The 2011 Edelman Trust Barometer is a real downer for institutions in the U.S. The annual report of how well busines, government and other institutions are trusted around the globe shows that while trust is pretty stable elsewhere, it has plunged in the U.S.
Here is a quote from Edelman's press release about the 2011 Barometer:
"The United States was the outlier, as trust dropped across all institutions--business, government, NGOs, and media. U.S. trust in business fell by eight points to 46 percent--placing the world's largest economic power within five points of last-place Russia--and decreased in government by six points to 40 percent, putting the U.S. among the bottom four countries with the least trust in government. In the Trust composite score, an average of a country's trust in all four institutions, the U.S. also fell to fourth from the bottom, while three years ago, it was in the top four."
One slightly bright spot for the nonprofit sector is that the Trust Barometer shows that NGOs are now trusted as much as business in emerging markets and more trusted than business in developed markets.
The conclusion of the Barometer report is that the landscape has changed for all institutions, and especially so for businesses. The most important factors underlying trust in corporations are quality of product, trust, transparency, and employee welfare. More than 75% of stakeholders think that business should create shareholder value in a way that aligns with society's interests, even if that means sacrificing shareholder value.
While the report paints a glum picture for the place business currently occupies within the heart of American consumers, it may be that we are on the cusp of a golden age of corporate social responsibility as corporations start to come to grips with modern public sentiment
On the other hand, The Economist reported on another part of the Edelman Barometer research. The public relations firm asked members of the "informed public" what they thought of renowned economist Milton Friedman's famous line that "the social responsibility of business is to increase its profits."
The results ranked countries on how much their informed citizens agreed or disagreed. The UAE ranked first with more than 80% of those surveyed falling into the pro-Friedman camp; the U.S. ranked 9th with about 58% still clinging to Friedmanism; and the most benign countries in regard to CSR were China, Brazil, Germany, Italy, and Spain with less than 50% Friedmanites.
What do you think? Are we on the cusp of a golden age in CSR or do we sit on the edge of a volcanic crater into which we may still fall?
Related:
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- Corporate Social Responsibility (CSR) - a Definition
- 5 Lessons in Corporate Social Responsibility from TOMS Shoes
- Beyond Cause Marketing: Emotive Customer Bonding
Photo: Edelman Trust Barometer 2011
Comments
The Chinese Government gets result by managing its economy; therefore received the highest governmental trust ranking of 88% in the 2011 Edelman Trust Barometer®. The U.S. Government may not even deserve the 40% rating because it has done little if nothing to combat China’s innovative beggar-thy-neighbor strategy!
The 3 middle-class-relevant deficits, namely the leadership, trade and savings deficits are most causal to our current economic plight, while the fiscal deficit is primarily the result (effect) of the first three.
The United States’ trade gap is the proverbial “leak-in the-dike” with its de-simulative effect on our recovery. In November 2003, Warren Buffett in his Fortune, Squanderville versus Thriftville article recommended that America adopt a balanced trade model. The fact that advice advocating balance and sustainability, from a sage the caliber of Warren Buffett, could be virtually ignored for over seven years is unfathomable. Media coverage that China has kept it currency undervalued is a gross understatement, it has actually been keeping the U.S. dollar over-valued; which adversely affects all U.S. trade with ALL U.S. trading partners, not just trade with China
The Leadership deficit can be best addressed with campaign financing reform that really works. The savings deficit can be best addressed with increased productivity, similar to Japan post-WWII economic miracle pioneered by W. Edwards Deming, an American statistician and replacing federal employment and most federal income taxes with a federal consumption tax, like those used by most industrialized countries, except the United States.