Nearly four years since the global economic meltdown began, the nation’s financial services and banking industries remain among the least trusted by consumers, according to the latest annual global survey of trust conducted by Edelman.
Despite an improvement in the economy, the industry has yet to recover from an international backlash by publics who largely blamed financial institutions for the world’s economic woes. Less than half of respondents (46 percent) trust financial services and only 41 percent of respondents trust banks, although both experienced a significant uptick in trust from last year, when they bottomed out at 25 percent.
“While trust in every industry declined in 2008 after the global economic crisis, financial institutions and auto companies were particularly hard hit,” said Matthew Harrington, US president and CEO, Edelman. “Since then, an industry-wide commitment to producing high-quality products and communicating openly and honestly with customers has lifted auto companies out of the global trust doldrums, but financial institutions still have a long way to go to regain the level of trust enjoyed prior to the financial meltdown.”
Edelman’s survey indicates that societal attributes of financial institutions played a more dominant role than operations when it comes to rebuilding trust. Respondents ranked “has ethical business practices” (76 percent), “listens to customer needs and feedback” (74 percent), and “places customers ahead of profits” (73 percent) as the most important actions financial firms should take to rebuild trust.
From an operational perspective, respondents indicated “communicates frequently and honestly on the state of its business” (69 percent), “offers high quality products or services” (66 percent), and “has transparent and open business practices” (65 percent) as the most important.
“Financial services firms and banks will rebuild trust through societal factors and stakeholder engagement, rather than operational characteristics,” adds Jeff Zilka, general manager, financial communications, Edelman. “Our survey highlights the need for principles-based leadership rather than rules-based performance. Equally important, consumers are eager to communicate with brands. Financial institutions will do well to listen to what their stakeholders are saying and act on those key learnings.”
The survey revealed that those who distrust financial services and banks are less than half as likely as those who trust these institutions to believe corporate sources of information (31 percent vs. 77 percent). Rather, more than two-thirds (67 percent) of industry distrusters will believe company information reported in traditional media and 64 percent will trust multiple online sources. “To start a valuable dialogue with stakeholders, financial services companies and banks need to ensure that what they want heard is accessible beyond their own website,” Zilka said. “This means engaging with the press and participating in social media.”
Respondents who said they trusted financial services and banks indicated that “a technical expert in the company” was the most credible company spokesperson (80 percent), while industry distrusters consider “a person like yourself” to be the most credible (68 percent).