In a year of global pandemic and economic recession, China proved once again its economic prowess: 2020 GDP is expected to result in a new high of 100 trillion yuan and is the only major economy expected to report growth for 2020 while the rest of the world continues to stumble. But underneath these robust economic numbers lie a 10-point drop in trust year-over-year, from 82 to 72. For the first time, China ceded the top Trust spot to India, and now ranks second of 28 markets, according to the 2021 Edelman Trust Barometer.

This decline comes after an eight-point Trust surge in April, after China successfully fought the first surge of Covid-19, lifted lockdowns and went back to business for a time. Notably, for the first time since we started tracking it for China in 2012, China’s mass-class divide reversed itself, with a trust score of 90 for the mass population, three points ahead of the informed public. The Spring trust bubble was short-lived, globally, and especially in China, which saw a precipitous 18-point drop over the past six months. This clearly reflects an introspective Chinese mindset that takes the long view on reacting to challenges, coping with uncertainties and thinking about trust.

Business dropped an astonishing 21 points (from 91 percent in May 2020 to 70 percent in January 2021), after a nine-point increase in the first six months of 2020; this is something rarely seen in the history of the Trust Barometer. The financial fraud case of Luckin Coffee commanded broad attention on compliance and corporate governance back in April. Six months later, Chinese regulators decided to suspend the IPO of the largest financial tech unicorn, Ant Group, followed by the anti-trust investigation of Alibaba.

Those actions are in line with global concerns about data monopolies and increased scrutiny of technology companies. In fact, trust in all sectors declined in 2021, especially from those closely related to people's lives, including drops in CPG (18 points), Technology (13 points) and Food and Beverage (13 points). It is also the first time since 2015 that all industries surveyed in China experienced trust declines.

The cautious skepticism in the face of a global pandemic is reflected in people's consumption behavior: China's CPI hit negative levels for the first time in more than a decade; this skittishness applied not only to purchasing of goods, but also to consuming news and information. Trust in all media types hit record lows, with a striking double-digit drop in historically well-trusted channels: both traditional media and search engines dropped by 19 points; owned media and social media declined 17 points and 14 points, respectively.

There is an urgent need to recalibrate priorities not just for short-term recovery, but more importantly, for future growth momentum. So what should business do?

Fully embrace the values of Trust: Stop short-term thinking; competence is essential but accountability and reliability are decisive. A 10-point drop in belief in companies’ “dependability” paves a clear roadmap for companies to refocus on long-term, purpose-driven business objectives, rather than scale and profit.

Fight the infodemic: Acknowledge the problem of insufficient “information hygiene”—careful vetting of information before sharing and seeking news from a variety of sources. Companies just take actions guided by their vision and values, before communicating with media strategically and selectively to break the void of biased news and the ever-present echo chamber.

Build trust for a shared future: The 2021 Edelman Trust Barometer reflects a mounting urgency among consumers for societal institutions to address big issues, from data privacy to improving the health system. This spells out a new and broader mandate for business to lead in addressing societal problems, in partnership with government and other institutions. For business, the time to act is now.

Kevin Wang is the Managing Director of Edelman China, Corporate and Reputation