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Richard Edelman - 6 A.M.: TRUST 2008

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January 22, 2008 TRUST 2008 I am on my way up to Davos for my favorite four days of the year at the World Economic Forum. We will be unveiling the ninth edition of the Edelman Trust Barometer tomorrow morning. We expanded this year’s study to include -- for the first time -- 25-to-34 year old opinion leaders in 12 countries, sampled concurrently with the 35-to-64-year-old group in 18 countries. Here are the key findings from this year's study: First – Business has opportunity to take on dual mandate of making money while addressing major societal issues: Trust in business is much higher than trust in government in 14 of the 18 countries where we conducted the survey. The gap is highest since we began the survey and especially wide in the US and the developing world except in China. Second – Consider heritage: Trust in companies is linked to national origin, industry sector and specific events. We find a trust advantage for Canadian, Swedish and German companies and discount for Chinese, Russian, Mexican and Indian companies. Big American brands, such as McDonalds, continue to operate with a trust discount in Europe. The technology and biotech sectors are most trusted, the insurance and banking least trusted, with pharmaceuticals and energy trending up. Events of past weeks have taken a substantial toll on financial service brands such as Citigroup and Merrill Lynch. As of a week ago, less than a quarter (24%) of adult Americans trusted Citigroup to do what is right and the equivalent trust for Merrill Lynch was 35%. Third – Communicate peer-to-peer, as well as top-down: There is highest trust in ‘people like me’ and experts such as ‘academics’, ‘doctors’ and ‘financial analysts.’ Trust in CEOs remains mired at around 20%, same as for past five years. In contrast, trust in an ‘average employee’ is twice as high as trust in a CEO, indicating that CEOs need others to reinforce their communications to stakeholders. Fourth – Align corporate reputation with consumer brands: The four drivers of business trust globally, in this order, are: Customer (quality of products, service, value), reputation (social & environmental record, place to work), leadership (financial, CEO, industry), and local familiarity (local presence, someone you http://www.edelman.com/speak_up/blog/archives/2008/01/trust_2008.html (1 of 4)1/25/2008 12:38:02 PM

Richard Edelman - 6 A.M.: TRUST 2008

trust works at the firm). Fifth – Media is more important today than ever: Mainstream media continues to be the most credible source of information about companies, particularly business magazines, followed by analyst reports with newspapers and TV. Trust in media as an institution is at a high point in the study’s history, with marked increases over past year standings in the U.K., Germany, the United States, Canada, Japan, South Korea, and India. The definition of media is expanded to include social media. Sixth – Corporate communications must incorporate social media: As you might expect, social media matters most to the 25 to 34 age group. For instance, Wikipedia is listed as the #2 most credible source of information about companies in the US, after business magazines. Google—which aggregates news is cited as one of only three global media sources listed in every market we survey. The other two are CNN and BBC. Also, use of social media for company information is generally highest in BRIC countries. Seventh — Engage the info-ential generation to build a beachhead: The 25-to-34 year old group is more trusting of business, less xenophobic and more reliant on multiple sources of information than their older counterparts. In conclusion, as we seem to be heading toward recession, the goal for business should be to maintain their license to operate. This depends on banking trust capital by running a good business, taking on large societal issues in the context of profit making opportunities and presenting the business case in a transparent and convincing manner. I will be blogging during the week. Hope to hear from you. Richard

Click here for a copy of the press release. Click here for the Financial Times' review of the findings. The 2008 Trust Barometer Report will be published on Thursday, January 24. Posted by Edelman at January 22, 2008 2:22 PM

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Richard Edelman - 6 A.M.: TRUST 2008

Comments Regarding people's lack of trust in governments (finding #1) and the higher degree of trust that people place in "people like me" and the "average employee" (finding #3), it is apparent to me that the US Government efforts in Strategic Communications and Public Diplomacy would greatly benefit from enabling government officials to engage key audiences via new and traditional media in their area of expertise and within the purview of their position. In short, government officials should be enabled to "blog at their paygrade." Posted by: Charlie at January 23, 2008 1:11 AM

Have a good time! IÂ´ll be 'listening' to you. Benito Castro, from Sevilla, Spain. Posted by: Benito Castro at January 23, 2008 2:18 AM

Greetings from Copenhagen, Richard. I am a former Edelman employee (New York) and am now living in Denmark. I saw your interview with Richard Quest on CNN yesterday. You are looking well. Congratulations on getting the word out about the survey. Best regards, Laura Stadler-Jensen Posted by: Laura Stadler-Jensen at January 24, 2008 3:54 AM