3 steps for rebuilding trust in business

The problem is one of trust – or lack thereof. The 2014 Edelman Trust Barometer reveals that less than one-fifth of the global public believes that business and government officials will tell the truth when confronted with a difficult issue.

That public sentiment is affecting business worldwide. The Duke University CFO Magazine Global Business Outlook Survey found that nearly 60% of chief financial officers in the United States believe that a lack of public trust has harmed the business environment. Those percentages are even higher in other parts of the world.

Given the constant stream of security and data breaches and allegations of financial manipulation involving some of the world’s most respected banks, who can blame the public for feeling this way? Now, more than ever, we need leaders who can regain the public’s trust. To do that, we must redefine what it means to be a competent business leader.

Traditionally, society has measured business competence by a person’s intellectual ability to examine problems broadly and deeply. But, in order to seize global opportunities today, we need to emphasize a new dimension: the ability to create a shared set of values and foster a culture that embraces those beliefs. Doing so requires taking three, sometimes uncomfortable, steps.

First, business leaders must overcome their fear of learning from others. That sounds simple, but how many executives can admit that they don’t know everything or that they aren’t the smartest person in the room? Many business leaders talk a good game about diversity, but surround themselves with people who are just like them. Working closely with others who think differently can be scary and frustrating. But the best leaders have the courage to encourage authenticity in both themselves and others.

Second, embrace the ambition of others. The downfall of many business leaders in recent years has been greed and selfish ambition. Great leaders are other-directed instead of self-focused. They adopt a “your success is my success” mentality. This attitude goes a long way toward developing trust among team members and helps foster strong commitment to a common vision. It also requires leaders to trust others that they will not abuse the faith placed in them.

Finally, business leaders must value collaboration – and mean it. Leaders who overcome fear and frustration, embrace the ambition of others, and possess a strong character and sense of purpose are likely to build diverse teams whose members share an identity and common goals but still represent themselves authentically. Research has shown that such teams outperform others, which means that this approach can lead to a tremendous competitive advantage. In short, collaboration not only matters; it wins.

Imagine the immense potential we would have to solve some of the world’s toughest challenges if business leaders adopted this strategy. Consider the global threat posed by Ebola. Efforts are underway to research, manufacture, and distribute experimental drugs that could treat the disease. But until now drug companies had largely ignored Ebola, because there appeared to be little profit in developing a drug for populations that could not afford to pay for it.

The New York Times reported last month that United States officials are planning to scale up the production of one experimental drug, but it is still not likely to meet demand. If some of the brightest minds in business and health care had found a way to encourage the production of an Ebola drug before the outbreak, thousands of lives might have been saved.

The type of leadership that I am advocating poses no threat to a company’s bottom line. On the contrary, it is the starting point for scaling a business to its full potential. As former Proctor & Gamble CEO and current US Secretary of Veterans Affairs Bob McDonald is fond of saying, leaders have a responsibility to make sure that their organization can “do well and do good.”

Business can be the common thread that weaves positive change throughout the world. In order to reach that goal, we need business leaders with the vision, skills, and commitment to make a profit and a difference. A new standard for business competence that incorporates more than the bottom line will go a long way toward winning back the public’s trust.

Published in collaboration with Project Syndicate

Author: William Boulding is Dean of Duke University’s Fuqua School of Business and a member of the World Economic Forum’s Global Agenda Council on Values 2014-2016.

Image: A man walks past buildings at the central business district of Singapore February 14, 2007. REUTERS.