Trust can be a confounding notion in the context of business. It can take years to build, but be destroyed in the blink of an eye. It’s at the heart of the sharing economy, the foundation of emerging business platforms and is fuelling the innovative ways blockchain and associated technologies are changing the face of trade.
5 years ago PwC’s CEO Survey found 34% of Australian CEOs were concerned about a lack of trust in business, a stark contrast to our most recent findings showing 63% rating trust a major business issue.
Leaders agree technology has exacerbated the challenge. How to navigate consumer reactions to cybersecurity, data privacy, technology failures, network outages and the like, and the underwhelming customer experiences these issues create, weighs heavily on CEOs. Social media, relentless press and, in sectors like financial services, intense government and regulatory focus on business behaviours, is driving a non-negotiable imperative for transparency and increasing calls for greater CEO accountability.
CEOs must monitor stakeholder trust
Addressing the issue will undoubtedly require a variety of responses. However, 68% of Australian CEOs strongly agreed it’s more important than ever to have a strong corporate purpose reflected in their company’s values, culture and behaviours. Over 50% also believe the businesses should be run to accommodate the interests of a broad range of stakeholders, not just shareholders. We find this consensus necessary and encouraging.
It is rare to find an Australian company monitoring stakeholder trust with the rigour and consistency it applies to conventional non-financial measures of its market impact (customer satisfaction and advocacy, employee engagement, brand health etc). The level of CEO concern suggests this needs to change. While typical non-financial measures may provide a ready basis for diagnosing potential trust issues, and framing tactical responses, if companies do not understand the drivers of stakeholder trust, a sustainable and resilient approach is unlikely to evolve.
Trust comes down to values, competence and customer experience
PwC recognises that the process of understanding what trust is, and how it can be measured and enlisted to underpin key business decisions, is complex and goes to the heart of a company’s values, competence and customer experience.
A starting point for all CEOs and their teams is to understand how they are demonstrating to stakeholders their commitment to integrity and values. A breach of values can be irretrievable. So balancing thorny issues like executive pay and the treatment of employees and communities is key.
Secondly, how are CEOs ensuring the customer receives the expertise and competence they have bargained for? Again, this is something no organisation can afford to consistently fail if repeat business is the aspiration. Thirdly, what experience are customers receiving in both good times and bad?
Consistently great customer, employee and stakeholder experience will cover all manner of sins when it comes to building, maintaining and leveraging trust.
Find out why PwC believes Trust is 1 of 5 key areas that Australia’s CEOs should focus on this year to set their companies up for long-term, sustainable success.