9 November 2016 – A recent self-assessment by corporate affairs professionals of how much their corporation is trusted by stakeholders depicts a context of uncertainty. Only one in five (21%) believes their company holds a very high amount of trust to operate in the best interest of society, according to findings from GlobeScan’s new global survey of corporate affairs professionals. They are countered by the same proportion who report their stakeholders have very little or no trust at all in their business.
This muted feedback shows that it is increasingly urgent for companies to manage trust like a risk, as an unsettled trust environment is an impediment to navigating business challenges effectively. Sixty-six per cent of practitioners say that they expect public policy influencing to be a difficult area to manage in the next two years, and 64 per cent anticipate difficulty related to regulatory changes.
A more proactive approach to reputation management is becoming increasingly important to address these challenges. Four in five practitioners (79%) say that managing risks to their organisation’s reputation has become a more prominent part of their job over the past five years. In particular, environment scanning is now an important aspect of a risk mitigation strategy with 83 per cent reporting an increased focus on understanding the social context of operations compared to five years ago.
More strategic activities with higher value-add also demonstrate how companies are aiming to ramp up their approach to trust management by activating different levers to maximise the payoff on trust. Compared to five years ago, greater importance is now placed on working toward stronger alignment between local initiatives and global positioning, as well as to help define and develop the company’s corporate purpose (both 70 per cent).
Corporate purpose gives a solid opportunity for businesses to shape their trust risk management strategy. A strong majority of corporate affairs professionals surveyed (86%) claim that their company has a stated purpose in place, and link it to clear and positive outcomes for their business. Corporate purpose acts as an agent of change that drives employee motivation (95% agree), shapes internal cohesion by supporting long-term strategic planning (90% agree), and can ensure competitive advantage (86% agree). Externally, 71 per cent agree that it is a catalyst for enhanced trust levels in the business, and 84 per cent think that it enables greater facilitation of stakeholder conversations externally.
Managing trust risk also requires greater proactivity on stakeholder engagement. The basics of engagement seem to be in place across most companies surveyed, with strong majorities saying that activities such as stakeholder mapping (79%), the convening of roundtables (67%), or regular email contact (65%) are in place and developing, if not fully developed. However, the more innovative and promising activities that indicate a more strategic professionalisation of the approach to stakeholder engagement, while gaining traction, are not systematic yet. The thought leadership aspect of engagement in particular, while having become more prominent over the past five years, can still be mainstreamed further.
Just one in two say their company is developing campaign-based strategies to initiate engagement with stakeholders (and 76% think this is an effective format), but almost the same proportion (48%) have not implemented any initiatives in this area.
Christophe Guibeleguiet, CEO GlobeScan said: “Trust has never been so high on a company’s agenda and this is for good reason. Trust in business has become a scarce commodity where the stakes are high and the risks well known. Corporate purpose is likely to become the epicentre of trust risk management, re-designing the trust landscape around the organisation as well as providing a catalyst for engagement activities that will ultimately drive trust value.”
GlobeScan is a strategy consultancy specialising in stakeholder intelligence and engagement in the areas of reputation, sustainability and purpose. We help global companies, multilateral organisations and international NGOs build stronger, more trusting relationships with their stakeholders to deliver long-term success.
GlobeScan has offices in Toronto, London, San Francisco, Cape Town, Sao Paulo and Hong Kong.
For more information please visit www.GlobeScan.com