During my trip through Europe last week I did media interviews with a number of the leading publications in the region. Here are some highlights from my discussions with the Irish Independent and El Mundo.
Irish Independent: Do CEOs absolutely have to opine on big issues? Can’t they just keep their heads down and let others take the lead or put out a bland statement about ‘respecting everyone’s values’?
Richard Edelman: I expect CEOs to stand up and speak on the issues of the day and not wait for government. CEOs can’t be putting their finger up and seeing which way the wind is blowing. You have to decide, and you have to speak. The new normal for CEOs is to opt for participation instead of the so-called ‘no-risk’ play, which is not to say anything. Otherwise, you’re going to be seen simply as a guy working for Wall Street. And that’s not what the job is anymore. You’ve got a stakeholder world, not a shareholder world.
Irish Independent: Why has it become so important for them do this?
RE: Most importantly, it’s about staff morale and retention. I think the core constituency is actually the employees. Our [most recent] Edelman Trust Barometer shows clearly that the new ‘most trusted institution’ is ‘my employer’ not the government. So, employees will work for companies where they feel that the values are equivalent to their own. Employees are saying that they want the company [they work for] to aspire to something and to have a purpose. In an economy where you’re short of people, the employees actually now have the power.
Irish Independent: What is your take on the current state of media?
RE: There needs to be a different business model with conferences and other things. But the current model is broken. It’s right thought bubble or left thought bubble. And you only read what you agree with, reinforcing your opinions. And so the media, in order to have a business model seems to migrate right or left.
Irish Independent: Are there still too many newspapers?
RE: There are never too many newspapers. There are now too few, with too few reporters. In the U.S. I think there are less than half as many people in local newspapers. So who’s going to fill in? I look at my own behavior. When I wake up in the morning, I’m looking at Axios and Politico and things that are verticals, as well as the Financial Times, The Wall Street Journal, The New York Times and Bloomberg.
El Mundo: How would you summarize the evolution of trust since you started the Edelman Trust Barometer?
RE: There are several great conclusions. The first one is the fall of confidence in government. The second one, the dissatisfaction of the lower classes. The third one is related to people’s fears to issues such as robotization and job loss. In fact, four out of every five people think that their situation will be worse in the next five years.
There has also been a change in the authority paradigm. Before, it was up-down—imagine Moses with his Tables of the Law. Now we give authority in a horizontal way, to other people like us, someone in our family or group of friends, and trust is local. And above all, people place trust in companies and brands.
El Mundo: Isn’t it impressive that we trust more in our company than in other institutions?
RE: The employer has become the last option. Media has fallen because of fake news and government trust has dropped. So, who should we trust? We need to trust in our employer. One of the points that interests me most, is that companies hit rock bottom in trust in 2008, since then, they have gone up and today, they generate higher trust that NGOs.
El Mundo: According to the Trust Barometer Special Report: In Brands We Trust?, more than the 50 percent of the people think that brands have better ideas to solve social issues than governments. You even talk about brand democracy. But does this present the risk of brand dictatorship?
RE: I understand your skepticism, but I am very optimistic towards brands. I see that they are facing very important challenges like e-commerce and disruptor brands. They are realizing that purpose and having something distinctive is more powerful. Our data shows that two-thirds of consumers will buy or boycott a brand solely because of its position on a social or political issue.
El Mundo: You talk about the impact of fake news a lot. Do you think people are aware of its impact and is that why the trust in traditional media has gone up?
RE: The fall in trust in social media is huge among developed countries. And this is the result of fake news. It has become hard for people to be sure of anything. And this is tragic. But this situation benefits journalists and media. As long as newspapers keep adapting to how and when the public wants to consume the news, they will do well.
El Mundo: Spain, just like other countries, is going through a difficult political situation. What should politicians do to regain trust?
RE: They must work to eliminate inequalities and fears, as well as, collaborate with the private sector, because the idea of the government managing it all by itself is ridiculous. Above all, there needs to be optimism, which there is not. I was a little kid when Kennedy got elected, but I remember his optimism showed that we could even go to the moon. I think that it is necessary to have that optimism and vision, instead of fighting over small things.
Before my European trip, I had not understood the fragility of the Continent. At the moment, the EU is governed by fears, from job loss to a machine, to downward economic mobility due to globalization. Four in five people believe that they will be worse off a decade from now, and two-thirds worry that the pace of innovation is too quick. Populism is a response to those who believe the game is rigged, a desperate attempt to maintain the status quo. Europe is only made more vulnerable by cheap tricks by candidates, such as moving General Francisco Franco’s body out of the Cemetery of Heroes after 44 years as a means of rallying Socialist voters in Spain. Or the disgrace of the Woodford Equity fund wind-down that left hundreds of middle-class pensioners grasping for what little is left after accusations of active manipulation of performance metrics to mislead investors. It is essential for those in a position of authority to provide a credible path forward for Europe as a place with a distinguished past, a unique set of humanist values and a commitment to change.