Many executives think that delivering on promises is all they need to do to win the trust of others, but research suggests that inspiring trust is much more complex – and HR leaders can play a critical role in this process, according to an expert on executive trust.
“HR leaders are in an excellent position to help executives develop ability, integrity and benevolence,” said John Blakey, a board chair, executive coach and author of The Trusted Executive.
“Firstly, they can help educate executives on the real nature of trust … HR leaders can share insights on trust through blogs, newsletters, conferences and leadership.
“This all helps educate leaders on this important topic.”
Second, Blakey said HR leaders can help with the trust-building challenge by pushing for the measurement and tracking of a “trust index” for the organisation as a whole.
“Many believe that trust is too subjective to be measured, but fifteen years ago we would have said the same about employee engagement, yet now there are many established measures for this important success factor,” he said.
“What gets measured gets treasured, so creating a ‘trust index’ starts this process of elevating the importance of trust.”
Thirdly, Blakey said HR leaders can help by becoming role models for trustworthy behaviour.
“Leading by example is a powerful means of influencing others,” he said.
“If HR leaders master nine habits (coach, be consistent, be honest, be open, be humble, evangelise, be brave, be kind and deliver) that underpin ability, integrity and benevolence then they become part of the solution rather than part of the problem.”
“Executives who master this habit will have the courage to subordinate their own personal financial rewards to the wider trustworthiness of the organisation”
If organisations wish to identify and promote trustworthy executives then the ability, integrity and benevolence of potential candidates will need to be assessed via performance appraisal processes, he added.
“In the same way that leadership competencies have been used for this purpose then the nine habits of trustworthy behaviour can be assessed both by the executive themselves and also by the other stakeholders with which they interact, including clients, staff, customers, peers, partners and line managers,” said Blakey.
“It is critical to adopt a 360 degree approach to assessing trustworthiness because often an executive can build trust with one stakeholder group (such as customers) at the expense of another stakeholder group (such as suppliers).
“This reveals that trustworthiness for that executive is an expedient tactic rather than a personal trait.”
Ultimately, Blakey said the culture must institutionalise trust into its processes and systems for this to drive consistent decision-making in the areas of succession planning and promotion.
“Like all such initiatives, sponsorship, endorsement and role-modelling from the CEO is a helpful pre-requisite,” he said.
“Leading by example is a powerful means of influencing others”
The benefit of building trustworthy executives is that such leaders will drive the organisation to deliver success at the triple bottom-line of results, relationships and reputation, Blakey added.
“In the eighties, it was sufficient to deliver results, and then in the nineties we learnt about emotional intelligence and we added the need for business leaders to deliver results and relationships,” he said
“In the 21st century, we are experiencing that the ambition of executives needs to go even further to embrace the longer term reputation of their own and the company’s brand.
“Hence the need to focus on the triple bottom line of results, relationships and reputation and to use trust as the catalyst for this agenda.”
Recent events at Volkswagen Group have shown how disregarding reputation will undermine results and relationships in a way that would have been hard to envisage fifteen years ago, Blakey pointed out.
The long term cost to Volkswagen of taking liberties with its reputation and focussing only on short-term results is estimated at $18 billion: “these are numbers that should make us sit up and take notice,” he said.
“This is the new reality of operating in a world where nothing can be hidden.”
“We are experiencing that the ambition of executives needs to go even further to embrace the longer term reputation of their own and the company’s brand”
Blakey said Unilever is a great example of an organisation that is pioneering with shifting the purpose of its business and creating new role models for executive trustworthiness, such as its CEO, Paul Polman.
Blakey explained that Polman worked closely for many years with the company’s global VP of HR, Geoff McDonald, who said there are five levers that need to be addressed in this process:
- leadership development
- structure and governance
- processes, policies and systems
- agreeing an audacious purpose and aligning goals with this purpose
- partnerships and collaboration
“I would add one more challenge – the thorny topic of executive remuneration,” said Blakey.
“For so long as the man or woman in the street perceive the distribution of pay between CEOs and their staff to be fundamentally unfair, then this will limit the degree to which they will trust executive leaders.”
Blakey explained that habit number seven of the nine habits of trustworthiness is “choosing to be brave”, and he said this means choosing to be morally brave to put the interests of others ahead of your own.
“Executives who master this habit will have the courage to subordinate their own personal financial rewards to the wider trustworthiness of the organisation,” he said.
“For this reason, I firmly believe we will see more corporate CEOs volunteering to take pay cuts and ‘give away’ bonuses in the coming years.
“This is the coming sea change in organisational life.”
Its advent will reawaken the basic humanity of these corporations, according to Blakey.
This is “a humanity that was outsourced in the ‘machine-age’ yet in the ‘social age’ will miraculously reappear” and against this backdrop, he said it is “truly an exciting time to be an HR leader”.
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