The topic of trust is not a new one; trust has always been key to building and maintaining relationships. Truces are built on trust, contracts are built on trust, monetary policy is built on trust. Trust is built by consistently and reliably doing what you say you will do. “I promise to pay the bearer” is a real demonstration of trust equity established over a long period of reliability.
So, like all relationships, employee relations are reliant upon trust, and the depth of trust defines the strength of the relationship. Trust as a value is a constant, but what is expected to be trustworthy often varies with individual needs. As the needs of individuals change, the expectations of trust are evolving.
A new era for employee relations
Employee relations and the terms of the psychological contract have progressed over time and many employees are now seeking a new experience from their work. The basic loyalty contract of the 20th century - exchanging security, pay and benefits for loyalty, commitment and retention - was superseded by the engagement contract, which recognised the psychological needs of workers for recognition and equity, and to be valued and rewarded in exchange for their effort.
The latest evolution, according to Mercer, is the lifestyle contract, recognising physical, emotional and financial well-being needs and offering a healthy working experience in exchange for sustainable performance. Throughout, the issue of trust remains a constant. Trust that the terms of the psychological contract between employer and employed are honoured, that organisations behave as they claim, or staff will vote with their feet.
A shift in power
Trust used to be centred around job security, but as working arrangements become more short-term and flexible, Millennials and Gen Zers neither expect, nor offer, long-term loyalty. As the balance of employment power shifts from employers historically able to recruit and reduce staff at will, to a demand led market where power lies in individuals with sought-after skills, experience and capabilities employers need to ensure that their EVP delivers what employees really value and trust is key to this equation.
With the lifestyle contract, employees now want work for organisations that respect their values. Employers that individuals trust to align with their beliefs and demonstrate that with their behaviours will become the employers of choice.
Trust at a premium
The proliferation of mis/disinformation and awareness of fake news is elevating the issue of trust in the collective consciousness.
“The polarization of media, geopolitical uncertainty, the pace of digital transformation, the increasing expectations of stakeholders, the scrutiny of data, climate change, and a recessionary environment make trust a top-of-mind issue” explains Michael Bondar, Deloitte’s global Enterprise Trust leader.
Trust is such an issue, that according to Deloitte, 19% of organisations now have a C-suite leader dedicated to trust-building. Elena Kvochko, the first Chief Trust Officer to be appointed at software company SAP, states that “Trust is a clear competitive differentiator,” and Deloitte research suggests companies deemed “trustworthy” outperform their competitors by up to four times. 88% of buyers who trust a brand highly become repeat customers, and 79% of employees who trust their employers highly feel motivated at work.
So, whilst the main attention on trust may be consumer-led, similar logic clearly applies to employee trust.
Trust in the employment arena is increasingly focused on authenticity, sustainability and social responsibility. It is not enough to simply have an ESG strategy, employees want to be able to trust that it is actually followed, and ideally that it is integral to the ethos and operations of their organisation.
Words are not enough. This commitment - and the trust it builds - is judged by actions.
Held to account
Examples of the strength of feeling around perceptions of trust, and betrayal of trust in organisations can be seen in growing accusations of greenwashing. Coca-Cola tries to be seen as sustainable, but after being identified as the world’s leading plastic polluter for five consecutive years by Break Free From Plastic, their iconic bottle shape is now synonymous with plastic pollution.
Employees and consumers alike want to be able to trust organisations on a subject as important as sustainability, so any organisation being perceived to be less than honest to further its business interests can expect a backlash. Employees in the same way as consumers now have the luxury of choice and can use their labour might to support those organisations that engender that trust.
So, it becomes clear that organisations which not only espouse social, environmental and ethical values, but are actually trusted on them, will win through. You can trust us on that.