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1. Insights
Strategy Documents
I16/2012
Reputation
Global Trust in Institutions
and Businesses Down,
but Trust in Peers
and Experts Up
The crisis is eroding the credibility of the system. Interestingly, only trust in
the mass media is still growing and gaining higher positions in the global trust
barometer rating, prepared annually by Edelman. NGOs are regarded as the
institutions that enjoy the maximum level of approval on the part of citizens.
However, even their positions in the rating are declining.
The consequences of the financial and economic It is noteworthy that the sector of the mass media
crisis that started in 2008 with the bankruptcy of – when the results of all countries are viewed
the financial giant Lehman Brothers and sub-prime aggregately – has also improved its positions in
mortgages in the USA, and subsequently spread the trust rating. According to Alan VanderMolen,
to the European markets – is making a clearly President and CEO of Edelman’s Global Practices,
negative impact on the level of trust in institutions this change may be due to the contribution made by
and businesses reported by people on the global the mass media in the analysis and education of the
level (institutions include governments and even general public about the causes of the current crisis
NGOs, which are still the most trusted institutions as well as reporting important cases of corruption,
but are for the first time losing their positions in such as in India. These merits evidently outweighed
the Netherlands, Sweden and Russia). the scandals around the mass media, such as the
Murdoch case in the United Kingdom.
The immediate circle of individuals – their friends
and families – as well as experts on different subjects,
such as scientists and academics are the ones who Major fall of trust in governments
inspire confidence and enjoy credibility. This since the launch of the rating
phenomenon is probably reinforced by the advance The North American communication and PR
of social networks and the digital boom 2.0. consulting firm Edelman launched its global study
This document was prepared by Corporate Excellence and contains references, among other sources, to the statements made by the
President and CEO of Edelman’s Global Practices Alan VanderMolen and Edelman’s CEO for Spain Miguel Ángel Aguirre during the
presentation of the Edelman Trust Barometer 2012 in Madrid, on January 26, 2012.

2. Global Trust in
Globally, reduces confidence in three of the four institutions, only increases the
Institutions and confidence in the media
Businesses Down,
but Trust in Friends
and Experts Up TRUST IN INSTITUTIONS
2011 56 %
Informed Public 53 %
52 %
2012 47 %
Informed Public
43 %
2012 38 %
General public
Government Business
61 %
58 %
49 % 52 %
50 %
“The imme- 46 %
diate circle
of individu-
als – their
friends and Media NGOs
families –
as well as
Source: Edelman Trust Barometer, 2011.
experts on
different
in 2000. The study covers 25 countries and is based countries, Nordic countries, Latin America, the
subjects, on online interviews with the sample of 1000 Netherlands and Italy.
such as sci- people in each country, and an additional sample of
700 people regarded as informed public (500 in the Finally, the level of trust in business leaders is higher
entists and USA and China, and 200 in other countries). than in politicians. Again, the leaders of distrust in
academics public managers are European countries, with Italy
The study analyses, for example, the trust in and Spain on top of the list. Globally, distrust is the
are the ones governments in different countries at the times main motif of the general situation, with more and
who inspire when governments do something that is regarded more countries finding themselves in the red zone
by the citizens as correct and good. In 2012, only (not trusted) of the list – including Sweden, South
confidence the Netherlands, Sweden, Canada and some Asian Korea, France, Japan and Spain. On the other
and enjoy countries managed to surpass 50% threshold of extreme, still hanging on in the blue zone (trusted),
trust, which means that the citizens trust their are the emerging Asian economies, Latin America
credibility” governments. The most dramatic declines compared and the Netherlands.
to the previous year have been observed in Brazil,
Japan and Spain. On the global level, this is the
most significant decline since the launch of the More trust in the technological sector,
barometer. However, paradoxically, this distrust less trust in the financial sector
coexists with the reported need for greater regulation Banks and financial entities are still the least
and control on the part of public administrations. trusted business area according to the respondents,
with results even lower than in 2011. On the other
On the other hand, the study also analyses the hand, the technological sector has remained the
trust in the business community: many developed most trusted industry for six years running. Former
economies report double-digit decline of trust leader of this rating, telecommunications, fell to
in companies, mainly in the largest economies no.5, replaced by the car-making sector. Only the
of the euro zone, such as Germany, France and consumer goods sector managed to improve its
Spain. However, on the global level trust in position in 2012, becoming the fourth most trusted
business is gradually recovering from the record industry globally.
low levels of 2008. And again, Asian economies
are in a good shape – with an exception South The power generation sector suffered a significant
Korea – as well as Anglo-Saxon non-European decline, especially in Japan in the wake of the nuclear
Insights 2

3. Global Trust in
Growing skepticism, almost twice as many countries are now skeptical
Institutions and Most EMEA countries are ‘skeptics’ in 2012
Businesses Down,
but Trust in Friends
and Experts Up 2011 2012
GLOBAL 55 GLOBAL 51
Brazil 80 > China 76
UAE 78 UAE 68
Indonesia 74 Singapore 67
China 73 India 65 OPTIMISTIC
Netherlands 73 Indonesia 63
Mexico 69 Mexico 63
Singapore 67 Netherlands 61
Argentina 62 Canada 58
India 56 Italy 56
Italy 56 Argentina 54 NEUTRAL
Canada 55 Australia 53
South Korea 53 < Brazil 51
Sweden 52 Sweden 49
“Traditional Japan
Australia
51
51
> U.S.
South Korea
49
44
information Spain 51 > Poland 44
channels France
Poland
50
49
> United Kingdom
Ireland
41
41 SKEPTICS
remain the Germany 44 < France 40
trust U.S.
United Kingdom
42
40 <
Germany
Spain
39
37
leaders. Russia 40 < Japan 34
However, Ireland 39 Russia 32
they de- The combined result is the average trust of a country in the four institutions. Public informed of 25 to 64 years in an
overall total of 20 countries (excluding Argentina, Hong Kong, Malaysia, Singapore and UAE) and in 23 countries.
monstrate
Source: Edelman Trust Barometer, 2011.
the slowest
growth. The catastrophe that also ricocheted off to Germany and information sources, says Miguel Ángel Aguirre,
growth of caused a loss of trust the power generation industry Edelman’s CEO in Spain.
official and there for the same reason. This decline, as well as
the decline of the financial sector, is reported in It appears that top managers and official spokespersons
corporate all countries of the study. Pharmaceuticals lose of governments, institutions and companies are less
information positions as well, while the drinks sector managed
to preserve its positions.
credible according to the global public opinion, while
technical experts, academics and scientists enjoy more
sources has trust. The close circle of an individual – his or her family
slowed down Overall, in terms of percentages, the global level
of trust in the sectors remains in the same range
members, colleagues and friends, grouped under the title
“someone like you” – are the ones whose losses of trust
as well” between 45% and 80%, with the changes that have have been minimal in the general context of distrust.
been discussed above. As for specific regions, the
countries that report lowest trust levels in the most As for trust in advice and recommendations, the
affected sectors (finance and power generation) are most credible sources of information for taking
the same (Germany, France and South Korea). decisions are experts, who again top the rating of
trust, followed by colleagues and friends (24%).
Employees of companies (24%) are the ones who
The close and personal wins more than others have increased their trust capital
over the distant and official in the eyes of respondents. CEOs (-18%) and
One of the most important changes took place in politicians (-15%) have suffered the most dramatic
recent years in trusted channels of information. fall in the history of the Edelman Barometer.
Television appears to be the big loser – especially
in China – as a source of information that lost trust, Coming back to information channels, microblogs
followed by newspapers, radio and magazines. such as Twitter and social networks like Facebook
are the real trust stars (75% more trusted compared
On the whole, the traditional information channels to the previous year), and to a lesser extent, other
remain the trust leaders, but their growth has slowed digital sources (forums, media, etc.), especially in
down, as well as the growth of official and corporate countries like Spain and China.
Insights 3

4. Global Trust in
Reputation brings credibility
Institutions and
Businesses Down, Reputation and trust are synonymous
but Trust in Friends
and Experts Up Company in the untrusted Company that is trusted
57%
Believe a
negative information
after hearing it
1 or 2 times
51%
Believe a
positive information
25% after hearing it
1 or 2 times
15%
Believe a positive feedback Believe negative information
after hearing it 1 or 2 times after hearing it 1 or 2 times
Source: Edelman Trust Barometer, 2011.
Skepticism requires repetition of messages layoffs and growing unemployment. However,
In the moments such as this, due to a higher paying attention to the opinion of consumers and
level of social skepticism, it is more important innovation are important issues as well.
than ever that companies and governments make
communications more frequently and establish The key to achieving recognition in future in order
a much more intensive relationship with their to launch initiatives and become market leaders
audiences. Edelman’s barometer shows that citizens seems to be in becoming the leader in the social
need to hear the same message 3 to 5 times before context, which implies active listening, excellent
they start treating this message as truthful. treatment of the employees, valuing people as
they are, protecting the environment and ethical
The growing disparity of sources and media behavior, in addition to offering great products or
emphasizes this trend, showing that persistent top-quality services, having access to great resources
communication leads to the consolidation of an idea or getting the best positions in the rankings.
in the public mind and overcomes the contradictions
frequently caused by contrasting messages.
In this framework, companies are a potential
platform for restoring trust. There is a big difference
These messages should transmit leadership and
between attitudes towards companies with a good
visualize this leadership in order to contribute to
reputation and companies with a bad reputation. If
overcoming the current crisis. This means that the
one trusts a company, one will believe new positive
messages should be devised in the form of specific
information about it and will give the benefit of a
ideas and projects rather than based solely on the
doubt to new negative information. If a company is
economic and business results.
not trusted, negative information will be accepted
as truthful immediately. According to the results of
Conclusion: an opportunity the 2011 Trust Barometer, in the case of a company
to meet the expectations with a bad reputation, 57% of people trust negative
On the one hand, general distrust in companies and information after hearing it one or two times, and
institutions is being translated into growing trust only 15% of people trust positive information
in channels and persons in the immediate circle after hearing it one or two times. In the case of
of the individuals. On the other hand, companies a company with a good reputation, 51% believe
may use this loss of trust as an opportunity to positive information and 25% believe negative
respond to the expectations – something that has information about this company.
not been seen as satisfactory by the stakeholders
and the society in general. Companies with a good reputation may act as a
launching pad for the process of restoring trust.
The difference between what is considered important In this sense, companies, being a part of the civil
for companies to do and what is done in reality society, are in a better position than governments.
remains significant, especially when it comes to The second stage will start when trust will
working conditions of the employees – an issue, the transfer from the civil sector to governments and
importance of which is second only to the massive public institutions.
Insights 4

5. ©2012, Corporate Excellence - Centre for Reputation Leadership
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the professional management of reputation as a strategic resource that guides and creates value for companies throughout the world.
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