Edelman Trust Barometer 2010

1. 2010 | A N N U A L G L O B A L O P I N I O N L E A D E R S S T U D Y
trust
2010 | A N N U A L G L O B A L O P I N I O N L E A D E R S S T U D Y

2. Trust in Business Rises Globally,
Driven by Western Economies
On the heels of the Great Recession, when trust in business
sunk to historic lows, the 2010 Edelman Trust Barometer
reports a modest global rise in trust in business. 2010 | A N N U A L G L O B A L O P I N I O N L E A D E R S S T U D Y
The rebound is fueled by a spike in a handful of Western countries, especially
the United States where trust in business jumped 18 points to 54 percent.
It remains high in three of the four BRIC countries, with Brazil, India, and China
above 60 percent. In Russia, the outlier among this group, trust in business
dropped 10 points (figure 1). The overall rise is tenuous, however, with nearly
70 percent saying business and financial companies will revert to old habits
when the financial crisis is over (figure 5, page 4).
A number of actions may have contributed to the boost in trust in the U.S.,
including a rise in the stock market, and a growing trend among U.S. corporations
to listen to and engage their stakeholders, treat their employees well, and play
a role in solving major societal challenges.
Underscoring the renewed U.S. confidence in business, 71 percent of Americans
now say they trust global companies headquartered in the United States, an
increase of 11 points from last year’s survey. The world at large also reflects the
increased trust in U.S.-based business (figure 2).
Figure 1: Global business trust rise driven by gains in a few countries; Figure 2: U.S. surges as trusted
remains high in three of four BRIC countries site for global headquarters
How much do you trust business to do what is right? How much do you trust global
companies headquartered in the
U.S. to do what is right?
2010 | A N N U A L G L O B A L O P I N I O N L E A D E R S S T U D Y
Top 10 Countries by GDP
100 100 100
90 90 +11 90
80
+26
80 +10
+29 80
70 +18 71% 70
71% 72% 71% 70
67% 67% -10 +19
60
59%
62% 62% 62% 63% 60
61% 60% 60
57% 57%
50 54%
49%
52% 50
51% 50
40
40%
46%
42% 40 45%
40
36%
30 34%
30%
36%
33% 30 30
28%
20 20 26%
20
10 10 10
0 0 0
U.S. Germany France U.K. Italy China India Brazil Japan Russia Global China U.S. Russia Germany
Responses 6-9 only on 1-9 scale; 9=highest 2009 2010 2009 2010
Informed publics ages 25 to 64 in 20 countries
2 2010 EDELMAN TRUST BAROMETER

3. Trust in Government and in NGOs Trend Up
Media continues its three-year decline, now ranking lowest among four institutions studied.
Globally, trust in government wit- Figure 3: Trust in government is largely stable; U.S. and Russia move
nessed a modest increase. As with
in opposite directions
trust in business, a handful of countries
sparked the global rise (figure 3). In How much do you trust government to do what is right?
the United States, trust in government
climbed 16 points in one year. France
100
also noted a sharp uptick, with a 9
percent rise. For the most part, in 90
large economies trust in government 80
remains stable, particularly in China 70
72% 74%
where trust in government has always +16 -10
60
+9 +7
skewed high (see figure 13, page 8
50
for a long-term look). Russia is the 48%
40 46%
outlier, falling 10 points to 38 percent. 43% 43% 42% 43% 40% 38% 38%
30 34% 36%
30%
Throughout most of the Western 20
world, NGOs remain the most trusted
10
institution. Across all regions, trust
0
in this institution has increased over U.S. France Germany China India U.K. Russia
time. In no country is this more evident
than in China, where trust in NGOs has
Responses 6-9 only on 1-9 scale; 9=highest 2009 2010
surged by 25 points since 2004 (figure
Informed publics ages 25 to 64
4). This surge may be attributed to a
growing affluence and the resulting 46%
demand for environmental responsi-
bility, education, and public health. Figure 4: Across regions, influence of NGOs rises over time
30%
The only institution to lose trust around 100 much do you trust NGOs to do what is right?
How
the globe is media. Over the last three 90
years, trust in media has fallen from 48 80
70
to 45 percent among older informed 70
65
publics. With the dispersion of tradi-
tional media’s authority and the rise
60
60
of opinion journalism, trust in the 50
55
58%
56%
institution as a whole has waned. 40
50 55%
30
52% 53%
54% 20 48%
45
10
40
35 0
36%
30 36%
25 31%
20
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Informed publics ages 35 to 64 U.S. U.K./France/Germany India China
in U.S., U.K./France/Germany,
India and China
3

4. Trust Is Fragile
Although trust in business Figure 5: Most expect business and financial companies to return
is up, the rise is tenuous. to old habits
Globally, nearly 70 percent After the recession is over, do you expect business and financial companies
of informed publics expect to return to “business as usual”?
business and financial com- Top 10 Countries by GDP
panies will revert to “business 100
as usual” after the recession 90
(figure 5). In addition, most 80
82%
78% 76%
expect government to influ- 70 74%
60
67%
64% 62%
ence banks and financial 60% 59%
50
institutions in the future. 40
49%
30
The fragility of trust is further under- 20
scored by a large percentage of 10
respondents who pointed to short-term 0
actions that companies seemed to India Germany China France U.K. Italy Russia Brazil U.S. Japan
have taken as a result of the financial
crisis. In the U.S., Western Europe, Informed publics ages 25 to 64
and BRIC countries, more than 70
percent say that actions such as firing
non-performing managers, repaying
bailout money, or reducing the pay Figure 6: Since 2007, trust in banks down while trust in technology
gap between senior executives and holds strong
rank and file workers would restore
their trust in the company. In the U.S., How much do you trust the following industries to do what is right?
the numbers skew even higher—with 2009 2010
almost 90 percent of respondents Technology Banks
100
citing firing non-performing managers 100
90 87% 88% 85%
and repaying bailout money as 83% 83% -39
90 87% 88% 78% 85% 77% 83%
pathways to trust. 80 76% 83% 75% 77%
74%
77% 75% -39
80 76% 78% 70% 77% 77% 77%
70 75% 67%74% 75% 68%
70% 62% 68%
This state of fragility is particularly per- 70
60
67%
-16 -20
62%
tinent to the banking industry, a sector 60 -16 -20 -17
50
that has seen its credibility crumble in 50
43% 41% -17
40 43%
the Western world. Since 2007, trust 41% 34%
40 29% 27% 34%
in banks has dramatically declined in 30
29%
30 27% 21%
most Western countries. In the U.S., 20 21%
17%
this decline is steepest, with banks 20 17%
10
losing 39 points in three years. The 10
0
freefall sits in stark contrast to what 0 China India U.S. France U.K. Germany China India U.S. France U.K. Germany
has happened in technology. In the China India U.S. France U.K. Germany China India U.S. France U.K. Germany
U.S. and other major economies,
2007 2010 2007 2010
trust in this sector has risen from
2007 2010 2007 2010
levels that were already high (figure 6).
Responses 6-9 only on 1-9 scale; 9=highest
Informed publics ages 35 to 64
4 2010 EDELMAN TRUST BAROMETER

5. Who Do We Trust?
In a year fraught with economic confusion and uncertainty, informed publics place the most
trust in expert spokespeople and information sources, while trust in traditional media outlets
continues to erode.
Industry analyst or stock reports and friends and peers” as a source of the most trusted spokespeople for
articles in business magazines held company information saw sizable a company.
strong as the most trusted sources of drops in trust in the U.S., U.K./France/
information about a company (figure Germany, and the BRIC countries. Trust in corporate communications
7). However, trust in traditional media such as press releases, reports, and
continues to wane. Among older In a volatile year, it seems that e-mails as sources of information
informed publics, over the past two informed publics value guidance about a company jumps five points
years the credibility of television from credentialed experts over a globally, to 32 percent, while the
news dropped 20-plus points in the “person like me,” which lost ground credibility of corporate or product
U.S.; radio news coverage dropped as a credible voice of information advertising remains low, at 17 percent
by 20 points in the U.K.; and televi- for a company (figure 8). This desire (figure 7). Trust in a CEO as a company
sion news and newspapers declined for substantial information points to spokesperson showed notable re-
by more than 15 points each in the why academics and experts, and covery in many markets (see “The
BRIC countries. “Conversations with financial or industry analysts are Role of the CEO,” on page 7).
Figure 7: Specialist sources most credible Figure 8: Expert voices most trusted
How credible do you believe each of the following is as If you heard information about a company from one of
a source of information about a company? these people, how credible would the information be?
Stock or industry analyst reports 64%
49% Academic or expert
62%64%
Academic or expert
Articles in business magazines 44% 67% 62%
52%
Financial or industry analyst 52%
Conversations with employees 41% Financial or industry analyst 49%
49%
News coverage on the radio 38% 45%45%
NGO representativerepresentative
NGO
41% 41%
Conversations with friends, peers 37%
44%
Person like yourself 44% -3
TV news coverage 36% Person like yourself 47% -3
47%
40%
Online search engines 35% CEO +9
40%
31%
CEO +9
Newspaper articles 34% 31% 35%
Government official +6
29%
Corporate communications 32% 35%
Government official
Regular employee 32% +6
29%
Social networking sites 19% 32%
Regular employee 32%
Corporate or product advertising 17% 38%
32%
0 10 20 3
Informed publics ages 25 to 64 in 20 countries Informed publics ages 25 to 64 in 20 countries 2010 2009
“Extremely credible” and “very credible” responses only; selected sources “Extremely credible” and “very credible” responses only
2010 2009
5

6. The New Corporate Reputation
A vastly different set of factors—led by trust and transparency—now influences corporate
reputation and demands that companies take a multi-dimensional approach to their
engagement with stakeholders.
For the first time, this year’s Trust contrast to 2006, before the financial Partnerships rooted in advancing
Barometer shows that trust and crisis hit, when financial performance societal good also are now a conduit
transparency are as important to was in third place in a list of 10 to earning trust. The overwhelming
corporate reputation as the quality attributes shaping trust in the United majority of informed publics say
of products and services. In the U.S. States (figure 9). In the key European they would be more likely to trust a
and in much of Western Europe, markets and China, the relative company that partners with NGOs
these two attributes rank higher importance of financial performance to solve global challenges such as
than product quality—and far out- as a factor in trust in a company or climate change, poverty, or disease,
rank financial returns, which sits at in corporate reputation remained the this year’s data shows.
or near the bottom of 10 criteria in same from 2006 to 2010.
all regions. This milestone is in stark
Figure 9: In 2010, financial performance least important to corporate reputation
What shapes your trust in a company? How important are these factors to corporate reputation?
U.S. 2006 U.S. 2010
Quality products and services 53% Transparent and honest practices 83%
Attentiveness to customer needs 47% Company I can trust 83%
Strong financial performance 42% High quality products or services 79%
Fair pricing 38% Communicates frequently 75%
A well-known brand 37% Treats employees well 72%
Good employee relations 35% Good corporate citizen 64%
Socially responsible 33% Prices fairly 58%
Visible CEO 23% Innovator 48%
Dialogue with stakeholders 23% Top leadership 47%
Employee/CEO blogs 12% Financial returns 45%
The questions were asked differently in 2006 and 2010.
2006: When you think of companies that you trust, how much, if at all has each of the following attributes contributed to your trust? Please use a nine-point scale
where one means it “has not contributed at all” and 9 means it “has contributed a great deal.” (Top 2 Box) Informed publics ages 35 to 64.
2010: How important are each of the following factors to the overall reputation of the company? Please use a nine-point scale where one means that factor is
“not at all important” and nine means it is “extremely important” to overall reputation. (Top 2 Box) Informed publics ages 35 to 64.
6 2010 EDELMAN TRUST BAROMETER

7. Building a Mosaic of Trust
As the nature of trust has changed, so too has the way that companies must earn it.
Globally, when asked which stake- Figure 10: A stakeholder, not a shareholder, world
holder should be most important
to a CEO’s business decisions, 52 Investors/Shareholders
14%
percent said that “all stakeholders are
When a CEO makes
equally important”—as much as a 4:1
business decisions
margin against individual stakeholders for his or her company,
All stakeholders Customers
(figure 10), underscoring that this is are equally 13% which stakeholder
no longer a shareholder but a stake- important should be most importantto 5 times
52% 3
holder world. to his or her decision? 60%
Society at large
Last year, we learned that people need 11%
Employees Informed publics ages 25 to 64
to hear something about a company Government 7% in 22 countries
three to five times to believe its verac- 3%
ity, pointing to the importance of a
100
multi-channel and multi-spokesperson 100
90
approach (figure 11).
Figure 11: Multiple information sources enhance credibility
90
80
Taken together, these two findings 80
70
Don’t know/ +9
suggest that to advance reputation, 70 +14 refused +9
60 +14 10 or Once
companies need to be everywhere, 60 more times 7% 6% How many times in
engaging everyone. They must build 50 5% +13
Twice general do you need to
49% +13 51%
50
6 to 9 times 49% +13 16% +9 something about
hear 44% 51%
a mosaic of trust by cultivating a 40
+13
40 6% +9 specific company to
a 44%
wide circle of expert spokespeople, 30 35% 33%
30 35% believe that the information
communicating through a variety of 20 26% 33% 26%
is likely to be true?
channels, and partnering with NGOs 20 26% 20% 17% 26%
10 13% 20%to 5 times
3 3 to 5 times
to advance the common good. 10 17%
0 13% 60% Informed publics ages 25 to 64 60%
0 Russia
4 or 5 times France U.K. U.S.
in 20 countries China
25% Russia France U.K. U.S. China
2009 Edelman Trust Barometer
3 times
35% 2009 2010
2009 2010
The Role of the CEO:
Credibility on the Rise If you heard information about a company from a CEO, how credible would the information be?
70
Trust in a CEO as a spokesperson 70 +14 +7
60 +14 +7
for a company showed notable 60
50 +13
49% +13 51%
recovery in many markets. The 50
40 +10 +9 44% 51%
49% +10
improvement may be attributed, in 40 +9 44%
30 35% 33%
part, to those CEOs who view trust
30
20
35% 33% 26%
23%
20
23% 20% 17% 26%
as a line of business. Today’s stake- 10
13% 20%
10 17%
holders are looking for leaders who 0 13%
0 Russia France U.K. U.S. China
will deliver performance, communicate Russia France U.K. U.S. China
frequently and honestly, and consider
“Very credible” and “extremely credible” responses only 2009 2010
the role of business in society. Informed publics ages 35 to 64 2009 2010
7

8. 0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
U.S. U.K./France/Germany China
Trust Over the Decade
The Time Is Now Figure 12: Trust in business, 2001-2010
How much do you trust business to do what is right?
In the past decade, both business
and government have violated stake- 75 71%
holder trust—and demonstrated how 70 67% 66% Optimists
plainly its loss can corrode reputation. 65
60 Enron, the dot-com bust 56% 58%
Fraud at Tyco and Parmalat. False 53%
Worldwide
55 and September 11 51% financial crisis 51% Pragmatists
reports about weapons of mass 50
48% 48% 54%
44% 44%
destruction. High-risk trading ven- 45 50%
49% 38%
tures that crippled Wall Street and 40 36%
35 41% 40% 39% Skeptics
Main Street and led to the failure 35% 35%
38%
36% 36%
30 32% 34%
of long-established companies like
25
Lehman Brothers and GM. As a result, 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
we have seen business and gov-
ernment become more transparent, Informed publics ages 35 to 64 in the U.S. U.K./France/Germany China
invite outside opinion, and join U.S., U.K./France/Germany, and China
forces to tackle global issues like
energy, education, and healthcare.
Trust has emerged as a new line of Figure 13: Trust in government, 2001-2010
business—one to be developed and
How much do you trust government to do what is right?
delivered. Companies that embrace
the new reality, where the interests 90
of all stakeholders must be consid- 80
83% 79%
ered equally, will see their credibility 78% 80%
70 77%
High Trust
rise accordingly. Now is the time for 67%
60 63%
companies and CEOs to deliver
50 48%
performance, communicate frequently 39% 38% 38% 39% 43%
36% 48% 44% 37% Low Trust
and honestly, and consider the role of 40
business in society. Now is the time 26% 25% 38%
30 22% 32%
27% 31% 31% 30%
for business to prove its commitment 20
27%
to profit and purpose. 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Richard Edelman Informed publics ages 35 to 64 in the U.S. U.K./France/Germany China
President and CEO, Edelman U.S., U.K./France/Germany, and China
About the Edelman Trust Barometer About Edelman
The 2010 Edelman Trust Barometer is the firm’s 10th annual trust and credibility Edelman is the world’s leading independent public relations firm, with 3,200
survey. The survey was produced by research firm StrategyOne and consisted employees in 51 offices worldwide. Edelman was named Advertising Age’s
of 25-minute telephone interviews using the fielding services of World One from top-ranked PR firm of the decade, PRWeek’s “2009 Agency of the Year” and “Large
September 29-December 6, 2009. The 2010 Edelman Trust Barometer survey Agency of the Year” (for the third time in the last four years), and Holmes Report’s
sampled 4,875 informed publics in two age groups (25-34 and 35-64). All “Agency of the Decade” and “2009 Best Large Agency to Work For.” Edelman owns
informed publics met the following criteria: college-educated; household specialty firms Blue (advertising), StrategyOne (research), and BioScience
income in the top quartile for their age in their country; read or watch business/ Communications (medical education and publishing). Visit http://www.edelman.com
news media at least several times a week; follow public policy issues for more information.
in the news at least several times a week. For more information, visit
http://www.edelman.com/trust or call +212-704-4530. © Edelman, 2010. All rights reserved.
On the cover, from top left: Chinese medical workers inject students with H1N1 flu vaccine in Jinjiang city;
Jamie Dimon, chairman and CEO of JP Morgan Chase & Co.; GM headquarters in downtown Detroit; Bernard
Madoff exits a federal court in Manhattan; Detroit resident holds an employment guide while attending a job fair
in Livonia, Mich.; Chancellor of the Exchequer Alistair Darling launches an analysis of Tory spending plans.
8 2010 EDELMAN TRUST BAROMETER