The importance of fostering trust

When corporate leadership and their boards choose to ignore trust as an intentional business strategy, the fallout for all stakeholders can be swift and painful.  John Stumpf at Wells Fargo and Heather Bresch at Mylan would be hard pressed to disagree. And more recently, many assert that the deciding factor in our Presidential campaign and election was “trust.”

We recently asked our global Trust Alliance members to weigh in on the following question:

Do you think most business leaders are proactive or reactive in building trust and why?

Bob Vanourek speaks from decades of experience, feeling that unfortunately, most business leaders are neither proactive nor reactive in building trust.

Sadly, I think they don’t think about trust, nor how important it is to building their business successfully. If my opinion is accurate, it makes our work at Trust Across America – Trust Around the World so essential.

My opinion is based on 30 years in business in eight different industries around the world. I was fortunate to be the CEO of five companies, and I have served on 10 different boards. During my career, I engaged the services of well-known consulting firms and served on committees in industry trade associations.

Why recount this history? Because during those years, I never heard the word “trust” discussed as a business imperative. Never. Colleagues may have mentioned trust in passing as we discussed other issues, but it was never recognized as a major leverage point for our business success.

What did we discuss? Strategy, tactics, budgets, cost reductions, shareholder value, efficiency, innovation, new products, organization structure, policies, procedures, controls, customer satisfaction, quality improvement, differentiation, acquisitions, financial engineering, hiring, staffing, turnover, retention, marketing programs and sales efforts. As we became more sophisticated in what really mattered, we began to focus on concepts like culture, values, vision, empowerment, training and development, emotional intelligence and creating value for all stakeholders.

As you can tell from these long lists, we were frantically busy. But we never made the connection with the essential element of trust to our business success. Trust with customers, employees, business partners and suppliers, the communities we touched and our shareholder owners. We missed the boat. I missed the boat.

Don’t miss the boat. Put building trust proactively on your daily agenda. Keep this question top of mind every day: “What can I do in this situation to build trust?”

Nadine Hack wishes more business leaders were proactive in building trust, but has found that many only think about trust issues after there has been a serious breach.

This can occur externally, as when Volkswagen had dealt with the aftermath of software that “lowered” diesel emissions or when Wells Fargo leadership encouraged false accounts.

It can happen internally, as well; Gallup polls show that employee engagement is at only 32 percent, with another 17.2 percent “actively disengaged.”  Trends show that among Millennials, these numbers will become more dramatic.  There’s been endless talk with catch phrases like “compassionate leadership,” bantered about, but little action taken.

But we have some leaders like Howard Schultz, CEO of Starbucks, who asks his executives to speak up when they don’t agree.  He embodies my thesis that it’s vital to listen to your stakeholders’ input, believing they will have valuable insights, possibly even better than yours.  I call this Strategic Relational Engagement™.

Similarly, Elizabeth Doty finds most leaders want to be trusted and hold themselves to a high bar, but generally do not take active steps to build trust until there is a crisis. Unfortunately, this can lead to unnecessary distrust in relationships with employees, customers, peers, superiors and the public.

In talking with these executives, a combination of external pressures and internal mindsets contribute. Nowadays, leaders struggle to make time for strategic priorities of any kind, so investing in relationships often falls to the bottom of their list. In addition, well-meaning executives tend to assume actions alone will convey their good intent, not realizing that a) prior experiences color how people interpret their actions and b) everyone occasionally violates their values, which can lead to distrust unless leaders actively create safe places for discussion. Also, leaders underestimate the risks and uncertainties others face in deciding whether to trust. Simply put, people need to know where they stand. This is where open, two-way dialogue can help them identify the specific commitments and assurances people need to be able to trust and engage.

And finally, Bob Whipple believes most business leaders ARE proactive with their desire to obtain trust. It’s the execution that often falls short.

They talk about it frequently and try to plot ways to increase it. A large percentage of leaders have trust as one of the core values of the organization.  I believe most of them understand the leverage that is available.  What astounds me is that it is rare to find a leader who recognizes his or her contribution to why trust is so low in the organization to begin with.  Leaders shoot themselves in the foot on trust daily, and yet they have a deep desire to increase trust.

Contrary to popular belief, corporate integrity is not just about meeting shareholder expectations. It is a hard and measurable asset that must consider the needs of ALL internal and external stakeholders. Leaders who embrace building trustworthy or high integrity organizations encounter fewer crises and are also more profitable. Trust Across America has recently released a white paper called The State of Trust in Corporate America 2016 that can be accessed by registering at this link, for those readers interested in a more in depth review of this important and timely leadership imperative.

Barbara Brooks Kimmel

Barbara Brooks KimmelBarbara Brooks Kimmel is the CEO and Co-Founder of Trust Across America-Trust Around the World whose mission is to help organizations build trust. Now in its sixth year, the program’s proprietary FACTS® Framework ranks and measures the trustworthiness of over 2,000 U.S. public companies on five quantitative indicators of trust. Barbara is also the editor of the award-winning TRUST INC. book series and a Managing Member at FACTS® Asset Management, a New Jersey registered investment advisor.

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