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August 3, 2009
2009 Special Midyear Trust Survey
Overview
• Conducted a special abridged version of the annual Edelman Trust
Barometer. We surveyed 1,675 opinion leaders in six of the world’s largest
markets: China, France, Germany, India, UK and US.
• To gauge impact of last six months – the bankruptcies, bailouts,
nationalizations, and exec comp scrutiny-- on trust in business and brands:
• Has business regained its footing?
• Who are opinion leaders looking to for leadership to solve key societal issues–
business or government?
• What are the new expectations for business and its role in society?
• How do companies restore lost trust?
• How does trust – or the lack of it – affect product brand decisions?
•
January 2009
In U.S., trust in business was at lowest level, including post-Enron
3
How much do you trust business to do what is right?
44% 44%
48%
51%
48%49%
53%
58%
38%
32%
41%
35%
40%
36%
38%
34%
36%36%
30%
35%
40%
45%
50%
55%
60%
2001 2002 2003 2004 2005 2006 2007 2008 2009
US UK/France/Germany
Informed publics 35-64 in the United States and UK/France/Germany
Responses 6-9 only on 1-9 scale; 9=highest
Enron, the dot-com bust
and September 11
20-point
drop
July 2009
Trust in business stable to up
How much do you trust business to do what is right?
Informed publics ages 25 to 64; responses 6-9 only on 1-9 scale; 9 = highest
4
36%
46%
30%34%
71%
62%
48%44%
41% 39%
75%
60%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
US UK France Germany India China
Jan 09 Jul 09
+12
+11
The 12-point increase in U.S. includes the younger sample of 25- to 34- year-olds,
whose overall trust in business increased 26 points in six months.
Trust in government stable to up
How much do you trust government to do what is right?
Informed publics ages 25 to 64; responses 6-9 only on 1-9 scale; 9 = highest
5
43%
35%38%
26%
44%
74%
30%
40%
34% 36%
42%
72%
42%38% 40%
44%
55%
78%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
US UK France Germany India China
Jan 08 Jan 09 Jul 09
+13
+12
The 12-point increase in U.S. includes the younger sample of 25- to 34- year-olds,
whose overall trust in government increased 24 points in six months.
Why? Tangible, quantifiable actions
6
58%
61%
62%
78%
80%
81%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Continued to spend money on philanthropy
Reduced marketing budgets
Closed non-profitable business units
Fired non-performing management teams
Reduced CEO and executive pay
Repaid bailout or loan money to the government
Would you trust a company more or less if that company took this action?
Informed publics ages 25 to 64
Responses 6-9 only on 1-9 scale; 9=highest
July 2009
The state of trust in six countries
7
51% 51%
70%
46%
52% 50%48%44%
41% 39%
75%
60%
42%38% 40%
44%
55%
78%
37%
28%
35%39%
53%
67%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
US UK France Germany India China
NGOs Business Government Media
How much do you trust each institution to do what is right?
Informed publics ages 25 to 64; responses 6-9 only on 1-9 scale; 9=highest
January 2009
In U.S., trust in every industry had declined; banks and automotive led the way
How much you trust businesses in each of the following industries to do what is right?
69%
60%
44%
49% 50%
58%
64%
54% 54%
73%
63%
80%
36%33%
25%
31%33%
42%
49%
40%42%
62%
54%
73%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2008 2009
8
-33
-27
Informed publics ages 35 to 64; responses 6-9 only on 1-9 scale; 9=highest
Technology most trusted industry in five of the six countries
9
80% 81%
72%
62%
93%
88%
72% 71%69%
56%
86%84%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
US UK France Germany India China
Technology Food Healthcare Biotech/life sciences Retail Banks
Technology
#3 in France
(66%)
How much do you trust businesses in each of the following industries to do what is right?
Informed publics ages 25 to 64; responses 6-9 only on 1-9 scale; 9 = highest
But We’re Still
in the Middle of the Game
1% 1%
24%
10%
34% 34%
10%17%
29%
37%
22%28%
17%
12%
18%24%
19%
24%
59%59%
25% 24%23%
12%12% 10%
5% 5% 2% 1%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
India China US Germany France UK
Excellent
Good
Neither good nor bad
Fair
Poor
Reputation of MNCs struggling in West
11
Informed publics ages 25-64 in six countries; Responses Excellent, Good, Neither good nor bad, Fair, and Poor
How would you describe the overall reputation of large global businesses?
13%24%29%30%69%71%
Reputation
rated good
or excellent
20%
9%
40%
33%
38%
55%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Has government
intervened enough in
global business?
Business is not doing enough to help solve economic crisis
12
Have global businesses
cooperated enough with
government?
Informed publics ages 25-64 in six countries; responses Too much, The right amount and Not enough
Too much Too much
Right
amount
Right
amount Not enoughNot enough
“The social
responsibility
of business is
to increase its profits.”
Milton Friedman, 1970
Stakeholder, not shareholder, world
14
70%
58%
49%45%
40%
26%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Customers Employees Investors Society Local Communites*
Government
How important do you believe the interests of each of the following stakeholders
should be to a CEO’s business decisions?
* Communities where the business operates
Informed publics ages 25-64 in six countries
Extremely important responses only
“Hard and soft” measures needed to rebuild trust
15
Informed publics ages 25-64 in six countries
Responses 6-9 only on 1-9 scale; 9 = highest
43%
66%
69%
69%
70%
70%
75%
78%
81%
82%
82%
82%
89%
90%
91%
93%
93%
94%
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Protect profit margins
Increase shareholder value
CEO appearances
Discount pricing
Eliminate financial incentives for taking risks
Communicate messages through multiple media channels
Pay senior executives mostly in stock
Reduce the gap between CEO and average workers pay
Commit resources to the public good
Increase profitability and performance
Partner with third parties to solve major global problems
Make progress on environmental initiatives
Drive better innovation
Create and keep jobs
Communicate frequently and honestly
Transparent and honest business practices
Keep producing quality products and services
Treat employees well
Would trust a company more or less for taking each of the following actions?
Business expected to take on global issues
16
85% 84% 82% 80%76% 75% 73%
Manage business operations to ensure companies survive
global economic crisis
Ensure efficiency of business operations
Create solutions to reduce energy costs
Cooperate with government to help
solve the global economic crisis
Provide access to affordable healthcare
Create solutions to minimize global
warming
Promote free trade
How important do you believe it is for business to do each of these things?
Informed publics ages 25 to 64Responses 6-9 only on 1-9 scale; 9 = highest
But MNCs have not taken enough action
17
71% 70%
64%
55%52%
49%
Create solutions to minimize global
warming
Create solutions to reduce energy costs
Provide access to affordable healthcare
Cooperate with government to help
solve the global economic crisis
Manage their business operations to ensure that their companies
survive the global economic crisis
Ensure efficiency of business operations
In U.S.: 62%
Informed publics ages 25 to 64; not enough responses only
Have global businesses taken too much, the right amount, or not enough action on each of these things?
In U.S.: 55%
In U.S.: 65%
In U.S.: 68%
In U.S.: 56%In U.S.: 57%
“NOT ENOUGH”
The Role of Trust
in Product Marketing
Informed publics more likely to switch brands because of
something positive they read, saw, or heard about that brand
19
Informed publics ages 25 to 64 in six countries
Yes responses only
29%
33%
45%
48%
53%
62%
Connected with a brand through a social networking site
Lost trust in a brand because of poor financial performance of the parent company
Switched brands because you stopped trusting a brand
Switched brands because of something negative you read, saw or heard about that brand
Switched brands because another brand cost less
Switched brands because of something positive you read, saw or heard about that brand
In recession,
cost only
marginally
more
important
than trust
Have you taken any of the following actions in relation to product or service brands that you use?
Quality, reliability, and past personal experiences most important factors in determining how
much one trusts a product or service brand
20
Informed publics ages 25 to 64; responses 6-9 only on 1-9 scale; 9 = highest
22%
39%
42%
57%
59%
67%
68%
75%
79%
81%
83%
88%
90%
94%
94%
96%
Endorsement by a celebrity
Endorsement by a public figure
Advertisements
Positive media coverage
Financial performance
Recommendation from an expert
Association with a good cause
Recommendation from a person like you
Recommendation from friends or family
Innovation
Company reputation
Value
Safety
Past personal experiences
Reliability
Quality
How important are each of the following factors in determining how much you trust a product or service brand?
Study conclusions
• Trust has either stabilized or risen, but we’re only in the middle
of the game
• Tangible, quantifiable corporate actions have led to trust rise – repaying
loans, cutting executive comp, firing poor management
• Moving from shareholder to stakeholder world
• “Hard and soft” measures rebuild trust – quality products, treating
employees well, transparency, frequent communication
• Business expected to partner with government and NGOs to address
economy, energy, environment, healthcare
• Trust plays key role in brand choices
The way forward for business
• No quick fix through a single set of actions: long-term proposition
• Play a broader role in society; collaborate more
• Balance investor interests with customer and employee interests
• Square mutual social responsibility and shared purpose with
profit-making strategy
• Communicate frequently and transparently
A Ten Year Overview of Trust
The 2009 Midyear Edelman Trust Survey was produced by research firm StrategyOne.
Methodology: The survey consisted of 15-minute telephone interviews from May 26 to July 3, 2009.
The survey sampled 1,675 informed publics in two age groups (25-34 and 35-64) in six countries:
U.S., U.K., France, Germany, China, and India. The respondents were college-educated, in the top
25% of household income per age group in each country, and reported significant media
consumption and engagement in business news and public policy.
U.S.: N= 500 (ages 25-34: n=100; ages 35-64 n=400)
China: N=375 (ages 25-34: n=75; ages 35-64 n=300)
U.K., France, Germany, India (per country): N=200 (ages 25-34: n=50; ages 35-64 n=150)
For more information on the Edelman Trust Barometer and to view past results, please visit
www.edelman.com/trust.
.
August 3, 2009
2009 Special Midyear Trust Survey