2010 Edelman Trust Barometer Finds Trust is Now Essential Line of Business to be Developed and Delivered
TORONTO, Feb. 23 /CNW/ - After a year when trust in business sunk to historic lows, trust in business is now up in Canada and around the globe, according to the 2010 Edelman Trust Barometer - an international study of opinion leaders aged 25-to-64 conducted by Edelman, the world's largest independent public relations firm. Yet despite the increase in trust here at home - up seven points to 54 per cent - the rise is tenuous, as most (70 per cent) informed publics in Canada expect businesses and financial companies to revert to their old habits when the financial crisis is over.
"Trust in business has improved, but the patient has a long road to go for a full recovery," said Richard Edelman, president and CEO, Edelman. "The increase in trust in business belies its fragility. There is concern that short-term actions have been taken only as a result of the crisis and that government will need to remain a watchdog. Companies will have to prove the skeptics wrong and show they can achieve both profit and purpose."
Among informed publics aged 35-64, trust in business is at its highest level (57 per cent) in four years and business and NGOs are now tied as the two most trusted institutions in Canada. While trust in government remains relatively stable, trust in both it and the media have dipped to 47 and 40 per cent from 51 and 47 per cent in 2009, respectively.
Canadian Banks a Bright Spot on the World Stage
While trust in banks in particular declined dramatically in most Western countries, Canada's financial institutions were sheltered from the global decline in trust. Indeed, trust in banks was up eight points over the past three years in Canada to 55 per cent, compared with the precipitous U.S. 39 point drop and global 11 point drop among older informed publics.
Canada also stood out on the world stage with its increased trust in the insurance industry. While still near the bottom compared with sectors like energy (64 per cent) healthcare (63 per cent) and the most trusted - technology (71 per cent), when asked how much they trust the industry to "do what is right," Canadian opinion leaders gave the insurance sector a boost of confidence this year with a 17 point jump over 2009 - from 34 to 51 per cent.
"Canada was recognized globally during the recession as being one of the G7's more stable banking industries. When juxtaposed against other Western economies where governments invested heavily in bailouts, Canada's tighter regulation and oversight of financial institutions facilitated more confidence," said Heather Conway, CEO, Edelman Canada. "Similarly, we haven't seen the collapse of insurance companies here at home and the subsequent impact on the economy like in the U.S. and the U.K. Canadians likely feel that our insurance industry is more stable and safe."
Trust and Transparency Key to Corporate Reputation
For the first time globally, this year's survey shows that trust and transparency are as important to corporate reputation as the quality of products and services. In Canada, these two attributes rank higher than product quality and far outrank financial returns, which sits at or near the bottom of 10 criteria in all regions. This milestone is in stark contrast to 2006, before the financial crisis hit, when financial performance was in fourth place in a list of 10 attributes shaping trust in Canada.
"We are seeing a vastly different set of factors driving reputation than we did 10 years ago," said Mr. Edelman. "Trust is now an essential line of business to be developed and delivered."
Canadian Companies Still Among Most Trusted in the World
As in previous years, trust in Canadian-based businesses remains high. In fact, Canada and Sweden are the two most trusted countries for global headquarters, with 76 per cent of global respondents reporting trust in companies headquartered there.
"It's important for Canadian-based companies to leverage this substantial asset - especially at a time when trust is at a premium," said Ms. Conway. "By listening to and engaging stakeholders, treating employees well and playing a role in solving major societal challenges, Canadian companies will continue to enjoy this well-earned reputation."
Who and What Do Canadians Trust?
In a year fraught with economic confusion and uncertainty, informed publics place the most trust in expert spokespeople and information sources, while trust in traditional media outlets continues to erode. Though trust in academics experienced a decline in Canada, 52 per cent of informed publics still view this group as the most credible source of information about a company.
The credibility of CEOs showed notable recovery in many markets including Canada, jumping 13 points to 40 per cent. Despite this climb, CEOs still rank in the bottom two in the list of trusted spokespeople in Canada, with "a person like yourself" (42 per cent), government officials (43 per cent), NGO representatives (50 per cent) and financial or industry analysts (50 per cent) all claiming higher percentages of credibility.
"CEOs who embrace this new line of business called trust have seen their credibility rise," said Mr. Edelman. "Stakeholders are beyond placing blame. They are looking for leaders who will deliver performance, communicate frequently and honestly, and consider the role of business in society."
In Canada, stock or industry analyst reports (50 per cent), articles in business magazines (40 per cent) and corporate communications such as press releases (40 per cent) were all cited as the most credible sources of information. However, the credibility of mainstream media, including television, newspapers, and radio, is waning. Among informed publics aged 35-64, the credibility of radio news alone dropped by more than 11 points - from 45 to 34 per cent - in two years.
"This is a stakeholder, not a shareholder world, and companies need to embrace a new era of active public engagement," said Ms. Conway. "This means participating in conversation in real time, championing open advocacy and building active partnerships for the common good."
All data refer to survey demographic of 25-to-64-year-olds unless otherwise noted.
About the Edelman Trust Barometer
The 2010 Edelman Trust Barometer is the firm's 10th annual trust and credibility survey. The survey was produced by research firm StrategyOne and consisted of 25-minute telephone interviews using the fielding services of World One from September 29 - December 6, 2009. The 2010 Edelman Trust Barometer survey sampled 4,875 informed publics in two age groups (25-34 and 35-64) in 22 countries. All informed publics met the following criteria: 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 http://www.edelman.com/trust
Edelman is the world's leading independent public relations firm, with 3,200 employees in 51 offices worldwide. Edelman was named Advertising Age's top-ranked PR firm of the decade, PRWeek's "2009 Agency of the Year" and "Large Agency of the Year" (for the third time in the last four years), and Holmes Report's "Agency of the Decade" and "2009 Best Large Agency to Work For." Edelman owns specialty firms Blue (advertising), StrategyOne (research), and BioScience Communications (medical education and publishing). Visit www.edelman.com for more information.
SOURCE EDELMAN TRUST 2010
For further information: For further information: Matthew Kanas, Edelman, (416) 979-1120 x346, Matthew.firstname.lastname@example.org