New jobs. Rising wages. Record-low unemployment. These are the hallmarks of a healthy economy – and important proof points for U.S. President Trump’s victory lap in his inaugural State of the Union address last night. But whether you view these as facts or “alternate facts” depends hugely on both how you are personally experiencing the economy today, and where you sit on the political spectrum.
Underlying this deep divide is a crisis in trust. Many are simply unwilling to believe information from just about everyone, and particularly if that information comes from a government or media source. The 2018 Edelman Trust Barometer revealed an 18-year low in trust across government, business, media and NGOs in the United States — the steepest, most dramatic decline we’ve ever seen. Notably, trust in government fell 14 points to 33 percent among the general population. And media has become the least-trusted institution globally for the first time in Trust Barometer history.
This void left by government and media creates new expectations of corporate leaders. As Richard Edelman noted in his analysis of the 2018 Trust Barometer, nearly seven in 10 respondents say that building trust is the No. 1 job for CEOs, ahead of high-quality products and services. Nearly two-thirds say they want CEOs to take the lead on policy change instead of waiting for government, which now ranks significantly below business in trust in most markets.
It’s clear that consumers are increasingly thinking as voters — or at least consumers are telling pollsters and media they believe more than ever that a brand’s obligation to society extends beyond a quality product or service at a friendly price. Whether consumers are actually changing their buying behavior based on a company’s public stance on high profile issues is a huge focus for big data and analytics teams. But as the data is being culled, companies are already debating whether they should weigh in on an issue, and if so how to best do so without significantly alienating stakeholders who may disagree with their stance.
The first step is being prepared for various issue scenarios by taking into account how stakeholders—notably employees, customers and investors—will react to a company’s decision to weigh in or stand on the sidelines as an issue erupts. These scenario-planning exercises help define red lines for an organization as they determine whether an issue is too complex or too hot to touch, or if silence will do far more reputational harm than by taking a public stance.
The state of permanent protest that is defining public sentiment on all sides of issues also requires more active and sustained stakeholder outreach to ensure an organization’s values are clearly understood. The days of maintaining a happy blank slate when it comes to your values and views are rapidly sunsetting with each new digital-fueled moment of confrontation. Consumers are also voters, and today’s voters are more engaged, as voter turnout in our recent elections attests. Increasingly, companies understand they are on the menu for public debate as well, and those who are slow to take steps to prepare will continue to pay the price.
Still, work-a-day governing is still happening, and business leaders must find a way to work with policymakers, regardless of what leadership role businesses assume. As Washington sits gridlocked, savvy businesses will see that things can still get done at the state and local levels. Bringing together voices who understand the nuances of communities, from Newark to Boise from Birmingham to Seattle, can help businesses bridge ideological divides starting at the local level. Whether it’s tax policy, environmental regulations, net neutrality or legalizing marijuana, businesses must be present in their communities, galvanizing employees and stakeholders to join them in making a difference on policies that matter. No need to wait for Washington.
Rob Rehg, Chairman, U.S. Public Affairs.