Davos Looks at Trust

2010's worst events, from Toyota's widespread product safety problems to the failure of the Deepwater Horizon, reinforce the notion that companies that don't get the basics right have no chance of earning public trust.
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My time at Davos began on an early morning panel at the launch of Edelman's 2011 Trust Barometer, an event that's become a staple at Davos.

Unlike recent years, when the crisis led to steep falls in trust for nearly all sectors, this year's results are more mixed: some ups and some downs. A couple of key messages stand out.

First, trust in business has stabilized after the crisis. Despite some high profile corporate travails -- think BP, Toyota -- in 2010, faith in business overall has come back after the depths of the recession.

Second, general trust levels in the United States are abysmal. Edelman calls the broad drop in trust of American institutions the "stark exception" to more positive readings in other parts of the world. Americans have lost their sense of trust in all four sectors Edelman measured: government, business, media, and NGOs. This no doubt reflects ongoing economic sluggishness, particularly high unemployment, and even more, the sharply polarized political environment, which has soured the public.

Third, trust in the media is at an all-time low, especially in the United States and the U.K. Richard Edelman, his namesake firm's CEO, attributed this to the sharp tones in both countries' media, as well as the rise of social media that have undercut the monopoly held by more traditional outlets.

What are the lessons for business in all this?

2010's worst events, from Toyota's widespread product safety problems to the failure of the Deepwater Horizon in the Gulf of Mexico, reinforce the notion that companies that don't get the basics right have no chance of earning public trust.

But equally -- and less obviously -- important is that just getting the basics right won't earn the public's trust either. The future -- and the highest degree of trust -- will be won by companies who tackle big global challenges as part of their business strategies. Recent announcements from Walmart on reducing food waste, from GE on expanding Ecomagination, and from Unilever on its Sustainable Living Plan are great examples of companies saying, "Your challenges are our challenges."

At the end of the day, businesses that deliver something that goes beyond profit are most likely to earn the trust they are seeking.

The theme for this year's Davos is "Shared Norms for the New Reality." If purposeful business becomes one of those norms, trust levels -- and human well-being -- will both rise in the years ahead.

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