Monday, January 27, 2014

The trust conundrum.

South African government one of the least trusted in the world.

Only 17% of informed South Africans taking part in the latest Edelman Global Trust survey, trust the government to do the right thing.

This is the first time that South Africa has been included in the annual global barometer monitored by the world’s largest public relations firm. While opinion surveys have their pitfalls, the long standing Edelman research is viewed as one of the most authoritative and covers 33 thousand respondents in 27 countries. South Africa has made a rather shameful debut in its 2014 survey released this week, showing the lowest informed trust in government of the 27 countries researched.

One is tempted to conclude that this lack of trust by the informed (college educated, high income mature adults) is not shared by the less informed. But this is contradicted by the relatively low general public trust index average of 42%, which covers trust in the four main institutions of government, business, media, and NGO’s, or civic organisations.

This again raises the question why a government with such a low level of trust, still has such overwhelming support at the polls. Blind historic allegiance to the “struggle” and less populist opposition parties are perhaps two of many answers. But in the absence of comparable Edelman data (which shows a global trend of a substantial decline in government trust) the forthcoming April elections could yield some surprising outcomes.

Despite political and media rhetoric (my own included) that has criticised business behaviour over the past number of years, most informed South Africans (63%) still trust business to do what is right. This means that the country has another dubious honour of having the widest gap of the countries surveyed between trust in government and trust in business.

The gap globally is one of the noteworthy features of the survey and is shared by virtually all of the countries involved.


This poses a colossal conundrum for business and society as a whole.

· There are still many (42%) who distrust business.

· Trust in business generally has not improved. Indeed it has been buoyed by an improvement in emerging markets, but an entrenched if not growing scepticism in the developed world.

· While most trust business more than government, there is a continuing demand for more regulation of business, especially in the financial sectors, energy and food.

· More than half (51%) see the primary role of government as being the regulation of business and protecting consumers against exploitation.

· Company leaders are simply not trusted. Only about 20% of the general public trust business leaders to make ethical or moral decisions; tell the truth and help solve societal problems. It is even less (about 15%) for government leaders, pointing to a lack of moral leadership worldwide.

· Adding to this sense of disquiet is the decline in public trust in the media – down from 57% to 52%. American and British media score rather poorly at about 40%, while South Africa media received a rating of 55%.

· As sectors, the media and banks share the lowest rankings in trust, the latter having improved their trust score in the last year or so. The most trusted sector is technology followed by the automotive industry.

· Less than half of the general public trust the financial services industry to do the right thing, with the financial advisory and asset management sector ranking even lower at 46%.

· The most trusted constituent in society remains the NGO or civic organisation sector, followed by business, the media and then government.

Edelman CEO, Richard Edelman believes it will be “a monumental error” for business to see the sharp decline in trust in government as an opportunity to agitate for greater deregulation. They should rather build on their higher trust position to engage societal concerns.

“Our research indicates a reputation hangover for business from the Great Recession of 2008. Events of the past 12 months ...have renewed concerns about business’ ability to self-regulate”, he says.

The latest Trust Barometer again reminds business of the need to move away from old paradigms and assumptions about itself. It’s a subject that has occupied most of my writings in “The Human Touch” on Moneyweb. The narrow “profit above all else” mantra and short-term shareholder value criteria that have dehumanised business over the last few decades will impede the evolvement of business and a return to its rightful place as a force for good and making a meaningful difference to our lives.

Edelman Executive Ben Boyd has perhaps summed it up best: “Today’s world requires a shift from the historic, transactional nature of capitalism to a model of value creation that encompasses societal benefit as well as shareholder value. This year’s data outlines not only an opportunity, but more importantly, a responsibility for business to redeļ¬ne and reprioritize the way it thinks about value. To this end, value is no longer the sole domain of the finance function.”

Sound familiar?

Monday, January 20, 2014

An old man’s melancholy.

From much more than the passing of a global icon.

As quickly as it had erupted, it subsided – soon to be absorbed into the routine joviality that marks every holiday season and to become little more than snapshots in memory banks

In my half century as an active journalist and newsman, during which I personally was involved in the coverage of some major news events such as the 1968 Port Elizabeth floods; one of Chris Barnard’s early heart transplants, the 1969 Boland Earthquake and countless major economic events, I never experienced, or even witnessed such a puzzling media treatment as that of the passing of Nelson Mandela.

It was mysteriously odd that the media could pay so much attention to the passing of one man. Had they got it wrong? Had they had too much time to prepare? Did they totally overrate a “news” event that by its very nature of imminent inevitability reduced its newsworthiness? Channel after channel; column after column; blog after blog; post after post; tweet after tweet, could speak of nothing else.

Stadia were filled with mourners from the august halls of political power to those from the streets. Endless queues snaked passed the earthly remains of a hero. Seldom, if ever before, had there been so much global outpouring of spontaneous lament. As a journalist I was confused. As a man on the eve of his 3 score years and ten, I shared the nostalgic pain.

Then hearts became still and we entered into a new year with the strains of Auld Lang Syne haunting our reflections of a time that was, a promise of the future. The likelihood of that memorable phrase in the lyrics of “taking a cup of kindness yet” is tempered by the stark reality that something much more than one man had died; that what he represented was gone for all time.

Then old men become melancholic.

They are saddened by the knowledge that the New Year will more than likely simply be a repeat of the old, more of the same. They mourn the passing of a concept: that our ultimate calling is to be of service to each other, that our real value is what we extend to others. It was that calling that was perhaps exaggeratingly personified in one man but that vaguely crystallized into a subconscious, inexplicable sense of loss, of auld lang syne, of times gone by.

It’s a deeply seated emptiness that may have prompted journalist Alec Hogg to moot the possibility of “What would Madiba do” becoming a South African clarion call, at the same time expressing a forlorn hope that this could take hold. It’s a disquiet that has perhaps sourced the outpouring of anger by investigative reporter Barry Sergeant at the corruption, collusion, cronyism and exploitation that permeates every fibre of our transactional lives and corporate and government offices.

Old men become forlorn when the blatant hypocrisy of many is thrown into sharp focus when, from a packed stadium broadcast to millions, they eulogise about the qualities of a man they came to honour, but clearly could never hope to emulate.

After decades of sipping at the cup of experience, observations and reflection, old men become perplexed when they witness the ailing demise of a very old friend; one that generally could be trusted to do the right thing; that ensured a balance of power and that spread enablement and empowerment by providing us with sustenance both in means and meaning and whose unwritten but clearly understood intention was to serve, reflected in behaviour that constantly wooed the approval and loyalty of those whom they served.

That friend is business. It now ranks as the second least trusted institution in society, second only to government. It has been afflicted with one of the most virulent behavioural diseases known to man: the demise of long term thinking, or short-termism. In the process, corporates have become larger, more pervasive, global and influential and have adopted a risk averse survival mode, accumulating, concentrating and growing capital delinked from creating tangible wealth; discouraging the trickling down of wider distribution of employment, wealth and opportunity. At the same time it has trampled on the principles of empathy, generosity and compassion, marginalising other constituents such as labour and customers.

In the increasing frenzy of quick returns, shareholders themselves have become impatient, with average holding shortening from about 8 years a half century ago, to about 5 days today.

But of course, they are not alone. The “want-it-all-want-it-now” immediate self-gratification symptom of the short-termism disease is everywhere, ultimately culminating in unrealistic expectations of government, and crushing levels of private and public debt. This debt is then “monetized” in increasingly worthless “promises to pay” that contaminates the means of exchange at its core.

Old men then lament the death of two critical attributes – patience and prudence – the key principles of one man prepared to languish in prison for decades and emerge without anger or vengeance.

It’s not that times were much better in their day – indeed in many respects they were arguably worse. All generations have their warts, and much of what we witness today is simply a repeat of history. What has changed is behaviour. The unwillingness to learn from the past and the failure to adjust behaviour exponentially increases the severity of an inevitable fall-out.

But as a species, humankind is not suicidal – unless it recklessly continues to challenge nature. But when finally confronted with the pain of its misguided path, it will adjust – as it has so often in the past. There is still an underlying and deep-seated benevolence in most of mankind. It exists in South Africa too and there is much that we can celebrate and be proud of.

It’s enough to lift old men out of their melancholy.