Prior to our webinar and publication of a new GlobeScan report that aims to surface the main challenges, most compelling opportunities, and best practices in trust management, we asked GlobeScan CEO, Christophe Guibeleguiet, for his views on how corporate affairs professionals can manage trust risk within their organizations.
Based on your experience of advising multinationals, and engaging with their stakeholders, what are the main challenges facing global organizations today?
The challenges are both strategic and operational.
Strategically, shifting stakeholder demands and expectations are very challenging to respond to. At the strategic level which guides business decisions, and relations with government authorities and regulators, it is difficult to maintain an appropriate level of influence while anticipating regulatory changes. These are persistent sources of uncertainty for companies.
Operationally, the pressure to deliver impeccable records on environmental and social performance will continue to grow as more and more businesses are aiming for deeper integration of sustainability practices throughout their supply chains. Growing expectations for aligned standards around responsible sourcing, counterparty risk assessment, and human rights also mean that effective oversight of supply chain management will require an increased amount of dedicated resources. This is likely to challenge companies’ operations both from an organizational and financial perspective.
How does the notion of trust fit within this challenging context?
Trust has never been as high on a company’s agenda as it is today, as many global businesses are critically lacking it. Corporations cannot effectively address the set of challenges without first addressing the issue of trust deficiency. The stakes are high and the risks are well known for organizations that do not have trust: loss of reputation, disruption in the stakeholder ecosystem, financial turmoil, and in the worst case scenario a re-shuffle on the management deck. The need to manage trust as an over-arching risk is therefore of significant importance.
So what do you see as the critical drivers of trust to act upon from the perspective of communications and corporate affairs professionals that will help them respond to the numerous challenges lying ahead?
Corporations have to be prepared and organised to protect and grow the ever-fluctuating trust levels between the business and their stakeholders. This can be done by using a framework that deconstructs trust to better understand what fuels it. Our point of view is that trust is built on three interconnected components: operational competency – evidencing consistent pillars of performance that support impeccable delivery of quality products and services; integrity – demonstrating strong ethical values and behavior when delivering on the value proposition; and benevolence – conveying an explicit sense of purpose that aims to create value for the business, its stakeholders, and society at large.
Activating these three components simultaneously will earn companies sustained levels of what we call thick, or opportunity-creating, trust.
What are the implications of this new trust landscape for the corporate affairs and communication function?
Structural changes are happening for the remit. The role of corporate affairs practitioners is evolving alongside the required skills and versatile palette of expertise needed to respond to the ever more diverse and ubiquitous challenges: anticipating social, environmental, and political trends is paramount, while understanding the levers of trust and how to activate them is leading to new best practises in trust risk management. All of this is revamping corporate affairs as a value-driven function at the core of business strategy.
Greater cross-function collaboration is another outcome of this new approach to trust risk. Collaboration is on the rise between the corporate affairs function and the sustainability team or the CEO’s office, for example.
Can you elaborate on this evolution towards greater collaboration? Does corporate purpose have a strong role to play in enhancing stakeholder engagement?
It does, both internally and externally. Internally, collaboration is facilitated by the increased prominence of corporate purpose in the agenda of corporate affairs. The development of a corporate purpose offers more opportunities to engage internally with different functions – to streamline a consistent narrative communicated across all corporate channels, secure greater employee identification with it, and achieve more effective integration into business decisions.
Corporate purpose also provides a catalyst for external engagement activities that will ultimately drive trust value. In resonance with the new thick trust landscape, stakeholder engagement is increasingly moving from transactional relationships to dynamic, authentic and purpose-driven networks of collaboration. This makes corporate purpose incredibly relevant and compelling to support stakeholder engagement, particularly if it relies on solutions-centred, innovative engagement practices.
In this regard, new approaches like campaign-based strategies or stakeholder advisory boards, though promising, have yet to become more mainstream tools in companies’ engagement arsenals. Their greater deployment will contribute to the end goal of stakeholder engagement and ensure it becomes a more effective lever of trust risk management than it currently is.
