Tip of the iceberg
We’re quite cognizant that customer trust is just one piece of the overall trust puzzle. This year’s CEO Survey provided some glimmers suggesting the broader implications of trust. For example, we saw that highly trusted companies are more likely to have made net-zero commitments and to have tied their CEO’s compensation to nonfinancial outcomes, such as employee engagement scores and gender diversity in the workforce.
It’s not yet clear which way the association runs. Still, the findings, which again were normalized by industry and confirmed for independence from demographic characteristics such as company location or size, seem important—a promising indicator that trust is an enabler of change and worthy of much deeper investigation.
We saw further intriguing evidence that customer trust is just the tip of the iceberg in a separate, recent research effort. We used machine learning analysis of a wide range of public media, as well as financial records, to identify a set of trust drivers and try to understand their relationship with financial performance.
Of the 17 trust drivers emerging from the analysis, the two that were most strongly correlated with growth in market capitalization pertained directly to customer trust: brand reputation and customer experience. However, a number of other factors, such as employee engagement, greenhouse gas–emissions initiatives, and corporate governance, also showed positive correlations. Patterns like these can help companies confirm what matters for them and prioritize key areas of competitive advantage.
In our experience, many companies struggle to find the appropriate balance of making the right public-facing commitments, taking reinforcing actions, and effectively communicating the key messages to stakeholders. Often, even those that do find the right balance struggle with what and how much to share, forgoing opportunities to outshine competitors that are less tuned in to the importance of trust and what drives perceptions about it.
Clearly, there is much to untangle. We’ve seen evidence in our work with clients that trust-related issues sometimes open up a gap between awareness of and affection for a company’s brand, a gap that can be a leading indicator of future performance problems. We’ve also seen that when companies furlough employees during hard times, instead of laying them off, they build trust and experience fewer disruptions to productivity. And we’ve seen trust play a role in big corporate change programs, acting as a shock absorber that maintains morale or energizing the organization as it tackles inspiring new goals.