2012

Edelman Trust Barometer Executive Summary

2012 Trust Barometer: Business Can Earn the License to Lead

In 2008-2009, in the wake of a recession that saw large, global companies such as Lehman Brothers and AIG collapse, trust in business imploded. Government stepped in with bailouts and new regulations. But in 2011, government became paralyzed by the politics of extremism and endless haggling and the public lost confidence.
The 2012 Edelman Trust Barometer sees an unprecedented nine-point global decline in trust in government. In twelve countries, it trails business, media, and nongovernmental organizations as the least trusted institution. This has pushed more countries into the distruster category (figure 1). Political brinksmanship on the debt ceiling in the United States, dysfunction on bailouts in the European Union, corruption in Brazil and India, and a natural disaster in Japan drove the downward trend. Business leaders should not be cheered by governments ineptitude, especially as trust in the two institutions tends to move in sync. There is still a yawning trust gap for business, as evidenced by one half of the informed public respondents (49%) saying government does not regulate business enough. Yet what most stakeholders want from government consumer protection (31%) and regulation ensuring responsible corporate behavior (25%) are actions business can take on its own. It makes good business sense for business to broaden its definition of leadership. It cannot be seen as acting solely in self interest, but rather must execute on both the fundamentals of profit and societal good. To earn the license to lead, business must do the following:
* The Wall Street Journal, January 13, 2012

BUSINESS: CAN EARN LICENSE TO LEAD

2008-2009

Low trust in business and CEOs

Business has exibility and speed

Business leaders more trusted than government leaders

business has advantage in 24 out of 25 markets

THE DYNAMIC OF TRUST BETWEEN BUSINESS & GOVERNMENT

Call for increased regulation

protection from irresponsible behavior sought

2011

Dwindling trust in government

policy paralysis

Government responds

Exercise principles-based leadership instead of rules-based strategy. Business should not go to the edge of what is legally permissible but rather stay focused on what is beneficial both to shareholders and society. Recognize that the operational factors responsible for current trust in business wont build future trust. Our research shows that current trust levels are built on consistent financial returns, top management, and innovative products. However, engagement-oriented behaviors that are more societal in nature, such as treating employees well, putting customers ahead of profits, and transparency, are vital to building future trust (see pages 9 and 10). Practice radical transparency. Speak first to employees whose credibility rose dramatically (page 7) enabling them to drive the continuing conversation with their peers. Establish operational and societal goals and report on them regularly. Shape the public discourse on issues like fracking and charging fees for financial services. Explain the advantages for customers. Business must exhibit its role as job creators, managers of responsible supply chains, and community partners that help build infrastructure. Business is a force for good. Yes, there are risks in bold decision-making, in telling hard truths, and in structuring business goals that serve investors and society. But the bigger risk for business is in waiting for government to act; some business leaders are clearly aware of that fact. In the Wall Street Journal, Paul Polman, CEO of Unilever (disclosure: Edelman client) recently said: Our version of capitalism has reached its sell-by date. Never has the opportunity for business to help shape a more equitable future been so great.*

Government Suffers Steepest Trust Decline in Barometer History

The majority of countries surveyed do not trust their government to do what is right
Throughout the world, people blamed their governments more than any other institution for the financial and political crises they endured in 2011. In seventeen of the 25 countries surveyed, government is now trusted by less than half to do what is right (figure 1). In Europe, trust in government dropped by more than ten points in France, Spain, and Italy. In Latin America, Brazil experienced a 53-point plunge. In Asia, South Korea and China suffered declines of 17 and 13 points, respectively. In Japan, trust in government dropped by 26 points driven by the catastrophic earthquake that struck the country in early spring. (For more on Japan and the domino effect of the governments poor response to the disaster, see page 5.) Trust in government did hold steady in a number of countries. Germany, though well below the midpoint, stayed firm at 33 percent, while India cleared the midway mark (53 percent) for the first time. In the United States, trust remained stable despite all the political discourse. Singapore registered the third-highest government trust level at 73 percent. Trust saw a significant increase in Ireland, where elections brought in a new government. Governments inability to effectively manage the political and financial crises of 2011 also had a severe impact on the credibility of government officials. Not surprisingly, their decline mirrored the historic drop in trust in the institution of government. In nearly every country surveyed, the general population says it trusts government leaders less to tell the truth than it does business leaders (figure 4, page 3). Their credibility has taken such a beating that they are now the least trusted spokespeople in the world. (For more on the steep decline in credibility levels of government officials see page 7.)

Figure 1: Biggest decline in trust in government in Barometer history

How much do you trust government to do what is right?
-Trust +Trust
GLOBAL

Trust Steady
88% 78% 88%

-Trust
85% 75%

77% 73% 64% 62%

52% 43%

75%

61% 52% 47% 54% 50% 42% 45% 49%

62%

62%

50%

56% 53% 52% 44% 35% 43% 40% 33% 33% 43% 38%

51% 43% 40%

49%

42% 35%

39%

26% 20%

28%

31%

33%

36% 31% 25% 20% 32%

N/A

N/A

2011 GLOBAL

2012

2011

2012 COUNTRIES

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics ages 25-64

Figure 2: Distrust is growing: more countries are now distrusters

2011
GLOBAL
Brazil UAE Indonesia China Netherlands Mexico Singapore Argentina India Italy Canada South Korea Sweden Japan Australia Spain France Poland Germany U.S. U.K. Russia Ireland

2012
55
80 78 74 73 73 69 67 62 56 56 55 53 52 51 51 51 50 49 44 42 40 40 39

GLOBAL
China UAE Singapore India Indonesia Mexico Netherlands Canada Italy Argentina Australia Brazil Sweden U.S. South Korea Poland U.K. Ireland France Germany Spain Japan Russia

51
76 68 67 65 63 63 61 58 56 54 53 51 49 49 44 44 41 41 40 39 37 34 32

TRUSTERS

NEUTRAL

DISTRUSTERS

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics ages 25-64 Composite score is an average of a countrys trust in business, government, NGOs and media

2 0 1 2 | T r u s t Bar o m et er

Business Still Has Its Own Hurdles to Clear, Especially in Developed Markets
Despite better standing than government, people want more regulation of business
Driven by steep drops in countries in the heart of the eurozone economic crisis, trust in business fell three points globally to 53 percent. Spain, France, and Germany, down by 21, 20, and 18 points respectively (figure 3), werent the only mature economies moving squarely into the distruster category. South Korea recorded a 15-point drop in trust in business (for more on South Korea, see page 6). In the majority of countries, trust in business held steady, with several countries in Asia staying well above 50 percent Indonesia (78 percent), Singapore (66 percent) and India (69 percent). The U.S., however, was among the countries where trust did not go above the 50-percent mark. China was the lone country to see a significant boost in trust in business, rising from 61 percent to 71 percent. The uptick could be attributed to the profitability of state-owned enterprises and the growth of the countrys auto industry, which is now the largest in the world. Despite the fact that in all but one of the countries surveyed (Singapore), government leaders are less trusted than their business counterparts to tell the truth (figure 4), nearly half of global respondents still want more government regulation of business. The regulations they are calling for however, are changes business can step up and implement on its own. Business has the means to act with speed and dexterity to right its own ship, while maintaining the ability to be a force for good and an engine for profit.
3

Figure 3: Several mature economies see double-digit drops in business trust

How much do you trust business to do what is right?

-Trust +Trust
GLOBAL

Trust Steady
80% 78% 81% 77% 78% 74% 63% 57% 53% 46% 43% 44% 38% 47% 65% 67%

-Trust
81%

71% 61% 56% 53% 56% 50% 50% 46% 57% 54% 54% 52% 46% 44%

70%

69% 67%66% 64% 62%

63% 52% 46% 48% 53%

65%

50%

47%

41%41%

31%

34% 28%

32%

N/A

N/A

2011 GLOBAL

2012

2011

2012 COUNTRIES

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics ages 25-64

Figure 4: Government leaders less trusted than business leaders to tell the truth
Do you trust leaders to tell you the truth?

73% 69% 69% 66% 66% 65% 60% 53%

% who do not trust them to tell the truth

50%
46%

51% 44%

48% 42%

50%

51%

50% 47% 46% 46% 46% 43% 43% 41% 40% 36% 34% 30% 28% 29% 24% 17% 17% 15% 14% 9%

40% 36%

38% 34%

36%

34% 26%

27% 23% 21% 13% 14% 10% 10%

24%

11% 5%

Business Leaders

Government Leaders

Do not trust them at all; General Population

NGOs Remain Most Trusted Institution Globally, Despite Decline

Media, the only institution to post an increase, benefits from diversification of options
For the fifth year in a row, NGOs are the most trusted institution in the world, and in 16 of the 25 countries surveyed, more trusted than business. Trust in NGOs has reached a record high of 79 percent in China among 35 to 64-year-olds (figure 6). This signals a number of changes taking place within the country, including the evolution of its market. The growth in NGO trust, a by-product of becoming the worlds second-largest economy, also indicates that Chinas people and media outlets are breaking long-standing traditions and now relying more heavily on non-traditional sources for information. Since 2009, trust in NGOs has surged in India to 68 percent among 35 to 64-year-olds (figure 6). But some countries are not as trusting of NGOs. In markets that dealt with crises and scandals, such as Brazil (down 31 points), Japan (21 points), and Russia (14 points), NGOs suffered severe drop-offs in trust (not depicted here). The institution of media rose above 50 percent in trust for the first time and is the only institution the Barometer studies that saw an increase (figure 5). Media experienced significant regional upticks in India (20 points), the U.S. (18 points), the UK (15 points), and Italy (12 points). As the media landscape continues to dimensionalize and deliver a wider range of options, it is becoming more trusted and valued (for more on the evolution of the media landscape see page 8). The media also did a strong job this past year of covering the financial turmoil throughout the European Union as well as numerous corporate crises, including Bank of America trying to impose a debit card fee, the Netflix/Qwikster snafu, and the India telecoms scandal. Media is also skillfully using social networks to help extend the life of its stories and keep its brands relevant.

Figure 5: Trust in three of four institutions declines; only media rises

How much do you trust the following institutions to do what is right?
61%

58% 50%

56%

53% 47%

NGOs

BUSINESS

49%

52% 46%

52% 43% 38%

MEDIA

GOVERNMENT

2011 Informed Public

2012 Informed Public

2012 General Public

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics 25-64 and General Population

Figure 6: NGOs surge in China and India

How much do you trust NGOs to do what is right?
80% 75% 70% 65% 60% 55% 50% 48% 45% 40% 35% 36%
31% 52% 48% 54% 68% 79%

30%

2001

2002

2003 U.S.

2004

2005

2006

2007

2008 China

2009

2010

2011 India

2012

UK/France/Germany

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics ages 35-64

2 0 1 2 | T r u s t Bar o m et er

Japan and the Fragility of Trust

Earthquake and subsequent nuclear disaster expose weakness of countrys command-and-control method of communications and how easily trust can be lost
There is little mystery behind the precipitous drop in trust in Japan, historically a country with steady trust levels. The 8.9 off-shore earthquake that hit the country in March 2011 set off a chain of events, including a nuclear meltdown at the Fukushima power plant, that all but destroyed peoples trust in government, officials, and five major industries. Facing one of its largest environmental and political crises ever, Japan failed to deliver the leadership and protection its people needed. Trust in three of the four institutions we survey suffered double-digit decreases for the first time ever (figure 7a). As the nuclear crisis worsened, the governments absence of leadership, and the local utilitys poor transparency revealed massive shortcomings in the countrys command-and-control approach to communications. The Olympus Corporation scandal also raised concerns about corporate governance in Japan. Five of 11 major industry sectors saw dramatic drops (figure 7b). Not surprisingly, energy suffered the worst blow with a 46-point plunge. In Japan, trust in the media industry tumbled by 21 points, while banks and financial services fell by 20 and 17 points, respectively. Not depicted here is a 17-point decline in trust in the telecommunications sector, which fell to 58 percent. Trust in credible spokespeople dropped across the board (figure 7c). For government officials it nearly vanished, dropping from 63 percent to 8 percent. Unlike most other mature markets in which CEO credibility fell but that of regular employees rose, both took a pounding in Japan, dropping by 43 points each. Information sources are less trusted too, in particular TV, which dropped by 26 points (figure 7d). Not pictured here, but also recording declines is trust in socialnetworking and micro-blogging sites. Both enjoyed significant increases in the overall study (figure 13, page 8).
5

Figure 7: The fragility of trust: Focus on Japan

a) Trust in institutions
Business
53% 47%

Media
48%

-12
36%

NGOs
51%

-21
30%

Government
51%

-26
25%

2011

2012

b) Trust in industries
Energy 29% Media 33% Financial Services 38% Banks 51%
2011 2012

75% -46 54% -21 55% -17 71% -20

c) Credible spokespeople
-23 65% -38 70% 67% 59% -30 42% 32% 24% 22% 18% -17 39% 48% 40% -26 -43 -43 63% -55

16%

14% 8%

Technical Expert

Academic or Expert

CEO

A Person Like Yourself

2011

NGO Represent.
2012

Regular Employee

Financial Analyst

Government Ofcial

d) Trust in information sources

-16
53%

Business
47%

-26
48%

Media

-13 -12
36% 51%

NGOs

-21
30%

Government
51%

-13

-26
25%

Newspapers

TV
2011 2012

Radio

Magazines

Informed Publics ages 25-64

Banks and Financial Services Remain Least Trusted; Technology on Top for Sixth Year
The financial industry suffers as Europes sovereign debt crisis continues
While Japan shows how easy it is to lose trust, the financial sector exemplifies how hard it is to gain it. As the financial situations around the globe remain bleak, banks and financial services stay the two least trusted industry sectors for the second year in a row (figure 8). On the opposite end of the trust spectrum, technology, for the sixth consecutive year, is the most trusted. The steady introduction of more powerful tablets and smart phones has helped keep the tech sector in good standing in both developed markets such as the U.S. and the UK and in developing ones like China and India (figure 9). The financial meltdown throughout the eurozone has had a particularly negative impact on trust in countries like Germany, France and Spain (figure 9). The persisting negative economic climate is going to make the recovery of trust in that region even more difficult in 2012. A severe loss of confidence in the financial services industry also occurred in South Korea where trust fell 25 points. South Korea was the setting for a remarkable slide in trust across every industry sector except automotive and technology. A few of the biggest decreases happened in telecommunications (down 32 points), financial services (25 points), banks (24 points), and media (16 points). Despite the fact that South Korea was less affected by the global economic downturn, there is still a high level of uncertainty its people are facing. This, along with the intensified polarization of wealth, diminishing disposable income and a hike in consumer prices, could be driving this drastic drop in trust. In Germany, the energy sector felt the effect of Japans nuclear disaster, recording a 24-point drop in trust, equal only in size to the hit the auto industry took in that country. Energy also saw a steep decline in France and South Korea.

Figure 8: Technology remains on top; finance sector still at bottom

How much do you trust the following industries to do what is right?

2011
Technology Telecommunications Automotive Food and beverage Pharmaceuticals Energy Consumer packaged goods Brewing and spirits Media Banks Financial services 80% 67% 67% 64% 61% 60% 57% 57% 52% 50% 48%

2012
Technology Automotive Food and beverage Consumer packaged goods Telecommunications Brewing and spirits Pharmaceuticals Energy Media Banks Financial services 79% 66% 64% 62% 60% 59% 56% 53% 51% 47% 45%

Responses 6-9 only on 1-9 scale; 9 highest; Informed Publics ages 25-64 in 20 countries

Figure 9: Distrust in finance and energy spreads; tech remains stable and strong
How much do you trust the following industries to do what is right?
100% 90% 80% 70%
64% 75%

Financial Services

Energy

Technology
+10
83%

98% 91%

93% 92%

-46
67%

-25

-20

74%

-15
73% 71% 73%

60% 50% 40% 30% 20%

14% 32% 52%

-32
45%

59%

-26
39% 29%

48%

-24
47%

-18

24% 20% 19%

10% 0%

Germany France 2011

Spain

S. Korea 2012

Japan

Germany France S. Korea 2011 2012

UK

US 2011

India

China 2012

Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64

2 0 1 2 | T r u s t Bar o m et er

Government Officials Now Least Credible Spokespeople; CEOs See Record Drop
Dispersion of authority evidenced in rise in credibility of person like me and regular employee
As trust in government experienced its biggest decline in Barometer history, so too did the credibility of its officials. Only 29 percent of those surveyed view them as credible. Government officials, whose 14-point drop is their largest in Barometer history, are now the least credible spokespeople in the world (figure 10). In a separate look at how much the general population trusts government and business leaders to tell them the truth, government leaders resoundingly emerge as the less likely party to be transparent, with 46 and 27 percent, respectively, saying I do not trust them at all (figure 4, page 3). Business leaders were not immune to the increasing skepticism. The drop in the credibility of CEOs in mature markets such as the U.S., UK/ France/Germany, and South Korea fell more than or as dramatically as it did when the recession hit in 2008-2009 (figure 11). Overall, CEO credibility dropped 12 points to 38 percent, its biggest drop in Barometer history (figure 10). As government officials and CEOs become less a source of trusted information, people are once again turning to their peers. A person like me has re-emerged as one of the three most credible spokespeople, with its biggest increase in credibility since 2004 (figure 10). Seeing a similar rise in credibility are regular employees, who saw their number jump by 16 points. Smart businesses will take advantage of this dispersion of authority. They will talk to their employees first, and empower them to drive the conversation among their peers about the company and its role in society.
7

Figure 10: Credibility of CEOs and government officials plummets; peers and regular employees see dramatic rise
If you heard information about a company from one of these people, how credible would that information be?

2011
Academic or expert Technical expert in the company Financial or industry analyst

2012
70% 64% 53% 50% 47% 43% 43% 34%
Academic or expert Technical expert in the company A person like yourself Regular employee NGO representative Financial or industry analyst

68% 66% 65% 50% 50% 46% 38% 29%

Greatest increase since 2004

+ 22 + 16

CEO
NGO representative A person like yourself

Govt ofcial or regulator

Regular employee

CEO Govt ofcial or regulator

- 12 - 14
Biggest declines in Barometer history

Extremely credible and very credible; Informed Publics ages 25-64 in 20 countries

Figure 11: CEO credibility returns to low of 2009

If you heard information about a company from a CEO, how credible would that information be?
100% 90%
83%

80% 70% 60% 50% 40% 30%

22% 37% 37% 34% 23% 23% 18% 17% 17% 60% 44% 41% 32% 46% 44% 33% 66% 60% 59% 53% 49% 51% 68% 56% 46% 45% 35% 26% 26% 34% 28% 27% 22% 21% 63%

20% 10% 0% 2007 U.S.

2008 UK/France/Germany

2009 China

2010 India

2011 S. Korea

2012 Japan

Extremely credible and very credible; Informed Publics ages 35-64

Social Media Surges as Skepticism Rises

New media sees biggest rise in trust, jumping by 75 percent
This years Barometer once again looks at the number of times people need to hear something to believe it. Against the backdrop of increased skepticism, 63 percent say between three and five times (figure 12), which represents a four-point uptick over last year. In Japan, which now sits second from the bottom of the Trust Index, the number is 82 percent (see page 2 for the Trust Index). While traditional media sources are still the most trusted, the diversification of trusted media sources continues. In fact, social media, which consists of social networking sites, content-sharing sites, blogs, and microblogging sites, saw the biggest percentage increase (75 percent) in trust among media sources (figure 13). Online multiple sources, made up of search engines and news/RSS feeds also saw a jump of 18 percent. In the U.S., trust in all media sources rose, with major jumps in the perceived trustworthiness of television, radio, and newspapers as sources of information about a company (by 23, 13, and 11 points, respectively). In the U.K., those same sources increased by 25, 17, and 17 points, respectively. By contrast, in France and Germany, trust in television news and newspapers fell by ten or more points.
13%

China saw double-digit decreases in television as a trusted source, plunging from 74 to 43 percent. Newspapers in that country didnt fare well either (down by 20 points to 34 percent). But trust in social media jumped: micro-blogging sites and social-networking sites went from virtual distrust at just one percent each to being greatly trusted by a quarter (25 percent) and 21 percent, respectively a likely reflection of the rapid growth in social media usage within China. At the end of 2010, Weibo (the Twitter equivalent) had 60 million users. By the end of 2011, 310 million users were on Weibo, which broke major news stories, including the corruption of the Red Cross and a high-speed train crash.
5% ONCE (1) 14% TWICE (2)

Figure 12: Skepticism requires repetition

SIX TO NINE TIMES (6-9)

TEN OR MORE TIMES (10+)

6%

How many times in general do you need to hear something about a specific company to believe that information is likely to be true?
28%

35% THREE TIMES (3)

FOUR OR FIVE TIMES (4-5) Informed Publics ages 25-64 in 25 countries

63% THREE TO FIVE TIMES

Figure 13: People now trusting multiple media sources

How much do you trust each of the following places as a source of information about a company?

+10%
29%

32%

+18%
26% 22%

+75%
14% 8%

+23%
13% 16%

TRADITIONAL

ONLINE MULTIPLE SOURCES

SOCIAL MEDIA

CORPORATE

2011

2012

Trust a Great Deal; Informed Publics ages 25-64 in 20 countries

2 0 1 2 | T r u s t Bar o m et er

Neither Business nor Government Is Meeting Expectations

Wide gap seen between what is considered important for business and government to do and how they are actually performing
In this years Trust Barometer, we asked the general population a two-part series of questions to understand the gap between what is important to them and how well business and government are delivering against that. For business, we looked at 16 attributes that build trust and at eight for government. Both institutions show performance gaps, but the gulf is wider for government, which appears to be falling short on policy and execution. It records double-digit gaps in environmental protection, sound fiscal management, and frequent and honest communication (38, 46, and 49 percentage points, respectively) (figure 14). Business, on the other hand, is doing a slightly better job at closing the gap on operational factors like bringing innovative products to the market, and ranking on global best-of lists. The areas in which it has largely fallen short are more societal in nature. Sixty-four percent say that treating employees well is important to building their trust in a company, but only 27 percent say that business is doing a good job of that. Both business and government are cited, by a wide margin, for not adequately listening to their primary stakeholders for business, there is a gap of 31 percentage points in this critical behavior; for government it is even greater at 50 percentage points.

Figure 14: Business and government not meeting expectations

How important are each of the following actions to building trust? How are companies/government performing on each of the following attributes?
Business
LISTENS TO CUSTOMERS HIGH QUALITY PRODUCTS OR SERVICES TREATS EMPLOYEES WELL CUSTOMERS AHEAD OF PROFITS RESPONSIBLE ACTIONS ETHICAL PRACTICES TRANSPARENT PRACTICES COMMUNICATES FREQUENTLY AND HONESTLY PROTECTS THE ENVIRONMENT ADDRESSES SOCIETY'S NEEDS POSITIVE IMPACT ON LOCAL COMMUNITIES INNOVATOR REGARDED AND ADMIRED LEADERSHIP DELIVERS FINANCIAL RETURNS RANKS WELL PARTNERS WITH THIRD PARTIES 19%
Business Importance

Government
36% 48% 27% 26% 28% 32% 27% 26% 29% 30% 26% -20 -23 -31 -19 -37 -36 -34 -29 -33 -31 -26 67% LISTENS TO CITIZENS 67% 17% 67%

-50
66%

64% TRANSPARENT PRACTICES 16%

62% 62% EFFECTIVE FINANCIAL STEWARDSHIP

-50
65%

61%

19%

-46
65%

60% COMMUNICATES FREQUENTLY 16%

57%

-49
56%

55% PROTECTS THE ENVIRONMENT 18%

50%

-38
54%

49% PROVIDES EMPLOYMENT TRAINING 18%

46% 41% -5 29% 23% 41% -12 39% -16 38% 31% -7 36% -17
Company Performance

-36
52%

Closing the gap on expectations

POSITIVE IMPACT ON LOCAL COMMUNITIES

16%

-36
41%

PARTNERS WITH THIRD PARTIES

14%
Government Importance

-27
Government Performance

Responses 8-9 only on 1-9 scale, 9 highest; General Population in 25 countries

New Dynamics in Play to Build Trust in Business

To increase trust levels, a combination of operational and societal factors is required; if done right, business has an opening to move from license to operate to license to lead
The 2012 Trust Barometers deep dive into the 16 attributes of trust finds that the factors responsible for shaping current business trust levels (47 percent) are largely tied to business competence and that those that will build future trust are more societally focused (figure 15). Listening to customer needs, treating employees well, placing customers ahead of profits, and having ethical business practices are all considered more important than delivering consistent financial returns and indicate that the path forward entails continuing to do the basics well while also adopting shared values. As part of the Capitalism in Crisis series in the Financial Times, Vikram Pandit, CEO of Citigroup (disclosure: Edelman client) wrote that the loss of trust arose not from a failure of capitalism but from specific failures by certain participants in the financial system. We could go a long way to regaining that trust by making the system more transparent, by clearing some of the obscurity that causes people to believe the system is a game rigged against their own interests. * Mr. Pandit was writing about the financial industry, but the same analysis applies to business overall.
* Financial Times Wednesday, January 11, 2012, p. 9 http://www.ft.com/intl/cms/s/0/90bb724a-3afc11e1-b7ba-00144feabdc0.html

Figure 15: Earning the license to lead requires operational and societal attributes

CURRENT TRUST
47% TRUST BUSINESS
1 Delivers consistent nancial returns 2 Innovator of new products 3 Highly regarded, top leadership 3 Ranks on a global list 5 Partners with third parties

BUILDING FUTURE TRUST

1 Listens to customer needs and feedback

SOCIETAL ATTRIBUTES MORE IMPORTANT TO BUILDING FUTURE TRUST

1 High quality products or services 3 Treats employees well 4 Places customers ahead of prots 4 Takes actions to address issue or crisis 6 Has ethical business practices 7 Has transparent and open business 8 Communicates frequently and honestly 9 Works to protect/ improve environment 10 Addresses society's needs 11 Positively impacts the local community 12 Innovator of new products 13 Highly regarded, top leadership 14 Delivers consistent nancial returns

CURRENT TRUST DRIVEN BY OPERATIONAL ATTRIBUTES

FROM LICENSE TO OPERATE TO LICENSE TO LEAD

SOCIETAL OPERATIONAL

15 Ranks on a global list 16 Partners with third parties

Regression Analysis; Responses 8-9 only on 1-9 scale; 9 highest; General Population in 25 countries

2 0 1 2 | T r u s t Bar o m et er

10

About the Edelman About Edelman Edelman is the worlds largest indeTrust Barometer pendent public relations firm, with
The 2012 Edelman Trust Barometer is the firms 12th annual trust and credibility survey. The survey was produced by research firm StrategyOne and consisted of 20-minute online interviews conducted from October 10 - November 30, 2011. The 2012 Edelman Trust Barometer online survey sampled 25,000 general population respondents with an oversample of 5,600 informed publics in two age groups (25-34 and 35-64) across 25 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 or call 212.729.2166. #edeltrust2012 wholly owned offices in 60 cities and 4,000 employees worldwide. Edelman was named Advertising Ages top-ranked PR firm of the decade and one of its 2010 A-List Agencies and 2010 Best Places to Work; PRWeeks2011 Large PR Agency of the Year and 2011 Large UK Consultancy of the Year; EuropeanExcellence Awards 2010 Agency of the Year; Holmes Reports Agency of the Decade and2009 Asia Pacific Consultancy of the Year; and among Glassdoors top five 2011 Best Places to Work. Edelman owns specialty firms Blue (advertising), StrategyOne (research), Ruth (integrated marketing), DJE Science (medical education publishing and science communications), MATTER (sports, sponsorship, and entertainment), and Edelman Consulting. Visit http: www. edelman.com for more information

On the cover, from top left: protest in front of Bank of America Jessica Rinaldi Reuters; U.S. President Barack Obama meets with House Speaker John Boehner about U.S. debt ceiling Yuri Gripas Reuters; graffiti rendering of logo for Tepco, the Tokyo Electric Power Company, widely criticized for its handling of the disaster at Fukushima Thierry Ehrmann; Next stop: Greece ad on a Washington, D.C. bus shelter, admonishing U.S. to not spend beyond its means Public Notice Media; protester holds up We Are the 99% sign Jon Silver Edelman; Former Olympus Corp CEO Michael Woodford, who unveiled a major accounting scandal at the company, speaks with reporters Toru Hanai Reuters; French President Nicolas Sarkozy and German Chancellor Angela Merkel address a news conference following talks at the Chancellery in Berlin Fabrizio Bensch Reuters.