also investors. Yet we seem to be stuck in a trust free fall across most societal institutions. Why is that?
It’s certainly not due to lack of interest in the subject of trust nor a shortage of those attempting to monetize trust. In fact, 2022 may have been a banner year for new trust initiatives. Many of the large advisory firms have boarded the trust train, yet their initiatives continue to skirt the two key challenges of trust building. What are they?
The Leadership Challenge
Trust is not a soft skill: Most leaders remain risk focused never considering trust until a crisis. Do you know why?
- They have never thought about the role trust plays in organizational success.
- They have been taught to always defer to legal and compliance, who have no trust or other mistakenly termed “soft skill” expertise.
- They would rather not think about the long term reputation costs associated with a crisis until they are faced with one.
Leaders must own trust: Until leaders are encouraged to acknowledge that the trust “buck” stops on their desk, any and every trust workaround initiative will fail over time. In the short term these programs may provide some good publicity opportunities but they are not sustainable.
Trust requires cleaning your own house first: In every organization trust is built from the inside out, over time and in incremental steps, and it must always begin with trustworthy leaders. “Talking” trust and acting on it are not the same. In fact, when a leader is seen talking trust, think about whether his/her every day actions match their words. In almost every case they do not.
The fix: It begins with leadership acknowledgement of trust as an organizational imperative, an enormous hurdle, followed by identification of the internal behaviors that are weakening trust, and finally by the willingness to allocate resources to mend the behavioral breaks.