Essay on trust: A panoptic view of a multifaceted notion

Magazine: Trust in society – September 2019

Presumption, impression, belief, attitude, conviction, speculation, expectation, wager – when it comes to the seemingly straightforward term “trust”, philologists, economic experts, politicians, cultural observers and media professionals find the most diverse descriptions and synonyms for this concept. None is conclusive. Yet upon second thought, most people are likely to agree: trust is one of the most complex mental states of all. In that spirit, we take you on a tour d’horizon as a prelude to this, the latest issue of ceo magazine.

The noble art of vulnerability

“Trust is the feeling that you believe a person while knowing that you would lie if you were in his place.” Thus sayeth American writer and cultural critic H. L. Mencken. Researchers in this field, however, define trust as “the willingness to reveal oneself as vulnerable”. This involves: 1) the conviction that the other guy is not an egoist or that a company is not just in it for the profit; 2) the intuition that one can rely on promises; and 3) the hope that trust will ultimately pay off at some point. Then comes the scientific definition of trust, which is inherently controversial in that concepts such as feelings, irrationality, vulnerability, faith and hope have little sway and even less say in the economic world of hard numbers – despite the fact that trust-based relationships are vital for survival here as well.

Sources: Prof. Dr Antoinette Weibel, Institute for Work and Employment Research,
University of St. Gallen; Mayer, Davis & Schoorman, 1995; Rousseau, Sitkin, Burt & Camerer, 1998

Those who trust are optimistic

Trust engenders a sense of security. It gives people the feeling that those at the helm or down in the engine room “are doing things right”. The Swiss people trust the public sector like no other folk. And interestingly, a positive correlation between trust in the authorities and people’s optimism is to be observed in Switzerland. It should also be noted in this regard that the Swiss Federal Constitution does not provide for the possibility of a parliamentary vote of no confidence against individual government members or against the government as a whole.

Source: “Security 2019. The Trend of Opinions on Foreign, Security, and Defence Policy”, ETH Zurich, 2018

A trusting nation

Switzerland is culturally heterogeneous, and the will of the individual or group carries considerable weight. Nevertheless, many people accord the same characteristics to the identity of the country. These include a high level of prosperity, reliable political institutions, a good education system, a stable business location, a strong financial centre and a beautiful landscape. Neutrality also plays an important role in this identity and is inextricably linked with the ideological mindset of the nation.

Sources: Government at a Glance 2017, OECD; Credit Suisse Worry Barometer 2018

A word about the word

The first known use of the word “trust” was in the 16th century. It derives from the Old Norse “traust” (cognate with the German “Trost”, i.e. comfort). The Middle High German “triuwe” describes characteristics such as loyalty and sincerity. It has its origin in Old High German terms like “triuwa” and “gitriuwi”, which in turn evolved from the Indo-European root “deru”. Their meaning is associated with words like “tree” and “oak”, connoting inner solidity. Grammatically, “trust” is a “weak” verb.

Sources: PwC own research and the NZZ series “Vertrauen”, October 2018

Safe is safe

In the international community, Switzerland is regarded as trustworthy, especially when it comes to banking and financial services. There are various reasons for this. On one hand, Switzerland stays in sync with global market trends, as evidenced by the elimination of banking secrecy and the adaptation of certain tax regimes. On the other hand, Switzerland affords a high degree of legal certainty, which makes it a reliable partner for companies and hence an attractive location for doing business. And finally, with Switzerland’s system of direct democracy, every citizen has a say in the political decision-making process.

Sources: 2019 Edelman Trust Barometer; exchangemarket.ch, August 2018

Digital ambivalence

The Swiss electorate is divided on the social impact of new technologies. Despite the threat of job losses as a result of technological progress, 75 per cent consider it unlikely that their work function will be automated in the next 20 years. Digital technologies make it possible to gain an overview of the labour market and improve working conditions. They also facilitate creativity in the workplace. However, there is the growing fear that employees will be expected to remain reachable at all times. A majority believes that digitalisation will make society more lax and vulnerable, devalue interpersonal communication and provoke mental illness.

Source: Credit Suisse Worry Barometer 2018

A vicious circle

The term “mistrust” is not the oldest in the dictionary, but it remains somewhat controversial. Does it mean the opposite of trust, or instead a low level of trust, or does it have nothing to do with trust? Behavioural researchers explain mistrust as “the unwillingness to accept vulnerability due to a pervasive negative perception of the other person’s motives, intentions or behaviours”. Mistrust reinforces itself in that mistrustful thinking and action reinforces mistrustful attitudes and behaviours. According to the latest findings, mistrust is an independent state of mind, as it is caused by other factors than those associated with trust. Studies in neuroscience and neurobiology show that different brain regions are activated and different hormones are released, depending on whether a person trusts or mistrusts.

Sources: Prof. Dr Antoinette Weibel, Institute for Work and Employment Research,
University of St. Gallen; Bijlsma-Frankema et al., 2015; Dimoka, 2010; Zak, Kurzban, & Matzner, 2005

Faithful everyday companions

From getting up in the morning to going to bed at night: brands accompany us every day. Some we love, some we hate, some we trust, some we mistrust and some we’re totally indifferent about. Numerous factors determine the success and staying power of a brand: quality, value for money, image – and the list goes on. The brands that Swiss people trust most include Coop Bau+Hobby, Volkswagen, Ticino, Raiffeisen, Ricola, Die Mobiliar, Nivea, Fielmann, Burgerstein or Emmi.

Source: study “Trusted Brands 2019”, Reader’s Digest

Far-sighted investment

How a company goes about handling its human capital is one of the best indicators of its trustworthiness. There is enormous potential for trust between employers and employees. In a sense, this can be capitalised as added value – provided the company takes the concerns of its workforce seriously and fulfils its part of the deal. Trust gives managers the courage to delegate decisions, foster personal responsibility and help shape change within the company. Trust also acts as a cement in teams that frequently need to be remanned or become more heterogenous in order to achieve a competitive advantage. And not of least importance, trust strengthens human resilience and creates the gumption necessary to bear up under a heavy workload in an increasingly demanding environment.

Sources: 2019 Edelman Trust Barometer (chart); “Trust rocks! Aktives Vertrauen als Grundstein für das Gelingen der Neuen Arbeit” (Active Trust as the Foundation Stone for the Success of New Work) by Prof. Dr Antoinette Weibel, Simon Schafheitle and Margit Osterloh

Good grades for the economy

In the eyes of the Swiss electorate, the domestic economy cuts a fine figure compared to others across the globe. And this perception corresponds to the reality of the hard numbers: Switzerland holds second place on the IMF’s list of countries ranked by per capita GDP. Nevertheless, 41 per cent of those voters still feel that the Swiss economy frequently comes up short.

Sources: Credit Suisse Worry Barometer 2018; International Monetary Fund (IMF), April 2018; Federal Statistical Office

Yearning for truth

Many Swiss believe that the Internet has made it easier to disprove lies and misleading statements. However, most people are also convinced that the proportion of untruths in the traditional media has increased since the advent of the Internet. Although there is a high degree of trust in official and government sources, when it comes to everyday decisions, people prefer to rely on their gut feeling rather than on a purported specialist’s say-so. The spreading of falsehoods and so-called fake news is seen as a real threat to direct democracy and social cohesion.

Source: “Wahrheit und Lüge in Zeiten von Fake News – Einstellung der Schweizer Bevölkerung” (Truth and Lies in Times of Fake News – Attitude of the Swiss Populace), sotomo opinion research institute, at the behest of Stapferhaus Lenzburg, October 2018

Old topic, new concerns

Mr and Mrs Schweizer are satisfied, at least by international comparison. A major concern in previous years – unemployment – is losing importance as digitalisation is causing fewer fears of job loss. Still, much remains to be done. The most pressing problems facing the Swiss population are pensions, health and migration. Every sixth interviewee is concerned about material issues: worries regarding wages and new poverty are on the rise. The wealth gap in society is widening and the number of so-called working poor is on the rise.

Source: Credit Suisse Worry Barometer 2018

Hold your nose and jump in

Social psychologists view “blind faith” as a surrendering, submissive act which, as a form of trust, increases one’s own vulnerability vis-à-vis the trusted party – because only those who literally “jump into the deep end” will ultimately find out whether their trust was justified. Trust therefore always also means giving up control, not being able to know, explain or justify everything – and is thus all the more pivotal in its significance. Accordingly, companies would do well to allow for intuition and gut level decisions and to encourage them as part of their corporate culture. But then comes the hard part: namely, embracing irrationality as a key component of successful collaboration.

Sources: Prof. Dr Antoinette Weibel; Institute for Work and Work Employment Research, University of St. Gallen; Möllering, 2006; Zand, 1972

No data, no deeds

There are growing concerns amongst the Swiss about putting personal data on the Internet. This scepticism is most pronounced when it comes to the disclosure of account numbers, the publication of personal videos or photos, the disclosure of illnesses, as well as the posting of status reports on social media. Mr and Ms Schweizer feel increasingly threatened by digital companies such as Google or Facebook. The growing scepticism in regard to online payments is heightening awareness of the necessity for password upkeep. Nonetheless, most Swiss believe that data protection is well regulated in Switzerland.

Source: data trust study 2019 by comparis.ch

A hard currency with soft attributes

Money is fragile. The value of a currency depends on the trust we place in it. Switzerland is heavily dependent on the development of the Swiss franc. It has long been regarded as trustworthy and is the number one safe-haven currency in times of uncertainty. This has to do with, amongst other things, the pronounced confidence in the Swiss rule of law and the high degree of price stability in Switzerland. Money can only function as a stable unit of account and store of value if society assumes that it will continue to fulfil those purposes in the future.

Sources: PwC own research and “Zerfällt das Vertrauen in Geld, zerfällt auch die Gesellschaft” (If Trust in Money Breaks Down, Society Also Breaks Down), NZZ of 12.10.2018

9 rules for the credible CEO

Take charge in the event of changes
State a clear position on key issues
Show yourself inside and outside the company
Offer personal information, such as your values or your success story
Remain accessible and speak the language of your people
Take decisions based on data and facts
Communicate regularly and directly
Put the spotlight on your people, not yourself
Personify the company’s values

Source: 2019 Edelman Trust Barometer

For the sake of the environment

For some 20 per cent of the Swiss population, one of the most crucial issues relates to their concern about the state of the environment. Never since 2006 has this reading on the Worry scale been as high as it was in 2018, partly because of the exceptionally hot summer of 2018. The “Fridays for Future” movement is likely to have spawned awareness of climate protection and the onward march of global warming.

Sources: PwC own research and Credit Suisse Worry Barometer 2018