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People want leaders they can trust. People want leaders who know the way and show the way by example.

Commentary and Analysis

America has a Trust in Leadership Crisis

The 2013 Edelman Trust Barometer reveals a serious crisis of confidence in leaders of both business and government.

Less than 20% of the general public believes business and government leaders tell the truth when confronted with difficult issues. In other words an overwhelming 80% of people just don't believe their leaders anymore.

This lack of confidence in traditional authority figures was underscored in 2012-13 against the backdrop of high-profile scandals involving senior leaders and government officials, including former McKinsey managing partner Rajat Gupta, former Chinese government official Bo Xilai, Lance Armstrong, former chairman of the Livestrong Foundation, and Cardinal Roger Mahony, former leader of America's largest Roman Catholic archdiocese.

The increasing number of scandals in almost all sectors of society involving greed, winning at any cost and covering up immoral, unethical or illegal behavior has caused a steep, measurable decline in good faith and fair dealing over the last 40 years. The deep erosion of trust in leaders can be seen clearly in the Edelman survey chart below showing the responses to the question: "How much do you trust business and government leaders to do the following?"

The shock of 2008, the subsequent recession and misdeeds by establishment figures have forced a reexamination of expectations of institutions and their leaders. What a organization does as well as how it does it are now both dependent upon trust and credibility. Running a successful organization and having business results focused leadership no longer, alone, builds long-term trust. Today, striking the right balance of business and people priorities is required.

In addition a recent AP-GfK poll found that most Americans don't trust each other anymore. Only about one third of Americans think others are trustworthy, and a record high of nearly 66% say “you can’t be too careful” in dealing with people.

Trust in the other fellow – the gut-level glue of democracy seems to be a value on the verge of extinction. America is obviously at the crossroads in respect to trust, and our future depends on an profound understanding that we are shipmates on a social/economic ship that will certainly sink if urgent action isn't taken to restore trust in leadership.

Rebuilding Trust in Leadership in Business and Government is Imperative

TRUST MATTERS!No business, government or society can survive when only 20% of the people believe their leaders.

Trust is the new currency. Success is as much about the trust companies receive in the marketplace and the acceptance they get in a social world as it is about a company's profitability or products.

For better or worse, the emergence of a ubiquitous social media that transmits any hint of an organization's faux pas or scandal instantaneously to millions of people via Twitter, Facebook, You Tube, et al, is the new reality. Institutions can't bend the truth or 'spin' facts to minimize uncomfortable stories and get away with it.

THE CHALLENGE — Business must embrace a new mantra: move beyond earning the License to Operate – the minimum required standard – toward earning a License to Lead – a higher moral standard. A License to Lead means an organization can always be depended on to operate in good faith and fair dealing. Dealing fairly means balancing the needs of all shareholders and other stakeholders (employees, community, society) by being profitable and good corporate citizens.

Rebuilding trust is the leadership challenge of lifetime. It requires absolute commitment and determination and the recognition that there are no short cuts, quick fixes, or silver bullets. Trust will be rebuilt by senior leaders who are committed to changing the status quo, and who know the way and show the way by their example.



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