On March 14th's NY Times Op-Ed page, Greg Smith, an executive in Goldman Sachs London office, wrote a scathing commentary attacking both the company’s leadership and its culture. Smith said he hoped the article would serve as a wakeup call for the company’s board of directors. I hope this opinion piece inspires you to begin rebuild trust in your organization.
In case you missed the media wildfire, what was revealed in the Op-Ed was ugly. Smith talked about a company culture defined by ripping people off; how clients were often referred to as “muppets” in internal emails; how the most common question he would get from junior analysts was “How much money did you make off the client?”
We are facing a serious problem regarding the decline of ethics, morals, and trust in the commercial sphere. What we need to realize is that these ethical issues are not limited to Goldman Sachs—they are happening all around the world, in businesses, governments, and throughout entire countries. The problems start at the individual level, with people just like you and me.
The 2012 Edelman Trust Barometer documents the extent of our dire situation. Their survey saw an “unprecedented nine-point global decline in trust in government.” Trust in business fell three points globally, down to 53 percent. Spain, France, and Germany were hit the hardest falling by 21, 20, and 18 points respectively, over the course of a year.
Entire industries have become suspect. Can you guess which industry is at the bottom of the trust pile? (Hint: it won’t help Goldman Sachs repair its reputation) Financial services declined an additional 3 points over the last year to come in dead last with just 45 percent of survey respondents saying they trust the industry to do what’s right. How can people put their life savings in the hands of people they don’t trust? The answer is: they won’t.
Before this gets too pessimistic, I will observe that now is not the time to sit around feeling sorry for ourselves! Because trust is built by individuals, on a person-to-person basis (not by entire companies, industries, or countries), you have a greater opportunity than ever before to participate in the solution.
In fact, right now, people like you are among the most suited to grow trust and help make positive transformations to the political and economic environment. According to the 2012 Edelman survey, respondents rated information from their peers as 65 percent trustworthy and credible, a 22 point increase from the year before. The credibility of peers was just below the top-ranked categories of academics (68 percent) and technical experts (66 percent).
We must use the power gained from this knowledge to exercise moral responsibility. By rebuilding trust in our personal lives we can reverse the decline initially at the local level, and then at the national and global levels. The personal trust rebuilding initiative starts by creating congruence between what you say and what you do; defining expectations and then meeting or exceeding them. Increasing face-to-face time, versus interaction through computers, hand-held devices, and social networking, is another way to increase trust. Being honest, sincere, and transparent also contributes to the perception that a person is fundamentally trustworthy.
However, the single most powerful way to build trust is to show a willingness to trust others. This does not mean being naïve, weak, or overly susceptible to people driven by greed. It does mean being open to taking calculated risks with coworkers, employees, and in relationships that are in the earliest stages of development. The fact is, trust will always be based on a certain willingness to take risks—and you can’t win if you don’t play the game.
In the wake of the scandalous Goldman Sachs Op-Ed piece, distrust of this company has resulted in a 2.15 billion dollar single day loss for shareholders—another example of how vital trust is to the stability of shareholder value, stakeholder interest, and to individual endeavors. It is the glue that secures customer relationships, employee loyalty, and vendor partnerships. It is preferable to contracts, organizational sanctions, or litigation.
Best of all, it all starts with you. The resources required to empower the change are within you. Let's start a movement!
Keld Jensen is an expert on trust, negotiation, leadership, and communication. To learn more, visit www.KeldJensen.com and sign up for his “Power Bargaining” newsletter.
