The narrative is shifting – it’s now time to rekindle trust in business

 
Rachel Bower
GERMANY-G20-SUMMIT
Trust in business in general is higher than trust in government or the media (Source: Getty)

As business leaders face fire on everything from executive pay to labour standards and tax avoidance, the temptation can be to hunker down and keep out of the fray.

It is only natural to want to avoid high-profile debate for fear of criticism.

The problem is that managed retreat is not a strategy for rebuilding trust in business, or, for that matter, its leaders. Instead, business must demand recognition for the role it plays in tackling the issues that genuinely matter to the public, not just those of concern to investors and shareholders.

Read more: A manifesto for the City of London’s future

When you are at the centre of a media storm, it can feel like that kind of effort is impossible. However, this year’s Edelman Trust Barometer shows that business has real potential to make a difference, provided it communicates. The task is to pick your timing and message.

If we had once had enough of experts, we are now starting to give them another chance. The UK data shows trust in chief executives and boards is up significantly (by 14 points and 10 points respectively).

Trust in business in general is higher than trust in government or the media, and nearly on par with trust in NGOs. Further, in 10 of the 28 countries we surveyed, business is the most trusted institution.

Corporate leaders have a platform to lead the conversation about what kind of society and economy we want. They also have a responsibility to do so.

Some 60 per cent of the public expect chief executives to lead on change rather than wait for regulators to impose it. The dangers of trying to ride out public concern are clear when you look at how regulatory threats have caught up with public discontent in sectors such as energy , financial services, or the gig economy.

The Edelman survey shows that more than a third of people think their standard of living will get worse this year, while only a fifth expect it will improve – with Londoners the brightest about their personal prospects.

When campaigners and charities rightly complain about inequality, they are communicating a very real worry, shared by 40 per cent of the population who say it is a top concern.

It is therefore not surprising that the most commonly cited barriers to trusting business are overpaid executives (58 per cent), failure to pay the appropriate levels of corporation and personal tax (56 per cent), and lack of transparency in business dealings (45 per cent).

Successful corporate leaders recognise these challenges, and appreciate the ways their business can be seen as contributing to them. This is a perception they need to tackle head-on. Early, bold statements of ambition and values can be risky, but inaction can be riskier still.

Business leaders also need to be smart about the channels they use to communicate.

The last year has seen a turn away from social media, while the share of the population who simply avoid news has increased, with well-educated, urban populations most likely to skip traditional news altogether.

If you want a message to reach someone, one of the most powerful ways to communicate it is through employees (who are seen as highly credible sources by 50 per cent of Brits).

As leaders of major businesses, it is easy to be accidentally sucked into a social and media world that creates a vacuum, separating corporate leaders from their front-line staff and consumers. This year’s Trust Barometer shows the danger of doing so, but also the power of intentionally engaging with the issues people care about.

There is a huge opportunity for business to communicate its own value in a way that includes, but goes beyond, value for money of products and services.

It is vital that corporate leaders seize the chance to build on growing trust and continue to change the narrative about business in Britain.

Read more: Capitalism needs a makeover – and employee ownership can help

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.

Related articles