While the headline of the Edelman Trust Barometer Spring Update is the stunning, all-time high of trust in government (with local government outpacing trust in federal government by 20 points in the U.S.), it would be wrong to assume that this is a time for business to take to the sidelines.
On the contrary, we’re facing a once-in-a-century moment for business to step forward. Many lives and livelihoods depend on it.
Just in January, we reported that business was the only institution seen as competent and that there was a need for CEOs to take the lead and speak out on social issues such as income inequality: a reflection that stakeholder capitalism was gaining steam.
Fast-forward five months and less than one-third (27 percent) of U.S. respondents say CEOs have done an outstanding job of responding to the pandemic (compared to 50 percent who say local government leaders have).
CEOs can choose to see this as either a diminution of their leadership or as a clarion call. Two supporting facts for the latter:
- One, 50 percent of the public still feel that business needs to take a lead in providing economic relief and support.
- And two, 60 percent in the U.S. say that CEOs should take the lead on pandemic response, vs. waiting for the government to impose restrictions and demands on their businesses.
Most immediately, CEOs must answer the pressing question: how will business lead in the “return to work? It’s the test of trust for all institutions but none more so than business, with the most at stake.
For those that are restaging for a “return to work” the unimaginable constraints to resuming life and commerce should be a test of ingenuity. Developing a blueprint for a new normal in society and at the workplace—perhaps for years to come—calls for an innovation (not simply compliance with government guardrails) from all businesses we haven’t needed before. Getting employees comfortable with it is the next hurdle. At every step, business needs to lead in partnership with government, recognizing the special trust that is now being placed in local government, and the pragmatic need for local partnerships at a time when re-openings will be regional or hyper-local in scale.
For companies that are thriving (in relative terms) because of their essentiality in the moment, these leaders bear the mantle of stakeholder capitalism—and they need to take this moment to fully embody its spirit. A Fortune survey of Fortune 500 CEOs out this week shows that 50 percent of CEOs believe now should be the time to accelerate the move to stakeholder capitalism; this is a moment to live those words. Considering that 60 percent in our US Trust Barometer say the pandemic has made them realize “how big the gap is between the rich and working class, and that more needs to be done to distribute wealth and prosperity more fairly,” the desire for stakeholder capitalism remains strong.
Those companies that are fighting for survival—navigating debt covenants, managing for cash, grappling with unsustainable losses—are now far removed from the promise of business to serve all stakeholders. These leaders must communicate with principle. They have an obligation to be upfront with their employees and to lead with humanity.
For all businesses, this is a time for transparency, with employees and consumers treated as one community. CEOs have a mandate to explain their thinking and their prioritization—of people and profits, shareholders and the community—openly, and in a straightforward manner.
The next window for business to deliver on a once in a century ask begins now. How will people remember what your company did in the time of Covid-19?
Russell Dubner is President and CEO of Edelman’s U.S. operations.
About The 2020 Edelman Trust Barometer Spring Update:
Trust and the Covid-19 Pandemic
The 2020 Edelman Trust Barometer Spring Update: Trust and the Covid-19 Pandemic is an update to the 2020 Edelman Trust Barometer. The survey was conducted by Edelman Intelligence between April 15 and April 23, and sampled more than 13,200 respondents in 11 markets: Canada, China, France, Germany, India, Japan, Mexico, Saudi Arabia, S. Korea, U.K. and U.S. 1,200 people were surveyed in each market, 100 of which were informed public. All informed public respondents met the following criteria: aged 25-64, college-educated; household income in the top quartile for their age in their country; read or watch business/news media at least several times a week; follow public policy issues in the news at least several times a week.
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