For 22 years, Edelman has conducted a global survey on trust and its role within business, governments, NGOs, the media, and their stakeholders. This year’s survey represents 28 countries and over 36,000 respondents across sectors and industries, and the findings have inspired Edelman to coin 2022 ‘The Cycle of Distrust’.
Interestingly, however, that distrust falls squarely on government and media, with 1 out of 2 respondents viewing government and media as divisive forces in society. So, who can be trusted? Apparently, business. Of all institutions, business was ranked the most trusted by respondents for the second year in a row in the wake of disappointing COVID-19 responses by many governments around the world.
But with that trust comes responsibility.
This year’s Trust Barometer saw an increased expectation on business to lead in addressing societal problems as fewer people trust their government to do so. Despite those expectations, most people reported that businesses weren’t yet doing enough to address societal problems such as climate change, economic inequality, and workforce reskilling.
“Every stakeholder group expects business to lean in—nearly 60 percent of consumers now buy brands based on beliefs while 6 in 10 employees choose a workplace based on shared values and expect their CEO to take a stand on societal issues,” notes Richard Edelman along with the findings of the survey.
Palladium CEO Christopher Hirst agrees and adds that especially when it comes to climate change, rather than governments leading the charge, ”the answer lies with the twin powers of finance and consumption, and their ability to engage with and support organisations that are setting and meeting aggressive net zero targets.”
This is in a stark contrast to BlackRock CEO Larry Fink’s recent annual letter in which he calls on governments to step up in driving societal change, especially around sustainability measures. “We need governments to provide clear pathways and a consistent taxonomy for sustainability policy, regulation, and disclosure across markets,” Fink asserts.
So, does the right answer lie with who consumers and the public trust? Richard Edelman seems to think so, but with the hope that eventually government and business will operate at the same level. “Business must walk a tightrope,” adds Edelman. “For now, business must accept the burden of filling the void left by government, but it should be poised to pivot to a more level playing field.”
The answer may be somewhere in the middle, with partnerships across these sectors. Hirst adds that the power of partnerships will be key for progress across societal goals. “There are already numerous examples emerging of partnerships finding new and innovative ways to finance the restoration of nature and value carbon in a way that makes it an attractive investment.”
Palladium’s Managing Director Chris Lee agrees that despite differing incentives, partnerships and cooperation are the way forward. “Each of these actors have to be operating in tandem in order for progress to be made,” he explains. “People trust institutions for different reasons, purposes, and expectations but for me, it’s about how these different actors work together towards a common positive outcome – the betterment of the people they’re trying to serve.”
But Lee notes that no matter the sector or industry, business or government, they need to listen to their stakeholders. “Every institution has a reputation based on whether people are willing to trust them, and that’s not new. Though the tastes in what people are choosing to ask of those institutions are changing, the onus is still on them to respond if they want to exist, whether they’re government or business.”
Perhaps the most important takeaway is that every stakeholder, from customer to shareholder and beyond, will be holding business to account over the next year and expecting leadership at a time when many people are unsure of where to turn.
And while the threat of greater oversight should never be reason for an organisation to shift towards more sustainable practices, taking a leadership role in ‘building back better’ and bringing together sectors in partnerships and collaboration could be a good place to start.
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