Each January, the global public relations firm Edelman releases its Trust Barometer based on extensive surveys on attitudes toward businesses governments, non-governmental organizations, and the media. The good news from a Higher Ambition perspective is that 75% of those surveyed agree that “a company should take specific actions that both increases profits and improve the economic and social conditions in the community where it operates.”
The bad news is businesses are on the brink of distrust. A majority of people surveyed worry about losing their jobs because of automation and globalization. The Edelman survey found that employees—not executives—were the most credible sources on the topics of how a company treats its workers, earnings and operational performance and its role in the community. Rosy statements in the annual report not backed by consistent actions will quickly be unmasked.
What are executives to do? Edelman advises that the first step is “do no harm”: don’t pay bribes, pay executives “hundreds of times more than workers,” off-shore profits to avoid targets, overcharge on essential products, or lower product quality to reduce costs. The second step is to build trust by treating employees well.
Additionally, the Edelman findings encourage a company to engage with stakeholders such that the organization is working with people, rather than offering or doing things for people. This is a fundamental shift in thinking and practice—though not one foreign to higher ambition leaders. It means engaging stakeholders as equal partners in success and seeing the benefits acknowledging their legitimate interests as contributing to achievement that serves all.
The survey results present both challenges and opportunities for higher ambition companies. The expressed belief that companies can create both financial and social value aligns with the strategies of higher ambition companies. However, it sets a high bar. We need to be more committed than ever to be positive examples of how companies can do better. Each of our members has shown it is possible to meet and exceed the expectations of investors as well as employees, customers, and communities. The Edelman survey is a call to action; one we’re happy to embrace.