Building Trust: A Leadership Imperative

For many years trust has been considered a “soft” corporate issue, in part because it has been so difficult to measure. Whilst intuitively leaders knew that the level of trust in the organisation impacted team performance and company value, there was no concrete evidence to support this. However, new research by Accenture has quantified the impact of trust on a company’s competitiveness. And the bottom line is that trust is anything but soft.

What is trust?

Accenture Strategy defines trust as “a consistent experience of competence, integrity, honesty, transparency, commitment, purpose and familiarity.” Trust acts as a lubricant that helps oil a company’s relationships with its stakeholders and, in doing so, builds shared value for the business. When there is an actual or perceived breach of trust then the impact on the business can be catastrophic. Remember the impact that the Enron scandal had on its accountants Arthur Andersen. Whilst eventually Arthur Andersen was exonerated from any wrongdoing, it was not before the company imploded, as clients left in droves not wanting to be associated with a business that was perceived to have been complicit in the demise of Enron.

Technology, social media, and the digital economy have resulted in trust incidents becoming increasingly visible to the general public. This heightened transparency means trust is a highly flammable, ever-present concern for business leaders. No longer can leaders assume that breaches of trust can be dealt with by great PR interventions. Instead, business leaders need to intentionally create a culture that builds, maintains, and preserves trust.

Trust needs to become baked into the DNA, strategy, and day-to-day operations of all aspects of business because it impacts relationships with all the business stakeholders.


Increasingly, customers have more choices than ever before and are selecting providers based on values alignment. Customer satisfaction occurs when a companies products and services live up to brand promise thereby improving reputational value and trust. Companies that cannot deliver on brand promise or transparency will lose customer trust and, consequently, business.

A recent Accenture Strategy study of 25,000 global consumers found that, of customers who switched companies in the past year, 46 percent did so because they lost trust in the company. And switching isn’t the total cost. Customers are willing to speak up, organize, and boycott when their expectations aren’t met.


In the war for talent, a company’s reputation and actions become more important to job seekers. Accenture Strategy research revealed that more than one-third of workers surveyed ranked reputation as a top-three motivation to work for their current employer.

Suppliers and trusted partners

Key players in today’s business value chain are suppliers and trusted partners as they enable faster innovation cycles with more flexibility. The recent Accenture Strategy research points out that 84 percent of supply chain executives say they will increasingly use distributed manufacturing networks (more third parties) to meet customer demands.


The advent of social media has meant that the opinions of the general public play out in real time across all forms of media.  This has can have both positive and negative impacts on building trust, and also provide a forum whereby negative trust breaches can be acknowledged and rectified.

Analysts and Investors

Increasingly, analysts and investors are not just interested in the financial metrics of a business, but also in the reputation, social impact, sustainability, and employee engagement. A joint report developed with the United Nations Global Compact found that 88 percent of investors see sustainability as a route to competitive advantage.

With trust impacting so many aspects of a business, it is essential that leaders focus on how to build trust and embed a trust into the organizational culture. They need to that ensure that all the companies behaviors and actions match the company stated values in the eyes of all major stakeholders. This means ensuring that there is alignment throughout the organisation and everyone is pulling together in the same direction.

The consequence of leaders not focusing on developing a trust-based culture within the organisation is that it can significantly negatively influence the bottom line and competitiveness in the marketplace.

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