Leaders need a better understanding of “public trust,” what factors influence it, and what that means for organizational action.
We understand a great deal about organizational trust, but research generally assumes that all parties view trust in organizations the same way. Stakeholder trust – or, an analysis of differential stakeholder approaches to trust – has been relatively unexplored, with a few notable exceptions.
What role can stakeholder theory play in understanding public trust in the institution of business?
How do different stakeholders conceptualize organizational trust, and what impact do these differences have? What does a better understanding of stakeholder trust tell us about public trust in business?
Trust has at least two key components – trust that is based upon an assessment of integrity or goodwill and trust that is based on an assessment of competence. Competence-based trust may be a higher priority in certain stakeholder relationships, whereas in others goodwill-based trust may be more important. Recognizing and understanding which aspect of trust has priority in particular stakeholder relationships, and understanding how those stakeholders balance these two aspects of trust in their decisions, would be highly useful to business leaders.
At the individual level, trust in the institution of business and trust in a particular business are distinct concepts.
Stakeholder roles (e.g., customer, employee, investor) differ qualitatively and engender different areas of emphasis when it comes to organizational trust; this has an important bearing on trust in business as an institution.