Trust me, Im your adviser. Lets face it. In todays business climate, thats not always the best thing to say in the opening stages of a business relationship.
Trust or lack thereof can be the most important factor in overall success. That was one of the key findings of last years CFA Institute/Edelman Investor Trust Study, which reads:
Behavior-related attributes including transparent and open business practices, responsible actions to address an issue or crisis and ethical business practices are more important to trust-building than performance-related attributes such as delivering consistent financial returns and offering high quality products or services.
For those of you not in the investment business, dont think this doesnt apply to you. Everyone in this realm is part of the financial services industry regardless of your niche, and collectively, were all in this together.
So, how we doin? Not so good, according to the aforementioned Edelman, or Edelman Public Relations, the worlds largest public relations firm. Every year this firm publishes its Edelman Trust Barometer, which includes information on the financial services industry.
Would you be surprised to learn that the financial services industry continues to be the least trusted trade globally? Thats a rhetorical question. The result is that informed publics worldwide favor increased regulation of the financial services industry. Here in the U.S., almost half (49%) favor more regulation.
And while Washington seems to be listening, as evidenced by the ocean of regulations coming at us, Edelman research finds that there is a significant change in who the trustworthy entities are. People trust business to be more effective than government to innovate, unite and deliver across borders.
So, how do we build trust? Thats not a rhetorical question, and the Edelman research provides some guidance. The Trust Barometer reveals five specific performance clusters ranked in the order of importance:
- Products and services
Why dont you take the time and read the entire 2014 EdelmanTrust Barometer. Maybe youll take up the challenge of being more trustworthy.
Jerry Kalish is a regular contributor to Employee Benefit Adviser and on the editorial advisory board. He is President of National Benefit Services, Inc., a Chicago-based third party administrator. Jerry is a guest lecturer at John Marshall School of Law LLM Program in Employee Benefits and serves on the Great Lakes IRS Advisory Council for Tax Exempt and Government Entity Plans. Jerry has been publishing The Retirement Plan Blog since 2006. He can be reached via email at firstname.lastname@example.org and followed on Twitter and LinkedIn.
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