Trust barometer

2020 Edelman Trust Barometer: A growing sense of inequity is undermining trust

Edelman Trust Barometer 2020-L

The 2020 Edelman Trust Barometer reveals that despite a strong global economy and near full employment, a majority of respondents in every developed market do not believe they will be better off in five years’ time, and 56 percent believe that capitalism in its current form is now doing more harm than good in the world.

“We are living in a trust paradox,” said Richard Edelman, CEO of Edelman. “Since we began measuring trust 20 years ago, economic growth has fostered rising trust. This continues in Asia and the Middle East but not in developed markets, where national income inequality is now the more important factor. Fears are stifling hope, and long-held assumptions about hard work leading to upward mobility are now invalid.”

The concerns are wide-ranging and deep. Most employees (83 percent) globally are worried about job loss due to automation, a looming recession, lack of training, cheaper foreign competition, immigration and the gig economy. Fifty-seven percent of respondents worry about losing the respect and dignity they once enjoyed in their country. Nearly two in three feel the pace of technological change is too fast. And there is no agreed-on truth; 76 percent say they worry about fake news being used as a weapon.

A record number of countries are experiencing an all-time high “mass-class” trust divide, spreading from developed into the developing world. Globally, there is a 14-point gap between the informed public (65) and the mass population (51). There are double-digit gaps in 23 markets, including Australia (23 points), France (21 points), Saudi Arabia (21 points), Germany (20 points), the UK (18 points) and Spain (17 points).

Business (58 percent) is the most trusted institution, taking the lead role in global governance. The recent decisions by the Business Roundtable to endorse a stakeholder model for American multinationals, the initiation of Business for Inclusive Growth focused on fair wages by French multinationals and the Business Ambition for 1.5°C recognize the broader responsibility of the corporation.

“Business has leapt into the void left by populist and partisan government,” said Edelman. “It can no longer be business as usual, with an exclusive focus on shareholder returns. With 73 percent of employees saying they want the opportunity to change society, and nearly two-thirds of consumers identifying themselves as belief-driven buyers, CEOs understand that their mandate has changed.”

CEOs are expected to lead from the front. Ninety-two percent of employees say CEOs should speak out on issues of the day, including retraining, the ethical use of technology and income inequality. Three-quarters of the general population believe CEOs should take the lead on change instead of waiting for government to impose it.

“People’s expectations of institutions have led us to evolve our model for measuring trust,” said Edelman. “Trust today is granted on two distinct attributes: competence (delivering on promises) and ethical behavior (doing the right thing and working to improve society). It is no longer only a matter of what you do—it’s also how you do it.”

This year’s results reveal that none of the four institutions is seen as both competent and ethical. Business ranks highest in competence, holding a massive 54-point edge over government as an institution that is good at what it does (64 percent vs. 10 percent). NGOs lead on ethical behavior over government (a 31-point gap) and business (a 25-point gap). Government is perceived as both incompetent and unethical but is trusted more than twice as much as business to protect the environment and close the income inequality gap.

Media is also viewed as incompetent and unethical: a majority (57 percent) don’t believe the media does a good job of differentiating opinion and fact but find them invaluable on covering news (58 percent).

“After tracking 40 global companies over the past year through our Edelman Trust Management framework we’ve learned that ethical drivers such as integrity, dependability and purpose drive close to 76 percent of the trust capital of business, while competence accounts for only 24 percent,” said Antoine Harary, president of Edelman Intelligence. “Trust is undeniably linked to doing what is right. The battle for trust will be fought on the field of ethical behavior.”

Other key findings from the 2020 Edelman Trust Barometer include:

  • Both business and government can take specific actions to achieve a higher trust score. Respondents expect business to focus on paying fair wages and retraining. For government, the actions include reducing partisanship, addressing community-level problems and partnering with business and NGOs.
  • Local/state government (54 percent) is more trusted than central/federal government (51 percent).
  • While government remains tied with media as the least trusted institution, it is the group most believe is best suited to address the issues of healthcare (53 percent); income inequality (51 percent); immigration (48 percent); harmful products (42 percent); and inclusion (41 percent).
  • Technology (75 percent) remained the most trusted sector but saw the biggest drop globally at four points. Several markets experienced dramatic drops, including France (-10 points), Canada (-8 points), Italy (-8 points), Singapore (-8 points), Russia (-8 points) and the U.S. (-7 points). And technology is no longer the most trusted sector in 9 of the 28 markets we survey, including Australia, Canada, Hong Kong, Italy, Russia, Ireland, Singapore, The Netherlands and the UK.
  • No institution has a vision for the future that a majority of respondents believe in: government (35 percent); media (35 percent); business (41 percent); NGOs (45 percent).

The 2020 Edelman Trust Barometer is the firm’s 20th annual trust and credibility survey. The survey was powered by research firm Edelman Intelligence and consisted of 30-minute online interviews conducted between October 19 and November 18, 2019. The 2020 Edelman Trust Barometer online survey sampled more than 34,000 respondents, which includes 1,150 general population respondents across 28 markets and 200 informed public respondents in each market, except China and the U.S., which have a sample of 500 informed public respondents each. 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. For more information, visit https://www.edelman.com/trust-barometer

Richard Edelman, president and CEO of Edelman – about PRWeek’s award

Here are a few observations on how this happened:

  1. Independence — We did not follow the crowd and sell to the holding companies. That single decision, taken by the family, was fundamental to our growth. We did not reduce head count during the recessions of 2001 and 2008; we just did not make money. We invested in acquisitions, even in challenging periods, to grow our geographic footprint and improve our expertise in markets such as Atlanta or the Bay Area.
  2. Digital — We were early in this and stayed with it. From the online version of the Butterball Turkey Talk-Line in 1997 to the brilliant work on Samsung Mobile of today, the growth of Edelman is one-half attributable to our digital team. Digital also brought us into creative and planning. I have also benefited by speaking directly to the industry through my weekly 6AM blog since 2004.
  3. Trust — We started the Edelman Trust Barometer in 2000 after NGOs stormed the World Trade Organization meeting in Seattle, protesting globalization. This annual study has propelled us into important conversations around trust at work, trust in “a person like me,” and the mass-class divide. We are now mentioned as a thought leader in the same breath as major consulting firms, such as McKinsey.
  4. Creative — We have always believed in powerful ideas. But now those ideas must prompt action by our clients. The Dove Campaign for Real Beauty, REI OptOutside and CVS’s decision to remove cigarettes from its stores are all indicative of our Evolve, Promote, Protect philosophy, which asks for tangible steps before any communication.
  5. The Rise of Corporate — With wins like Walmart and GE, on top of work with Samsung and Johnson & Johnson, Edelman moved from a sole reliance on brand marketing to an even balance with corporate reputation and public affairs. Much of our best work for HP, Starbucks and AstraZeneca reflects the combination of both sides of the house.
  6. Going Global — We were an American firm sending work to overseas offices. Then we grew in the UK, where we hub Unilever, Shell and GSK. Now we are building up China, France, Germany and India as global hubs. That requires us to have a more multinational workforce in these key markets.
  7. Stable Top Management — Matt Harrington, our COO, has been at Edelman for 29 years; Vic Malanga, CFO, 22 years; Russell Dubner, U.S. president and CEO, 26 years; Lisa Sepulveda, chief client officer, 25 years; Ben Boyd, chief client strategy officer, 14 years. I also want to thank others, such as David Brain, Michael Morley, Pam Talbot, Katie Burke, Jackie Cooper, Charles Fremes and Kevin King for their unique contributions to our development.
  8. Community Involvement — We have always tried to maintain a deep connection to the communities we work in. We have done pro bono work in Dallas, Orlando and Charlottesville in the wake of tragedies. And we have also provided our services to communities dealing with natural disasters (Puerto Rico), and issues such as gender equality (Hong Kong) and disease awareness (UK).
  9. My Father — We worked together for 34 years, the majority of which felt more like I was working with my brother than my dad. He put the scepter in my hand in 1997. He put up with my failed implementation of a new accounting system and a few less than optimal acquisitions. He stayed in the business to make sure that his son did not “screw it up.” At age 90, after I was CEO for 15 years, he put his hands on my shoulders and said, “It’s time that you really take over. You have proven yourself.” And to my mother, one of my most trusted advisors. She was not only privy to the strategy and planning for the agency, but she had a lot of input on the major decisions we made as a firm.

Media Now Least-Trusted Institution Globally

The 2018 Edelman Trust Barometer reveals that trust in the U.S. has suffered the largest-ever-recorded drop in the survey’s history among the general population. Trust among the general population fell nine points to 43, placing it in the lower quarter of the 28-country Trust Index. Trust among the informed public in the U.S. imploded, plunging 23 points to 45, making it now the lowest of the 28 countries surveyed, below Russia and South Africa.

The collapse of trust in the U.S. is driven by a staggering lack of faith in government, which fell 14 points to 33 percent among the general population, and 30 points to 33 percent among the informed public. The remaining institutions of business, media and NGOs also experienced declines of 10 to 20 points. These decreases have all but eliminated last year’s 21-point trust gap between the general population and informed public in the U.S.

“The United States is enduring an unprecedented crisis of trust,” said Richard Edelman, president and CEO of Edelman. “This is the first time that a massive drop in trust has not been linked to a pressing economic issue or catastrophe like the Fukushima nuclear disaster. In fact, it’s the ultimate irony that it’s happening at a time of prosperity, with the stock market and employment rates in the U.S. at record highs. The root cause of this fall is the lack of objective facts and rational discourse.”

Conversely, China finds itself atop the Trust Index for both the general population (74) and the informed public (83). Institutions within China saw significant increases in trust led by government, which jumped eight points to 84 percent among the general population, and three points to 89 percent within the informed public. Joining China at the top of the Trust Index are India, Indonesia UAE and Singapore.

For the first time media is the least trusted institution globally. In 22 of the 28 countries surveyed it is now distrusted. The demise of confidence in the Fourth Estate is driven primarily by a significant drop in trust in platforms, notably search engines and social media. Sixty-three percent of respondents say they do not know how to tell good journalism from rumor or falsehoods or if a piece of news was produced by a respected media organization. The lack of faith in media has also led to an inability to identify the truth (59 percent), trust government leaders (56 percent) and trust business (42 percent).

This year saw a revival of faith in experts and decline in peers. Technical (63 percent) and academic (61 percent) experts distanced themselves as the most credible spokesperson from “a person like yourself,” which dropped six points to an all-time low of 54 percent.

“In a world where facts are under siege, credentialed sources are proving more important than ever,” said Stephen Kehoe, Global chair, Reputation. “There are credibility problems for both platforms and sources. People’s trust in them is collapsing, leaving a vacuum and an opportunity for bona fide experts to fill.”

Business is now expected to be an agent of change. The employer is the new safe house in global governance, with 72 percent of respondents saying that they trust their own company. And 64 percent believe a company can take actions that both increase profits and improve economic and social conditions in the community where it operates.

This past year saw CEO credibility rise sharply by seven points to 44 percent after a number of high-profile business leaders voiced their positions on the issues of the day. Nearly two-thirds of respondents say they want CEOs to take the lead on policy change instead of waiting for government, which now ranks significantly below business in trust in 20 markets. This show of faith comes with new expectations; building trust (69 percent) is now the No. 1 job for CEOs, surpassing producing high-quality products and services (68 percent).

“Silence is a tax on the truth,” said Edelman. “Trust is only going to be regained when the truth moves back to center stage. Institutions must answer the public’s call for providing factually accurate, timely information and joining the public debate. Media cannot do it alone because of political and financial constraints. Every institution must contribute to the education of the populace.”

Other key findings from the 2018 Edelman Trust Barometer include:

  • Technology (75 percent) remains the most trusted industry sector followed by Education (70 percent), professional services (68 percent) and transportation (67 percent). Financial services (54 percent) was once again the least trusted sector along with consumer packaged goods (60 percent) and automotive (62 percent).
  • Companies headquartered in Canada (68 percent), Switzerland (66 percent), Sweden (65 percent) and Australia (63 percent) are most trusted. The least trusted country brands are Mexico (32 percent), India (32 percent), Brazil (34 percent) and China (36 percent). Trust in brand U.S. (50 percent) dropped five points, the biggest decline of the countries surveyed.
  • Nearly seven in 10 respondents worry about fake news and false information being used as a weapon.
  • Exactly half of those surveyed indicate that they interact with mainstream media less than once a week, while 25 percent said they read no media at all because it is too upsetting. And the majority of respondents believe that news organizations are overly focused on attracting large audiences (66 percent), breaking news (65 percent) and politics (59 percent).

The 2017 Edelman Trust Barometer reveals that trust is in crisis around the world. The general population’s trust in all four key institutions — business, government, NGOs, and media — has declined broadly, a phenomenon not reported since Edelman began tracking trust among this segment in 2012.

With the fall of trust, the majority of respondents now lack full belief that the overall system is working for them. In this climate, people’s societal and economic concerns, including globalization, the pace of innovation and eroding social values, turn into fears, spurring the rise of populist actions now playing out in several Western-style democracies.

To rebuild trust and restore faith in the system, institutions must step outside of their traditional roles and work toward a new, more integrated operating model that puts people — and the addressing of their fears — at the center of everything they do.

Read more