trust

2011 Edelman Trust Barometer Executive Summary

 Business and Government: Trust Stabilizes Globally
In a year marred by corporate crises and financial turmoil for European governments, the 2011 Edelman
Trust Barometer finds trust in business and government markedly resilient and sees a shifting center of
gravity. Trust in NGOs, “the fifth estate” in global governance, stays strong.

In this year’s Barometer, a three-part Figure 1: Emerging markets dominate as “business trusters;” U.S. drops
picture emerges of trusters, neutrals,
to within 5 points of Russia (Top 10 GDP countries)
and distrusters of business and gov-
ernment (figures 1 and 2). Countries How much do you trust business to do what is right?
hovering in the 50 percent-range, so
called “neutrals,” occupy a middle Trusters Neutral Distrusters
ground as the divide widens between 100

trusters (over 60 percent, including 90

+19
Brazil and China) and distrusters 80
(under 50 percent, including the U.S., 81%
+12 -8
70 +12
U.K., France, and Russia). 70%
60 67%
62% 64% 62%
59% 61% 57%
The United States, which last year 50 54%
53% 52% 49%
enjoyed an 18-point spike in trust in 40 48% 46% 44% 42%
business, saw an eight-point drop, 40% 41%
30 36%
placing the world’s largest economic
20
power within five points of last-place
10
Russia. Trust in government tumbled
in the U.S., where the two political 0
Brazil India Italy China Japan Germany France U.S. U.K. Russia
parties were at loggerheads (see
page 4 for more on the U.S.). 2010 2011 2010 2011 2010 2011

In the early years of the Barometer, Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64

trust in business and government

tended to move in opposition. In- Figure 2: China and Brazil drive rise in trust in government; U.S. now on par
creased trust in one was met by
decreased trust in the other. We
with Russia (Top 10 GDP countries)
generally now see the two moving How much do you trust government to do what is right?
in tandem, an important step as the
expectation is for the world’s two dom- Trusters Neutral Distrusters
inant institutions to work together. 100

90
+14 +46
The predominant exception is Ger- 80
88%
85%
many, where trust in business is up
70 74%
by 12 points, but trust in government -6 -10
60
is down by 10 points—to 33 percent,
the lowest of the top 10 economies. 50
51% 49%
In Germany, business is now enjoying 40 43% 45% 43% 44% 43%
46% 43%
42% 40% 38% 39%
the benefit of the Hartz labor reforms, 39% 38%
30 36% 33%
but the government is seeing wide-
20
spread opposition to the country’s
10
bailout of troubled European nations.
0
China Brazil Japan France Italy India U.K. U.S. Russia Germany

2010 2011 2011 2010 2011

Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64

2 2011 EDELMAN TRUST BAROMETER

Trust in Banks Plunges in West; Technology
Holds Firm at No. 1; Automotive Rallies

Technology, which is in the No. 1 spot Figure 3: Banks’ reputation plummets in West, while tech stays high
for the third straight year, is now
worldwide; automotive climbs across the globe
followed by automotive and telecom-
munications. In the U.S., where GM How much do you trust the following industries to do what is right?
posted the largest IPO in history,
the automotive industry earned back Banks Technology Auto
half of the trust it had lost in 2009. 100 +12 +21 93% 93%
The starkest contrast, however, is 90% 98%
90 87% +7 85%
83% 82% 80%
between technology and banks 78% 77% 78%
80 -46
(figure 3). The dramatic three-year 71%
73%
69%
73%
70 75%
drop in trust in banks in the West
-30
keeps this industry stuck at the bot- 60
+17 53%
49% 48%
tom in global industry rankings. By 50 46%
contrast, in China, where banks are 40
credited with financing increased 32%
30 25%
prosperity, trust surged by 12 points
20 16%
to 90 percent.
10
All four BRIC countries have gained 0
trust as headquarter countries for China India U.S. U.K. China India U.S. U.K. China India U.S. U.K.
global companies (figure 4). The trust 2008 2011 2008 2011 2009 2011
comes mainly from fellow emerging
markets, indicating that the BRIC Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64
strategy to target emerging econ-
omies is producing results. However,
when compared to Germany and Figure 4: Trust in BRIC-based Figure 5: Trust in NGOs on par with
Canada, longtime leaders in the
companies rises business in emerging markets
most-trusted-headquarter-country
category, the BRICs still have a How much do you trust global How much do you trust business to
ways to go to be considered reliable companies headquartered in the do what is right? How much do you
business hubs. following countries to do what is right? trust NGOs to do what is right?

In 16 of the 23 countries surveyed, 100 100

NGOs are as or more trusted than 90 90

business. Historically trusted most in 80 75%76% 76%75% 80
developed markets, NGOs continue +3 81% 80%
70 70
to gain trust in emerging markets +4 +5
60 +5 60
(figure 5). In Brazil and China, where 61% 63%
NGOs are on par with business, 50 50 55% 55%
40% 39% 42%
39% 48%
higher economic levels come with 40 36% 34% 35% 40 46%
30%
a greater concern for environmental 30 30
responsibility, education, and public 20 20
health, the very province of NGOs.
10 10

0 0
Germany Canada Brazil India China Russia Brazil China U.S. U.K./Fr/Ger

2010 2011 2010 2011 Business NGOs

Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64

3
 The United States: The Stark Exception
In a reversal of last year’s
uptick, the U.S. suffers an
across-the-board tumble, with
declines in all four institutions.
Figure 6: In U.S., 2011 decline mirrors 2008-2009 drop; only country
to see trust fall in all four institutions
Trust in institutions: 2008-2011
70

65 63% 63%
The downturn in trust in the U.S. in
2010 echoed the drop that resulted 60
Worldwide
from the worldwide financial crisis. 59% 54%
55 financial crisis 55%
While not as steep a decline, the
50
country lost half the gains it earned 46% 45% 46%
back in 2009 (figure 6). 45 46%

40 43% 36% 40%

Several explanations emerge for
35
the grim U.S. picture: the prolonged 31% 38%
fighting between business and 30
30%
government; unemployment rates— 25
27%
not the full recovery the country
20
expected; and the nation’s spot as
Jan 2008 Jan 2009 Jan 2010 Jan 2011
the epicenter of many of the head-
line crises of 2010, including the oil
spill, product recalls, and the SEC Responses 6-9 only on 1-9 scale; 9=highest NGOs Business Government Media
Informed publics ages 25 to 64
investigation of Goldman Sachs.

A four-year view paints a bleaker

picture according to the Trust
Barometer Index, in which each
country’s score is an average of Trust Barometer Index U.S. drops while Brazil rises in composite scoring
its trust in business, government,
NGOs, and media. The U.S., fourth 2008 2011
from the top in trust in 2008, sinks to
the bottom this year, barely above Global — Global 55
the U.K. and Russia. On the other Mexico 69 Brazil 80
hand, the BRICs hew closer to their China 62 China 73
2008 rankings, with the exception India 60 Mexico 69
of Brazil, which climbs sharply. 56
U.S. 53 India
Japan 50 Canada 55
But if American business is largely not
S. Korea 50 S. Korea 53
trusted by Americans, the opposite
appears to be the case for American Canada 48 Japan 51
business abroad. Continuing a trend Brazil 48 France 50
we have seen in recent years, trust France 44 Germany 44
in U.S.-based multinationals moved U.K. 43 U.S. 42
up in many markets, including China Germany 36 U.K. 40
(+15), Brazil (+16), India (+16), and Russia 36 Russia 40
Indonesia (+16), possibly a halo
effect of President Obama’s good
standing abroad.
Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64
Composite score is an average of a country’s trust in business, government, NGOs, and media

4 2011 EDELMAN TRUST BAROMETER

Credentials Count More Than Ever
Trust in experts rises—and after years of being at or near the bottom, CEOs see increase
in credibility.

Trust in all credentialed spokes-
people is higher this year, signaling a
desire for authority and accountability
—a likely result of the skepticism
wrought by last year’s string of
corporate crises. Since 2009,
academics and experts—long the
front-runners—earned another eight
points to climb to 70 percent. For
the first time, the Barometer asked
about the credibility of a company’s
technical expert who is, in turn,
deemed “very” or “extremely credible”
by a vast majority (64 percent).
CEOs are now in the top tier of
trustworthy spokespeople, a strik-
ing shift from two years ago when
they sat second from the bottom
(figure 7). Fifty percent say CEOs
are credible spokespeople about
a company, a 19-point increase
over 2009.
By contrast, a “person like me”
dropped by four points globally in that
time, falling from the top three to
the bottom two, virtually swapping
spots with the CEO. This may be a
result of changing attitudes about
what constitutes “a person like me,”
rather than an indication of a signifi-
cant decrease in the actual credibility
of peer-to-peer communication. With
some estimates indicating that the
average Facebook user does not
know one-fifth of the 500 people
typically listed as friends on his or her
page, it is reasonable to ask whether
the meaning of the word “friend”—
and by association “a person like
me”—has become devalued.
In the wake of last year’s crises,
the Barometer posed a series of
questions about who should speak
for a company in a challenging
time. “Multiple voices” is the first
conclusion drawn, as CEOs, third
parties, company chairmen, and
technical experts all have a role to
play when a company confronts
a crisis. In the case of a product
recall, the technical expert and
the CEO are the preferred spokes-
people (30 percent and 37 percent,
respectively). In a situation where
the local community has been
damaged, more people want to hear
from the CEO (38 percent) than
they do a third-party representative
(17 percent), government official
(12 percent), or company technical
expert (11 percent).

Figure 7: CEOs lead rise in trust in authority, but “person like me” drops amid flight to credentialed spokespeople
If you heard information about a company from one of these people, how credible would that information be?

2009 2011

Academic/expert 62% Academic/expert 70%

Financial/industry analyst 49% Technical expert in company 64%

Financial/industry analyst 53%

Person like yourself 47%
CEO 50%
NGO representative 41%
NGO representative 47%
Regular employee 32%
Government official 43%
CEO 31% Person like yourself 43%

Government official 29% Regular employee 34%

Informed publics ages 25 to 64 in 20 countries

“Extremely credible” and “very credible” responses only

5
 Surround Sound Needed in Time of Skepticism
A jumbled media landscape and Figure 8: Developed markets more distrustful of media (Top 10 GDP countries)
the domino effect of corporate How much do you trust media to do what is right?
and government crises have
Trusters Neutral Distrusters
increased skepticism in key 100
+17
Western nations. 90 +19
80
80%
70 73%
While trust in media as an institution 60
+12 -11
63%
inched up globally, it declined signifi- 50 54% 58% -9
50% 48% 45% 45%
cantly in the U.S. and the U.K. (figure 40
39% 37% 37% 37% 38%
36% 36% 38%
8). As in 2009, the majority need to 30
31%
27%
hear something between three and 20 22%
five times to believe it (figure 9). But in 10

the U.S. and the U.K., approximately 0

China Brazil India Japan France Italy Germany Russia U.S. U.K.
one-quarter say they need to hear
2010 2011 2011 2010 2011
something six or more times to believe
it, twice as many as two years ago. Responses 6-9 only on 1-9 scale; 9=highest; Informed publics ages 25 to 64

Search engines rank No. 1 as the

place people go first for informa-
Figure 9: Repetition enhances credibility
tion about a company, followed 10+ times Don’t know
by online news sources, print, and 6-9 times 6% 2% Once
8% 4%
broadcast media (figure 10). Their How many times in general do
second stop is on the screen as you need to hear something
Twice
well, with 23 percent saying they about a specific company to 22 %
go to online news sources, which believe that the information
4-5 times
do include the Web versions of is likely to be true? 26%
traditional media like newspapers
and television. Thirty-three percent
Informed publics ages 25 to 64
globally say they trust newspapers 3 to 5 times
in 23 countries
59%
a great deal, followed by 31 percent 3 times
33%
who say the same for television.

The data portray a savvy consumer Figure 10: Search engines “go-to” source; online news second
who turns first to search engines
to see what is available on the topic Where do you generally go first for news about a company? Then where do you go?
of interest, and who then seeks
out traditional media to confirm First Source Second Source
or expand on what he or she has
learned. Information ubiquity has Online search engine 29% Online news sources 23%
changed the playbook for corporate Online news sources 19% Print (newspapers/magazines) 17%
communications, the data suggest,
signaling to companies that they Print (newspapers/magazines) 15% Online search engine 16%
cannot simply be present with their Broadcast (radio/TV) 12% Broadcast (radio/TV) 14%
messages, but rather must be
omnipresent through an approach Company website 11% Company website 11%
that encompasses mainstream, new, Friends and family 7% Friends and family 10%
social, and owned media.
Social media 5% Social media 7%

Informed publics ages 25 to 64 in 23 countries

6 2011 EDELMAN TRUST BAROMETER

Trust Is a Protective Agent
Trust has tangible value. Companies that are distrusted and facing an onslaught of negative news will
have a harder time changing opinion after the storm than they would if they were trusted at the outset.

This year’s Barometer explored Figure 11: Quality, transparency, trust, and employee welfare most
whether trust can diminish the impact
important to corporate reputation
bad news has on a company. The
answer is yes (figure 12). Fifty-seven How important are these factors to corporate reputation?
percent will believe negative infor-
mation about a company they do
not trust after hearing it just once
High quality products or services 69%
or twice. When a company is trusted,
however, only 25 percent will believe Transparent and honest business practices 65%
negative news about it after hearing Company I can trust 65%
the news once or twice. The same
Treats employees well 63%
holds true for positive information,
with far fewer believing good news Communicates frequently 55%
about a distrusted company. These
Prices fairly 55%
findings send a strong signal that
corporate leaders would be well Good corporate citizen 51%
advised to create a trust foundation Innovator 46%
so that positive information has an
Widely admired leadership 39%
echo chamber in which to resonate.
Financial returns 39%
The most important corporate repu-
tation factors remain quality products,
transparency, trustworthiness, and Responses 8-9 only on 1-9 scale; 9=highest. Informed publics ages 25 to 64 in 23 countries
employee welfare, while a company’s
financial performance is tied at
the bottom with its having widely
admired leadership (figure 11).

Figure 12: Trust protects reputation

When a company is distrusted When a company is trusted

57% will believe

negative information
after hearing it 1-2 times 51%
57%
will believe
need to hear positive
positive information
information 3-5 times
to beleive it
after hearing it 1-2 times
will believe
positive information
15% after hearing it 1-2 times 25%
will believe
negative information
after hearing it 1-2 times

Informed publics ages 25 to 64 in 23 countries

7
 The Transformation of Trust
Trust in business may have stabilized Figure 13: Expectations high for business to invest in society
globally, but it is different and condi-
tional, premised on what a company A. Agree: Should corporations create shareholder value in a way that aligns with
does and how it communicates. In society’s interests, even if that means sacrificing shareholder value? B. Agree: Should
this transformation, there are new government regulate corporations’ activities to ensure business behaves responsibly?
expectations for governments, cor- 100
porations, and leaders—as well as a 91% 89% 89% 89%
90 85% 85% 85%
new architecture for earning trust. It 82% 81% 81%
80% 79% 78% 78%
supplants the “fortress framework” in 80 82% 82% 74% 73%
72% 71% 71%
which corporations have customarily 70
70%
74% 73% 67%
63% 62%
69% 67%
protected their brands, controlled 60 62% 61%
66%
63% 61% 63%
58%
information, and given short shrift to 50 56% 57% 55%
53% 53%
partners, aiming to maximize returns 48%
40 50% 44%
solely for shareholders. The new 49% 42%

model, a “trust triangle,” is based on 30

the expectation for companies to act 20

collaboratively to benefit society not 10
just shareholders (What); be trans- 0
parent about their operations and
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Informed publics ages 25 to 64 in 23 countries Question A Question B
all forms of media—mainstream, new,
social, and owned (Where). Trust is no
longer a commodity that is acquired,
but rather a benefit that is bestowed. Old Trust Framework New Trust Architecture
Business has the opportunity to build Control Information
an enduring foundation of trust by
asking its leaders to commit to a
strategy that brings value to both
Protect the Brand

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investors and society.

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Richard Edelman
President and CEO, Edelman WHAT
Focus Solely on Profit Profit with Purpose

About the Edelman Trust Barometer About Edelman

The 2011 Edelman Trust Barometer is the firm’s 11th annual trust and credibility
survey. The survey was produced by research firm StrategyOne and consisted
of 30-minute telephone interviews conducted from October 11-November 28,
2010, with the exception of France and Germany, fielded January 3-13, 2011.
The 2011 Edelman Trust Barometer survey sampled 5,075 informed publics in
two age groups (25-34 and 35-64) in 23 countries. All informed publics met
the following criteria: college-educated; household income in the top quartile for
their age in their country; read or watch business/news media at least several
times a week; follow public policy issues in the news at least several times a week.
For more information, visit http://www.edelman.com/trust or call 212.704.4530.
Edelman is the world’s largest independent public relations firm, with wholly-owned
offices in 53 cities and 3,700 employees worldwide. Edelman was named Advertising
Age’s top-ranked PR firm of the decade and one of its “2010 A-List Agencies” and
“2010 Best Places to Work;” European Excellence Awards’ “2010 Agency of the
Year;” PRWeek’s “2009 Agency of the Year;” Holmes Report’s “Agency of the Decade”
and “2009 Asia Pacific Consultancy of the Year;” and among Glassdoor’s top five
“2011 Best Places to Work.” Edelman owns specialty firms Blue (advertising),
StrategyOne (research), Ruth (integrated marketing), DJE Science (medical education/
publishing and science communications), and MATTER (sports, sponsorship, and
entertainment). Visit www.edelman.com for more information.
© Edelman, 2011. All rights reserved.

On the cover, from top left: newspaper stall in Dublin, Ireland; Wikileaks founder Julian Assange at press
conference; oil-soaked pelican in wake of BP Deepwater Horizon rig explosion; Goldman Sachs chairman
and CEO Lloyd Blankfein testifies before Senate Subcommittee on Investigations; unemployed worker
holds sign at rally; Dilma Rousseff, Brazilian president, receives presidential sash from Lula da Silva;
relatives of Foxconn employees mourn family members following suicides at Chinese manufacturer.

8 2011 EDELMAN TRUST BAROMETER