“The toughest thing about the power of trust is that it’s very difficult to build and very easy to destroy.” - Thomas J. Watson
During the past 15 to 20 years, the world has experienced too many violations of business ethics to excuse them as aberrations. Although we mostly remember prominent names like Enron or Lehman Brothers, these cases represent the tip of the iceberg. Clearly, the disease of trust violation in business is much more widespread and deep-rooted than a few high-profile examples.
A recent report from the World Economic Forum, titled The Evolution of Trust in Business: From Delivery to Values, alerts us to the decreasing level of public trust in businesses all over the world. Business leaders can no longer ignore this issue because they don’t see a clear business case to justify addressing it. The report emphasizes that “in uncertain times, businesses need to build up a store of trust that will allow them to navigate a path through disasters of all kinds, while staying true to their values and presenting a clear message to all stakeholders when the going gets tough.”
How can an organization invest in and build a powerhouse of trust? Because it involves fostering an organization-wide culture, the issue can never be adequately addressed by the executive leadership team alone. The implementation of such a widespread culture change must be owned by a global team, and the team best equipped to handle this is the HR function.
The HR function of a global organization can play a significant role in developing the trust strategy to create a more committed, engaged, and aligned workforce. However, members of the HR team should keep in mind these three key recommendations.
1. Make trust an integral part of the organization's values.
Include trust-building as a fundamental principle in the organizational value system, and reinforce this principle as a learning objective in leadership programs and journeys. HR must drive focused initiatives around this principle and create evangelists at all leadership and managerial levels who can promote the benefits and best practices of trust-building measures throughout the organization.
In addition, there must be a strong whistleblower policy that is faithfully implemented and monitored through an independent process. Employees must be encouraged to report any incident of trust violation without any constraint, fear, or backlash.
2. Create a culture of challenging the status quo.
Create an environment within the organization where employees can try out new and disruptive ideas, challenging the status quo without fear of failure. The World Economic Forum report quotes Alan Webber, co–founding editor of Fast Company: “If you don’t have a culture where people feel that it’s OK to take a risk, with the understanding that the risk could fail, you’re unlikely to have much innovation, and a willingness to take on risk is all about trust.”
According to recent research by PricewaterhouseCoopers (as reported in the World Economic Forum study), a higher degree of trust in management means a more creative and innovative organizational culture. The HR function must facilitate the creation and deployment of such a culture.
3. Embrace the growth mindset.
In his July 2002 New Yorker article, Malcom Gladwell posited that the main reason why Enron collapsed was its obsession with the talent mindset. The talent mindset creates an environment that values individuals’ inner talents, so people often are afraid of tarnishing their reputation when attempting to solve a problem. “They will not take . . . remedial course[s],” Gladwell wrote. “They will not stand up to investors and the public and admit that they were wrong. They would sooner lie.”
Carol S. Dweck, a world-renowned psychologist and author of the book Mindset: The New Psychology of Success, recommends that an organization adopt a growth mindset instead of a fixed mindset so that it can continue to thrive, grow, and remain trustworthy to its stakeholders.
In Mindset, Dweck writes that the HR function can again play a critical role in effecting this culture change at an organization level by:
- designing the performance management system to recognize effort instead of innate talent or intelligence
- ensuring feedback “promote[s] learning and future success”
- "conveying that the organization values learning and perseverance, not just ready-made genius or talent,” so the skills and competencies of any individual can be continuously developed
- screening out fixed-mindset profiles when hiring senior executives
- avoiding groupthink at all critical decision-making stages.