For 15 years, the Edelman Trust Barometer has measured trust in institutions, including business, media, NGOs and government. In 2015, we surveyed 33,000 respondents in 27 countries. Since we began tracking trust in financial services in 2011, we have seen a modest increase from 48 percent to 52 percent on a global basis.
Nevertheless, we continue to find alarming trends today at the global, macro-economic level. Institutions are working through costly legal outcomes, coupled with new capital retention requirements brought on by greater regulation. Still, we expect the market can digest these changes and move ahead.
More troubling are signs of fear and distrust coming not from institutional fragility, but from attacks by hackers, cyber-terrorists and rogue players gaming the system to create unfair advantages.
The emergence of this darker “underbelly,” at a time when positive momentum is growing in financial services, is limiting what would otherwise be even stronger scores. Still, we see glimmers of hope when we drill down into the specifics and find new communications strategies for building trust.
TRUST IN INNOVATION: FINANCIAL SERVICES
One encouraging area of innovation in the financial services sector was electronic and mobile payment systems. These garner more trust (69 percent) than the industry overall (54 percent). Credit is due to an industry that has responded quickly to shield consumers from liability on card fraud and is working collectively to protect financial systems on a broader front.
The data tells us that while only 54 percent of respondents trust the financial services industry as a whole, 62 percent feel the industry is acting responsibly in the way it is bringing electronic payments to the market.
In fact, this is the only innovation story that scores better than its respective industry overall. In virtually every other example we studied, there was less trust in innovation than in the sector as a whole (e.g. trust in the tech industry to protect information in the cloud).
Nevertheless, this tells us something. It shows there is an opportunity, if handled well, to use new innovations to build trust. Sixty-nine percent of those surveyed trust the innovation of new electronic and mobile payment options, thus were ready to leap forward to use them; they saw massive conveniences and greater personal efficiency even in the face of added risks.
EARNING TRUST AGAINST THIS COMPLEX BACKDROP
Looking at the bigger picture, there is further ground for hope. Innovations that touch consumers on a personal level can counter balance security concerns. Companies can act to chart a path to public trust. Eighty-two percent of respondents agreed that “makes my life easier” is an important trait for building trust.
What can companies do to take advantage of these opportunities?
Focus on discovery, establish personal and societal benefits.
Communicating the financial stability of institutions, listing the steps they are taking in data security and highlighting the innovations that traditional institutions are developing can make a difference. Mobile banking and electronic payments are a good example. Only 30 percent of respondents believe that businesses are interested in “improving peoples’ lives.” The innovation story so proliferate in financial services needs to resonate with consumers through regular, two-way engagement and active consumer participation in product development itself.
Act with integrity, rigor and self-awareness. Take sustainability into consideration. Be consistent in reporting and tell people how you are doing. This is a long-term, not short-term strategy.
Start with social listening; having a well-communicated culture that is focused on an institution’s people and the communities in which they live and work. Only 24 percent of respondents expect that businesses will “make the world a better place,” while 54 percent say they will refuse to do business with companies that do not. Consumers are sending a crystal clear message with this finding. Companies that are listening to their customers on this will gain the greatest advantage.
Listen, share information and improve products. Do not be afraid to acknowledge problems but be sure to take steps to solve them.
It is vital to communicate across all platforms and in every priority area – operations, purpose, products and services, engagement and integrity. Eighty-three percent of those we surveyed told us that “keeps my family safe” was an essential attribute – but only 56 percent thought the financial services industry was performing well on this measure. Strengthening collaborative approaches to data security and privacy, standing for consumer protection and making sure the institutions themselves remain strong will help to close the gap.
The good news is that the 2015 Edelman Financial Services Trust Barometer shows a public willing to partner and engage and one that is open to innovation. Now is our chance to build on that. We need to make them aware of what the industry is doing to improve security, safeguard our financial systems and bring greater access to developing communities around the world.
View the presentation below to learn more about trust in financial services.