17 Sep 2021
Profiting from trust: the expanding role of the CEO in the post-pandemic age
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Post-pandemic, trust is more precious than ever, and people are increasingly looking to senior business leaders to act well beyond the pursuit of profit.
In times of turbulence and volatility, trust is what holds our society together. It’s also the basis for how we rebound and regrow our world. Every one of our institutions has a part to play in this, and business is no exception.
This creates some specific challenges for business leaders to address as we move into more of a post-lockdown environment.
But what is the current state of trust, globally and, more specifically, in Germany? Every year, Edelman does a survey of trust in governments, businesses, the media and non-governmental organizations (NGOs), conducted for the 21st time this year.
High expectations of business
The global picture shows a fairly widespread collapse in trust in governments, government, NGOs and media, but a relatively stronger showing for business. Business is not only the most trusted institution among the four studied, but it is also the only trusted institution with a 61% trust level globally, and the only institution seen as both ethical and competent.
“When the government is absent, people clearly expect business to step in and fill the void, and the high expectations of business to address and solve today’s challenges has never been more apparent.”
The heightened expectations of business bring CEOs new demands to focus on societal engagement with the same rigor, thoughtfulness, and energy used to deliver on profits,” the report points out.
What is the trust picture for Germany?
Well, in the global trust ranking of the general public, Germany ranks 14th out of 27 markets.
Surveyed Germans regard their social institutions in the neutral range of trust, but the government is seen as the most trustworthy institution in Germany (59%), followed close behind by companies (54%). Most trusted are, unsurprisingly, scientists (71%), and then ‘people from my local environment’ (58%). And ‘my employer CEO’ (54%).
Misinformation remains a fundamental challenge, and the media are facing a clear question of trust.
59% of Germans (global: 61%) feel that the media does not do a good job when it comes to objective and non-partisan reporting, with a growing suspicion that journalists and reporters deliberately want to mislead people with incorrect and exaggerated information. Despite this, in terms of trust, journalists are still ahead of CEOs in general.
German CEOs are expected to step up
The public’s expectations of CEOs are indeed higher than ever. When asked, 68% of the Germans surveyed look to CEOs to act when the government cannot find answers to societal challenges. Significantly, 58% believe that CEOs themselves should be accountable not only to shareholders and board members as usual, but also to the wider public.
Finally, 57% say CEOs should be the ones to take the lead in change, rather than simply waiting for the government to initiate that change.
Amongst those new expectations, there are some very particular areas of focus. The quality and veracity of information is one that shines out. It must be reliable and trustworthy
In fact, so important is this one issue, that, globally, more than half of respondents believe that when the news media is absent, they will look to corporations to step up and fill the information void.
Vital components of trust
How you build trust as a leader can perhaps be boiled down to three key components:
The first is competence. This means showing your colleagues that you know what you are doing. That includes demonstrating that you are capable of understanding what the other person needs or might need. So, listening is key, letting others talk too, and hearing what they say.
Competence also means admitting what you don’t know, having the honesty and humility to never claim to ‘know it all’. We all recognise that in this complex and complicated world nobody can really claim to be on top of absolutely everything all the time.
Integrity is next. Doing what you promise. If you make a decision or a promise, stick to it.
Of course, situations and circumstances change, and sometimes that will affect the decisions made, but everyone will understand if that is acknowledged and explained clearly. If you intend to change anything agreed upon, explain what’s changing, why it’s changing and how it’s going to change.
The final point is about letting others know that you are not acting only in your own interests, but that you truly care about what the other person. It’s a real acknowledgement of their concerns, goals, ambitions, pain points, and so on. Trust is always a two-way street.
All three components must be present if a leader is to be seen as a trust creator. Michael Proft points out:
“Great leaders are those who treat everyone in their organisation, from the lowest level to the highest, with respect.”
“Simply being excellent at the professional aspects of your job won’t buy you any trust, you have to demonstrating the traits of integrity, empathy, honesty and a genuine regard for others is what will set you apart”, adds Marco Henry V. Neumueller.
Top down, trust up
Any culture of trust needs to be set at the top. The CEO and the senior leadership helps to establish the right tone for the organization in the way they treat each other, and the organization they lead.
Increased communication and transparency between leaders and employees is important, with open discussions on companywide decisions, goals and projects, always with plenty of time for questions and answers.
Trust drives engagement
Building trust in this way can only have a positive effect on employee engagement. If employees feel trusted, they feel more engaged. And as research shows, that can mean 50% higher productivity, less absenteeism, and a lower turnover of talent.
Ultimately, companies with higher trust levels outperform those with low levels by as much as 186%, according to Gallup.
A leader who consciously sets out to build trust with, and between others, demonstrates a commitment to the greater good. These are the leaders who will be remembered long after they move on. They are the leaders that create a sustained impact because others will be eager to build on their legacies and emulate their leadership style.