Corporate leaders have a big problem. Almost 1 in 3 employees don’t trust their employers, according to the 2016 Edelman Trust Barometer, a survey of 33,000 individuals in 28 countries.
Gone are the days when leaders spoke from on high and employees blithely followed.
In fact, the survey results show that “the lower you go in the organization, the less trusting people are,” says Christopher Hannegan, executive vice president and lead of Edelman’s U.S. employee engagement business.
While 64 percent of executives trust the company they work for, only 51 percent of managers and 48 percent of rank-and-file employees share such faith, according to the survey results.
The farther that workers are from senior leaders, the less connected they feel to the company’s strategy and the less they understand what their role is and how they can contribute. “That can breed skepticism and disconnection from an organization,” Hannegan explains.
Rising income inequality and high-profile corporate scandals have driven a wedge between elite top-earners and everyone else. Moreover, social media platforms give people a megaphone with which to air their trust issues, Hannegan says. The survey shows a significant gap: College-educated individuals with higher incomes are far more trusting than the general population. In the U.S., 71 percent of high-income residents trust institutions (government, business, media and nongovernmental organizations), while only 40 percent of low-income respondents had such confidence. Hannegan believes that a lack of trust explains the voter rebellion fueling Donald Trump’s anti-establishment presidential campaign.
The survey identified gaps between attributes that employees believe are important for building trust and how leaders are actually performing against those attributes.
For example, while 50 percent stated that it is important for CEOs to exhibit highly ethical behavior, just 24 percent believed their own CEO actually does so. Employees also see a need for CEOs to improve trust by behaving in a transparent manner, treating employees well, and taking responsible actions to address issues or crises.
For executives who don’t take this whole “trust” thing seriously, consider the numerous studies—including those by Trust Across America and the Great Place To Work Institute—that have found that high-trust organizations achieve better financial performance.
In addition, an absence of trust can negatively affect staff engagement, morale, retention and recruitment, says John Blakey, author of The Trusted Executive (Kogan Page, 2016). It can also harm a company’s long-term reputation.
Building trust is a bit more complicated than it may sound. Leaders must be able to get things done—that’s a given. But to earn trust, they also need integrity, which means living up to the standards they set for the organization and exhibiting honesty, openness and fairness.
And an additional component, benevolence, is also necessary to establishing trust, according to Blakey, citing University of Florida research. That involves showing compassion and kindness without commercial motive.
“That’s probably the most challenging for a lot of leaders who have been brought up with the mindset of being strong and ruthless and driven,” Blakey says.
While there’s certainly a call for change, it won’t happen quickly in most organizations.
“We are changing our expectations of leadership but, in the process, there’s a bit of a battle going on. We’re seeing the old style trying to assert itself aggressively,” he says.
HR professionals can help by creating greater awareness of the issue. Blakey envisions a time in the near future when organizations will measure trustworthiness as they now assess engagement. Such a metric would give companies an advance warning system for problems.
Undoubtedly, business leaders will need some motivation to change.
“If the old model of leadership becomes paralyzed, then I think leaders will learn these new habits,” he says. “The trick is to learn them quicker than everyone else.”