TrustTalk - It's all about Trust

We interview Steven Heywood, General Manager of Edelman in The Netherlands, known for the annual Edelman Trust Barometer. The 2021 findings of the Edelman Trust Barometer show an alarming divergence in trust between two distinct groups of people, the “informed public” and the mass population, which has a much lower level of trust. A minority of those surveyed practice “good information hygiene’ which includes news management, avoiding echo chambers, verify information and not amplifying unvetted information. Steven explores how this global “infodemic” has driven trust in all news sources to record lows with social media and owned media the least trusted. He talks about the weaponisation of fake news, the need for Action Communications, and how brands should take real steps to change the way they service their customers and take part in society.

Interview with Paul van Lange, Professor of Psychology at the Vrije Universiteit Amsterdam on trust. He discusses the importance of social contact, which he and his co-author Simon Columbus frame in terms of “Vitamin S”, arguing that brief encounters with strangers can yield some happiness, an insight that is important for (young) adults during this era of COVID-19 lockdowns. He views trust in terms of accepting dependence on others and anticipating some critical level of pro-sociality from others. Norm violations by other people pose a challenge to trust, including norm violations enacted by strangers. Yet most people have developed a capacity to navigate to a relatively high level of trust, a default that we are often are not aware of. Like well-being, we start to ponder about trust in others when it is seriously challenged by others’ norm-violations. Various other intriguing questions are addressed. For example, what are the benefits of one-on-one interactions in pairs over interactions in larger groups? Why do we seek interactions with like-minded people? And why do we sometimes disclose more private information with a taxi-driver than with a friend?

Interview with two partners of EY, the global accounting and consulting firm, Will Weerts and Tonny Dekker. Risk management is a key element of any management role. The ability to identify risks before they arise, and then plan a strategy to deal with them is paramount. The consequences of not doing this could be a business failure.

In this interview, both reflect on the importance of risk management, the challenges, and the opportunities, and its relation with trust. They talk about the “Three Lines of Defence model”, IP risks, and the importance of resilience. They describe the “Catch-22” situation risks managers find themselves in, as risk management is too-often treated as a matter of compliance., whereas internal audit is -especially in the US - focused on financial control.

Today’s guest is Kent Grayson, associate professor of Marketing at Kellogg School of Management and co-founder of The Trust Project. Many academics study trust but there is a need to bridge the language used by academics and business people and practitioners. Although every discipline has a different perspective of trust, when you pass the language, we are talking about the same thing: what encourages someone to make themselves vulnerable and to rely on another person for something important.

Marketing is not just advertising, or how to sell a product or service via social media or communication. At business schools, students learn that marketing communication is the final step in the marketing process. It is about understanding the target customer sufficiently well, their goals, problems, or needs. Trust is essential for that understanding. You have to find a way to trust what the consumer is telling you so that you can be confident that your solution will solve their needs.

Generation Z, when asked are there any brands or business you trust, they will talk passionately about a handful of organizations. Kent speaks about the “wack-a-mole” challenge in marketing, the efforts of truthfully communicate with your customers, the role of influencers, about honesty and sincerity, and the relation between trust and transparency. Trust is about making sure you understand the other party's motives, that you believe they have your best interests at heart, and telling you the truth and keep your promises.

Interview with Harvard Professor Barry R. Bloom. He speaks about trust and public health aspects and of the Covid-19 virus vaccines, its development, and distribution, about the differences with developing vaccines against diseases like polio, influenza, and pneumonia. He blames social media for causing distrust as people think that science has been fast in producing a vaccine in just 11 months since we first experienced the virus. He points out that more than 10 years of investment in science are underlying the new vaccines (“there is no vaccine for misinformation”).

From a public-health perspective, the nationalistic races between countries that can vaccinate first are completely irrelevant. Vaccination is not just a matter of implementation as careful research and data are necessary to keep up with new mutants of the vaccine, as are questions about who can produce the vaccines, syringes, and other equipment and who can effectively distribute the vaccines and who can do coaching, and providing information on who gets the first and second shot, all things that are very tough to organize, due to the fact that each state and country have their own health systems. This requires a lot of planning, which is not a trivial undertaking.

The new mutant variations of the virus that appeared in the UK, South Africa, Nigeria and parts of Europe lead us into a “Darwinian game”. Those vaccine variants may cause a dramatic rise in infections, but the good news is that given current science pharma companies need potentially as short as 6 weeks to produce new vaccines that protect against those new virus mutations.

Public health is good at dealing with science and molecular biology and genetic engineering, but where it is not so good at is the science of human behavior. His biggest concern is how local and national leaders can inspire trust while facing distrust anywhere in the world and how they might be unable to motivate people to change their behavior and to protect themselves and everyone else and at the same time realize that until everyone is protected we all remain susceptible to the virus.

Interview with Hélène Vletter-van Dort. She is a professor in Financial Law and Corporate Governance at Erasmus University in Rotterdam, Netherlands. She is a member of the Supervisory Boards of financial services company NN (formerly known as Nationale Nederlanden) and The Dutch Public Broadcasting Organization NPO as well as Chair of the Supervisory Board of Intertrust NV. She speaks about commitment and culture and is inspired by Ben Horowitz’s book: “What You Do is Who Your Are”. At the center of her work is the importance of corporate culture and the relationship with corporate values. Culture is not what is on a corporate website but what really lives in a company. She talks about UBER, a company that went through a thorough self-reflection on its corporate culture and her experience with a hospital where she was overseeing the board.

Interview with Jaap Winter, one of Europe’s leading experts on corporate governance on the importance of trust. He contributed to the first corporate governance rules in The Netherlands, “Code Tabaksblat”. He talks about the “Agency theory” and “substantial variable pay” arrangements for corporate executives, about acting in self-interest and how the wrong incentives create mistrust, which, in the words of Harvard professor Michael Jensen, would only led agents (executives) to “lie twice”. Trust is on the other side of a bureaucratic model, but trust is not enough, discipline is important. He reflects on the two models of INSEAD and London School of Economics professor Sumantra Ghoshal: the Dark-Calcutta model and the Spring-at-Fontainebleau model. Trust is easier to establish if there is proximity, something that often lacks with shareholders who are far away the company, almost anonymous. In that situation it is difficult to establish trust. There is a need for systems and controls, yet he is not in favor to answer to financial and other crises with even more rules and regulations, rather building an international reflective mission leading to a new corporate culture, like Siemens did after the bribery scandal that hit the company in 2008. For that you need discipline and a core element is trust, built through honesty and speaking “face-to-face”, “as if one would speak with a friend” (citing Exodus 33:11 where God speaks directly to Mozes).

Dr. Balázs Bodó, researcher at the Institute of Information Law at the University of Amsterdam, describes 3 dimensions of “technology-mediated trust”. The known and unknown risks of new technologies, how we interact with these technologies, and whether they are trustworthy. Global institutions – moving at a slow pace - have failed to establish trust that they are capable of handling worldwide challenges like climate change, mass human displacement, and global pandemics, or other forms of crises. This lack of international leadership leads to a trust crisis. The emergency of new technology platforms – or “trust mediators”- facilitate coordination and establish trust between strangers through various methods. Platforms, such as Uber, or Airbnb manage reputations; blockchain technologies try to minimize the need for trust; AI systems promise to reduce future uncertainties. Balázs touches on the relationship between risks and trust and the “costs of trust”. He contrasts technologies where trust was verifiable, such as the workings of nuclear reactors, and digital technologies where it is much more difficult to establish their trustworthiness. Unlike global organizations and governments, technological trust mediators may be able to establish trust among users, but we must think about how they can do it in a verifiable and trustworthy manner.

Interview with Marike Westra, Chief Communications Officer at COFRA, a privately held 6th generation family business on the central role of trust in communications. She believes communication is fundamental in creating trust in both business and brands. The interview touches upon the role of social media who have “democratized” society, even if bad actors try to misinform, on the importance of transparency in doing responsible business. She reminds us that things that are closer to you, you tend to trust more. Marike further talks about how employers can influence the direction of their company and the challenges in keeping trust in brands and the importance of data: “we should be data-informed, not data-driven”. Transparency in communications is key to trust.

Interview with management consultant and former SVP at Royal AholdDelhaize, Kiki Stiemer. She talks about her research while at INSEAD, the role of trust in relation to unsolicited advice senior managers (CEO’s and Board Members) receive from an employee or external advisor. How does the famous trust formula of Maister, Green & Galford (in: “The Trusted Advisor”) work out in case of unsolicited advice? How do managers react when they receive advise they did not ask for? In her research Kiki Stiemer interviewed Netherlands CEO’s of large companies and noted the difference between their responses and the hard reality. In this interview she touches on the role of trust, as well as the importance of credibility, reliability, intimacy and self-orientation when giving advice.