Davos take note: we don’t trust you

Image of Gillian Tett

If a big crisis hit tomorrow and you needed soothing advice, where would you look? Your Facebook friends, LinkedIn network or the “Twitterati”? Or would you expect business executives and government officials to solve the problem – and hand down information you could trust?

It is not an idle question. These days, the world is beset with challenges, ranging from sudden shocks (think financial crisis or bird flu) to slow-burn issues (ageing and environmental pollution). And this week I – like thousands of others – have been sloshing through the snow in Davos, listening to global leaders pontificate on these woes.

Traditionally, this has produced plenty of grandiose rhetoric, along with pleas for “co-operation”, so that everyone can rebuild “trust”. But as the pious language gets tossed about – amid the champagne and business cards – what few of the elite ever dare ask themselves is whether anybody beyond the rarefied air of Davos will actually believe anything they say?

A survey released by Edelman, a public relations firm, on the sidelines of Davos offers some sobering insights. Once a year, Edelman asks people in 26 countries which institutions and business sectors they do (or do not) trust, and what information they believe. Like any survey, this has flaws: “trust” is a subjective issue, and the Edelman survey does not always match other research, for example from Mori.

But what Edelman had to say this week pointed to some interesting trends. If you look at levels of trust in the world today, on a five-year view – or since the financial crisis of 2008 – there has been a sharp downturn in the level of credibility commanded by most western institutions: confidence in banks, for example, has tumbled sharply, while faith in government and business has eroded too. The media has also suffered (and, no, I am not afraid to point that out).

However, in recent months, a small swing has occurred: the proportion of the informed public who trust government, for example, has jumped to an average of 46 per cent in the 26 countries, up from 38 per cent in 2012; for business and media, it has moved from 47 per cent to 56 per cent and 55 per cent respectively. This is still low by historical standards, but might hint at a swing.

Moreover, the national details in this survey contain some noteworthy twists. In America, for example, the level of confidence in banks has risen sharply in the past two years, while trust in Spain, Ireland and Britain has crumbled (I guess that reflects the fact that America has been quicker in tackling its financial rot). In Britain, faith in the media has tumbled sharply in recent months, making it a global outlier (no prizes for guessing that this is a consequence of the hacking scandal). And while American and British consumers trust small companies more than big business, in China that pattern apparently is reversed.

But to my mind the most interesting detail revolves around the question I posed at the start of this column: does anyone trust the elite? A couple of decades ago, when Edelman asked people where they looked for guidance, they gave a high ranking to traditional “authority” figures such as chief executives and political leaders. That is not the case now. These days, academics and technical experts are still trusted. But CEOs, government officials and regulators are bottom of the list.

However, this has not created a complete vacuum: as faith in leaders has ebbed, people have put more trust in their peer group, defined as a “person like me”. Trust is being expressed in horizontal ways, rather than on a vertical axis.

It might be tempting to blame this on the financial crisis. But that would be wrong: the trend actually started in the middle of the last decade, suggesting something else is afoot.

I would guess this “something” is the spread of the internet and social media. For another interesting point is that the public’s faith in technology is sky-high today – and has not been dragged down in recent years. People might not trust banks or bureaucrats, but they do trust their BlackBerrys, iPhones and Facebook friends.

In some senses this is very good news: a world of “horizontal” trust could potentially be a more democratic place. In other aspects, however, it is also challenging: when the wisdom of cyber-crowds rules, sentiment (and policy) can suddenly swing in volatile ways. But either way, this trend is unlikely to be reversed soon. And responding to it will require far more than token tweeting from that Davos elite – no matter how arresting some of those mountaintops tweets might be.


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