By Paula Cowan, Managing Director, ImpactInstitute
Is there a significant opportunity for businesses to redefine their role in society? And should they?
The latest Edelman Trust Barometer presents a nuanced picture of public sentiment, and while it highlights some key challenges, it also underscores the potential for organisations to build stronger connections by prioritising impact.
This year’s Trust Barometer, marking its 25th anniversary, reveals a notable sense of grievance among the population. Put simply, many Australians feel that the current systems favour the elite.
Tom Robinson, CEO of Edelman Australia, joined us on The CMO Show and explained, “respondents who claimed either a moderate or high grievance in the report this year felt overwhelmingly that the system favoured the rich.”
This feeling of inequity has significant implications for how businesses are perceived, but it also creates an opening for organisations to demonstrate their commitment to a fairer society.
Addressing Societal Issues: An Invitation for Corporate Action
Crucially linked to this grievance is the perception that businesses need to do more to address pressing societal issues.
Tom said communities are looking to the corporate world to take a more active role in tackling challenges that directly affect their lives, such as the cost of living and environmental sustainability.
“What we find is a firm belief across communities that business is still not being seen to do enough to tackle some of today’s most pressing issues.”
This expectation isn’t a burden; it’s an invitation for businesses to align their values with their actions and become genuine agents of positive change.
The Rise of Localised Trust
In recent times, we’ve seen trust very quickly erode in organisations who overnight lost the courage of their convictions. Tesla’s plummeting share price is a pertinent example.
Edelman’s research reveals a broader trend towards localised trust. People are increasingly placing their trust in those closer to them, within their communities and workplaces, rather than traditional establishment authorities.
“Trust is now local. We no longer trust traditional establishment authorities. It happens in and around my community, and I don’t just mean physical community. This could be a kind of online community or those that I interact with, my employer, or my workplace,” Tom said.
This shift underscores the importance for businesses to focus on their immediate impact and engage authentically with their local communities.
What’s going to give your community confidence that you won’t suddenly change course? Align your purpose with your actions, implement measures for positive outcomes, and then be willing to be accountable for those outcomes.
You can only really do that if you’re communicating what your impact should be and being transparent about how you’re going against that.
Accountability Builds Trust
So, businesses that hold themselves accountable to their communities, measure and tell the stories of the impact they’re having, and strengthen connections through the networks they’ve steadily built are the ones that inspire trust.
It starts with identifying key areas where the business can make a significant impact and developing a roadmap to achieve these objectives. By integrating impact-driven goals into their strategic planning, organisations can ensure that their efforts are focused and effective.
But it shouldn’t stop there. To build trust and demonstrate their commitment, businesses need to measure their social impact initiatives, assess their progress, and make data-driven decisions in the interests of people and communities.
This rigorous approach to impact measurement ensures transparency and accountability, which are necessary for building stakeholder trust and addressing societal issues effectively.
Building a Resilient Future
So, where to from here? Tom offered three tips for business leaders and CMOs to “stand up, really understand, and listen to take note and action on what’s happening in Australia right now”. This involves:
- Demonstrating empathy and understanding for communities: Actively listening to their concerns and needs.
- Finding diverse spokespeople: Recognising that trust is increasingly placed in voices beyond the CEO, such as scientists, subject experts, and community leaders.
- Being intentional and focused: Prioritising key areas of impact where the business has a genuine role to play, rather than spreading efforts too thinly.
By taking this approach, businesses can directly address the feeling that they are not doing enough.
Measuring and communicating social impact provides concrete evidence of their commitment and helps to rebuild trust with stakeholders. As the Edelman research suggests, “when trust increases, economic optimism overpowers grievance”.
By proactively focusing on creating positive social impact and transparently demonstrating their efforts, organisations can not only navigate the current climate of scepticism but also build a more resilient and prosperous future for all.
Ready to put impact at the centre of your business? Our integrated team can help you plan, deliver, evaluate and communicate your social impact. Get in touch and let’s have a chat.