High in the Swiss Alps here in Davos, we’re straddling a trust gap. Fears of it widening are discussed by leaders from across the global economy in each World Economic Forum meeting I attend.
I discussed this with HuffPo Executive Editor Jo Confino this morning on a live feed, PwC’s newly-released CEO survey reflects jitters across society about uncertainty ― as that is the number one concern among business leaders. They are also keenly aware of the lack of trust in government and in business.
However, business leaders say they’re very confident in their ability to grow (39 percent) and that they’re looking to hire to do so. I’m optimistic about the future of global business and the U.S. economy. Further, I know it’s possible to bridge the trust gap and build stronger economies and societies as a result.
To begin, we must stop globalism from becoming a euphemism. There’s no question that global trade has had a profoundly positive impact, raising more than a billion people out of poverty, making technology more accessible and lives easier as well. But too many people no longer acknowledge these benefits as their own negative experience dominates. They have been left behind as jobs were offshored or technology made their work obsolete or less valuable. Their dreams of a better life stalled, if not dashed. They see support for globalism ―yes, in forums like here in Davos― as establishment leaders making excuses for their own wealth and success.
Companies must act locally to address those who are adversely affected by these global economic forces. These people need to trust again that business actually cares about them, beyond the dollars they carry in their pockets. Businesses must demonstrate a sense of shared values ― a purpose. One might ask: “Isn’t a company’s purpose to maximize profit?”
Employees want to work in a place they believe is inherently doing the right thing. Customers desire products and services built and provided by inherently good companies. If a company’s purpose then is authentic, top employees will be attracted to it and its business growth in the marketplace will reflect that. There’s no need for a choice between doing what’s right for society and what’s right for business. And 75 percent of CEOs agree it is important to have a strong corporate purpose reflected in values, culture and behaviors.
This starts with transparency. If you are to institute a purpose statement in your organization, it better be real. If your purpose is only lip service to this ideal, you will be called out by employees or the public or the media. You will further damage the trust placed in you ―whatever’s left. I encourage companies to lead by accepting the challenge of a purpose. This allows you to control your destiny by making your company better, improving your product and workplace. By being a compassionate employer, an environmental steward, and more socially conscious, you further the trust of your company too.
It may be that acting with purpose starts at the top of an organization but it’s the culture from bottom up that makes it work. Leading business is harder today than ever. The responsibilities to investors, to employees, to customers, to society in general are immense. But that’s the job and executives are paid well for it. Meanwhile, the middle class in America has not had a pay raise in years, according to economic data. That’s a systemic imbalance that needs to be counteracted, as they show up and do their jobs just the same.
I’m a proponent of trust-based leadership which encourages executives and managers to entrust decisions to delegates and flatten the chain of command. By hiring the smartest people and giving them the authority to act for the right reasons at the right times, you infuse your organization with trust.
Finally, diversity must be embraced wholeheartedly. Progress has been made but there is a long way to go. It’s integral for any business to understand the value of varying perspectives whether they’re of ethnicity, gender, sexuality, religion or other background. Morally it’s right to be inclusive, of course. It’s also a best practice for business success from a straight demographics standpoint regarding customer marketplaces and talent recruitment.
There’s no magic wand to burnish trust in our institutions. There is hard work ahead to help those knocked down in the global economic wave. We must build new and better products and services, create new jobs and opportunities, and engage in our communities. It’s our responsibility and our purpose, here in Davos and back home, to re-establish and emphasize trust in the workplace, in the marketplace, and in society. Not only is it the right thing to do, it’s the only thing to do. It’s our purpose.