Trust in American Business is Eroding, Says Study

Trust in American business is eroding across numerous business sectors according to a new Trust survey conducted by Golin/Harris International. By a margin of seven to one, survey respondents told the international public relations firms that “recent economic events have created a crisis of confidence and trust in the way we do business in America,” and as a result, they’re “going to hold business to a higher standard in their behavior and communications.”

“When more than two-thirds of Americans express this level of skepticism and cynicism, American business has a serious problem that goes beyond the ‘Enron factor,’” says Richard Jernstedt, the firm’s chief executive. “Obviously, the current wave of scandals has a direct impact on specific industries, but when you look at trust levels across the entire spectrum of American business, almost every category is affected. The malaise of trust is becoming epidemic, and no business can escape by saying ‘it’s not my problem.’”

Trust is lowest for companies in the oil and gas industry (-63 on Golin’s “Trust Index), followed by insurance (-59), Wall Street (-58), airlines (-52), accounting (-48), chemicals (-43), telecommunications (-42), and advertising and marketing (-41). Journalism didn’t score much better, with a rating of –38. In fact public relations (-31) had a higher trust score than journalism.

The survey is designed to identify and compare both the degree and direction of trust across more than 25 different business sectors and express it in a single number. A positive score indicates a strong trust profile, while a negative index number signals trust challenges that should be addressed immediately, conscientiously and consistently.

Those businesses with positive trust scores included groceries and supermarkets (40), major retail chains (36), drug stores (9), computer hardware and software (8), and health and beauty (8).

American business needs to mount a “trust offensive,” says Ellen Ryan Mardiks, worldwide director of marketing and brand strategy. “While the situation is clearly serious, it is not gloom and doom beyond repair. Rather, we see some very clear and compelling opportunities and strategies for businesses to build and strengthen trust in their brands.”

When Golin asked what companies could do to win back their trust, there were several suggestions:

Be open and honest in business practices (94 percent)
Communicate more clearly, effectively and straightforwardly (93 percent)
Provide the best value in products and services (88 percent)
Visibly demonstrate concern and consideration for employees (83 percent)
Provide outstanding products and services regardless of price (72 percent)
Do a better job understanding and addressing my needs (65 percent)
Demonstrate and communicate industry leadership (65 percent)
Change the way the company communicates financial activities (61 percent)
Be innovative and different from the competition (56 percent)
Make the CEO a spokesperson beyond reproach (50 percent)
Make Board of Directors more hands-on and involved day-to-day (50 percent)
Be involved with the community (50 percent)

“Every company can and should implement these activities,” noted Mardiks. “‘Promises made plus promises kept equals a trusted brand’ is the equation every business must use to guide what they do and what they say. And, trust must be earned not just once, but always. As the list suggests, ‘reliability over time’ is the one constant that underscores every trusted company and brand.”

The survey underscored recent research suggesting the CEO needs to take a leadership role in building trust. The survey asked Americans to tell CEOs what qualities of leadership they want so the CEO can continue earning their trust. The five leadership qualities named as most important included: