The past two decades have seen a progressive destruction of trust in societal institutions, a consequence of the Great Recession, fears about immigration and economic dislocation caused by globalization and automation. Traditional power elite figures, such as CEOs and heads of state, have been discredited. The growth of social media platforms fully shifted people’s trust from a top-down orientation to a horizontal one in favor of peers or experts. Now we are seeing a further reordering of trust to more local sources, with “My Employer” emerging as the most trusted entity, because the relationships that are closest to us feel more controllable.
This shift is happening in the context of an acute “mass-class” divide. Trust among the informed public soared to a record high (65 percent) while the mass population continues to distrust institutions (49 percent). This profound ideological divide is in the double-digits in more than two-thirds of markets (highest in the UK, at 24 points), providing ample ground for nationalism, protectionism and insurgent grassroots movements. The trust inequality problem has moved into developed nations with egalitarian heritages, such as Canada (20-point gap) and is spreading into the developing world (17-point gap in India).
Pessimism is widespread. Only one-in-five of mass population respondents believe that the system is working for them; in developed markets, only one-in-three of that cohort believes his or her family will be better off in five years’ time. Fears of job loss among the general population remain high, whether caused by a lack of retraining and skills (59 percent) or automation and innovation (55 percent). More than twice as many of these respondents say the pace of innovation is too fast (54 percent) versus those who say it is too slow (21 percent).
Trust is also divided along gender lines, with women more skeptical about institutions than men. The gender trust gap is in the double digits in several developed markets; this is mostly driven by women’s lower trust in business (U.S., 15-point gap; Germany, 14-point gap).
Frustrated by their inability to effect positive change through the traditional electoral process, people are taking power back into their own hands. The Gilet Jaunes public demonstrations in France pitted the mass against the elite, forcing a retraction of a fuel tax. The #MeToo movement reached into the corporation, causing the exit of CBS chief executive Les Moonves and prompting a walkout by 20,000 Google employees to force change in the company’s standards of behavior. Tech companies have faced internal dissent over government contracts, with employees refusing to carry out projects from surveillance to security.
This urgent desire for change is driving a renewed interest in fact-finding, leading to a stunning rise in consumption and sharing of news, up 22 points in a year to 72 percent. This is a dramatic reversal from just a year ago, when half of our study respondents had walked away from traditional media because it was biased, chasing clicks and too upsetting to read. Trust in traditional media and trust in search are now tied at 66 percent, their highest historical levels, while trust in social media is in crisis (43 percent), especially in several developed regions that show enormous trust gaps between traditional and social media (U.S./Canada, 31-point gap; Europe, 26-point gap).
People have low confidence that societal institutions will help them navigate a turbulent world, so they are turning to a critical relationship: their employer. Seventy-five percent of respondents trust “My Employer”—19 points more than business in general and 27 points more than government.
Overwhelmingly, our employee respondents expect their employers to be their partners in change. Employees’ expectation that prospective employers will join them in taking action on societal issues (67 percent) is nearly as high as their expectations of personal empowerment (74 percent) and job opportunity (80 percent). Nearly six in 10 look to their employer as a trustworthy source of information on contentious social problems and on important topics like the economy (72 percent) and technology (58 percent).
This significant shift in employee expectations opens up an enormous opportunity for employers to help rebuild societal trust, as the general population sees business as being able to make money and improve society (73 percent). The result is a new employee-employer contract— Trust at Work—predicated on taking these actions:
- Lead Change – Establish an audacious goal that attracts socially-minded employees and make it a core business objective (for example, the Unilever Sustainable Living Plan to double revenue without increasing the company’s use of natural resources). To realize this full-scale commitment to societal change, companies must first address employees’ very real fears about the threat of automation to their livelihoods and provide them with retraining.
- Empower Employees – Go direct to employees with fact-based information about the issues of the day, supplementing the mainstream media, which has been winnowed by a difficult business model. Give employees a voice on your channels; trust in company-owned media rose by seven points this past year.
- Start Locally – Care for the communities where you operate, especially if you are a multinational. Be part of the solution on education, inequality and infrastructure. Enable your employees to volunteer and give back locally.
- CEO Leadership – CEOs must speak up directly on social issues, such as immigration, diversity and inclusion. But they must do more than talk; they must demonstrate their personal commitment, inside and outside the company. Seventy-six percent of people expect CEOs to take a stand on challenging issues.
Trust at Work is a fundamental rebalancing of the employee-employer relationship, shifting from top-down control to one that emphasizes employee empowerment. In a full employment economy, an employee has more freedom to choose the kind of workplace they are now coming to expect, one where values and the power to make change are a given.
This is the path that business must follow to help restore trust, the greatest moral challenge of our era. The critical work of building a better future for all begins in the workplace.
Richard Edelman is president and CEO.