Tuesday, 3 February 2009

Trust in charity: Trust its leaders.

The recession has blown trust in bankers and business. The third sector is now one of the most trusted institutions in the country. What are the lessons to be drawn? How do we as the sector leaders use this trust to build our sector? And what are the lessons for Government, business and politicians.


But first the evidence. Each year the Edelman group produce a Trust Barometer for the leaders at Davos. It is a survey of some 4500 "opinion leaders" across 20 countries. It measures the credibility of institutions. And the results this year have been startling. 62% said they trust companies less this year than last. Just 38% say they now trust business. Only 31% trust banks . In media it is a staggering 28%. Yet trust in our third sector NGOs rose by 12% from last year. Trust is high in our sector at 54%.


People polled said they wanted to see more partnership working between sectors to solve the economic crisis. Indeed, when these results were presented at a breakfast meeting in London by Edelman they said that the key message from this data is that governments and commerce need to work with and to build partnerships with the third sector.



Mr Edelman , quoted in the FT, said " mutual social responsibility" must be key to recovery. "Companies that walk away from the big social issues or say that they can't afford to be sustainable will be making a big mistake".


Looking at the reasons for the declining levels of trust, for business one of the key issues is corporate tax avoidance. Although apparent for years this issue is only now really reaching the public domain. Polly Toynbee discusses how these same corporations will hide this and cover themselves by a glossy CSR statement in Saturday's Guardian.
http://www.guardian.co.uk/commentisfree/2009/jan/31/corporate-tax-avoidance-polly-toynbee.
As more evidence mounts, there is clearly going to be a further drop in levels of trust. How will these businesses respond to this? Well the danger is that we will see them become less transparent in order to protect their investments.


Is the Government willing to listen to this message?


The omens for this are mixed. For example the new body set up to manage the taxpayers share in the banks ( the UK Financial Institutions) is to be chaired by Mr Glen Moreno. He earns £450,000 as Chair of Pearsons and is a non exec Director of a hedge Fund. One doubts such a person will be stepping in to end the corrupt bonus and remuneration culture that permeate our financial systems to such dread effect on our economy. Yet governance reform of business ought to be a top priority for Government. This new body should be pushing a clean up of the stables of commerce.


One also hopes Government will be alert to the social consequences of a severe recession. There will be growing strains on social cohesion and the effects of long term unemployment are severe, as we know from previous recessions.


There are two lessons from the Trust data.



Business needs governance reform and a serious and genuine commitment to corporate social responsibility. This may require legislation.


Second, the Government and business need to work through, and in genuine partnership with, the third sector.


The forthcoming recession Action Plan for the sector, and the White Paper on Public Service Reform should be a bold statement of the role the sector must now play as a key agent of social and economic progress.



The Prime minister should display the same zeal and umph in this that he has on the banking crisis.


Our sector has grown to become a key economic player, as well as its vital role in holding together our civil society. There is still patchy understanding of the real potential we offer. It is not at the margins. Or as an after-thought.


So if Government and business want to regain trust they must now work in partnership with the third sector.

2 comments:

carl allen said...

Asking for trust is a one-off event which expends the trust given i.e. it needs to be renewed continually and not just before activities such as each annual report or election or major leadership decision.

Asking for trust is not a substitute for presenting an analysis of the issue i.e. have trust that those listening will understand or make the effort to understand.

It is an common but unproven assumption that Third Sectors leaders are inherently more trustworthy or should be trusted more when it comes to effective, efficient, economical, engaged and equitable "Working Together".

There is still, I think, both a patchy understanding and common misunderstandings of what "Working Toegther" means after a decade.

Janet F said...

Stephen, your use of figures (in your 'evidence') is appalling;

"62% said they trust companies less this year" does NOT mean that "62% don't trust companies" and therefore also does NOT mean, as you suggest, that "just 38% say they now trust business" - it means that 38% of people either trust companies MORE than last year or the SAME as last year.

It's fairly likely that 100% of people trust companies to some extent (given that most people engage with 'companies' to varying degrees it would be a surpise if it was much different to this figure) but, fairly obviously, by a different amount than last year (some more, some less, some the the same).

I didn't bother reading on as I'm not convinced I can trust what I read - if this is your use of 'evidence' to support your comments in this blog I think I'll wait for your next post...