Article appeared last week on The FCPA blog.
Jes Staley is the newly appointed American CEO of the beleaguered British Barclays Bank. He recently said, “I do believe that trust is returning to our institution. But we will never rest, we are never done. We have to focus on building that trust every day.”
We asked our Trust Alliance members to weigh in on the steps Barclays new American CEO should take to build trust and ethics.
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Elizabeth Doty of Leadership Momentum emphasized the importance of building on the company’s new purpose and values, by making clearer, stronger commitments to stakeholders.
Though outsiders can never know a company’s internal reality, Mr. Staley’s comments show that he recognizes that trust is earned by being trustworthy. It is also positive that Mr. Staley’s predecessor, Mr. Jenkins, clarified the company’s purpose and values, and outlined specific behaviors, such as “I honor my commitments.”
Still, given the turmoil of repeated leadership changes and reorganization, Mr. Staley and his team are likely to face serious credibility challenges, regardless of their intent.
The purpose of a commitment is to reduce others’ uncertainty, so they feel less risk in trusting us. Making and keeping meaningful commitments is a powerful way to proactively demonstrate trustworthiness.
Yet, despite Barclay’s clarification of its purpose and values, stakeholders are still left with their primary uncertainty: How will you make tradeoffs under pressure?
For example, Barclay’s could commit to doing whatever most contributes to a customer’s goals, or to a level playing field in the market.
The key will be not to underestimate the challenges of re-shaping their culture to get there.
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Davia Temin, a leading reputation and crisis response consultant, spoke about the trust challenges continuing to plague most of the largest global financial institutions years after the 2008 financial meltdown.
Rebuilding trust in financial institutions is a complex algorithm that can test the skills of the best financial engineering “rocket scientist.”
Far from simply making a pronouncement of one’s intent (although that can be the first step), the organization needs to first deconstruct all the elements that went into building trust in their particular firm in the first place, analyze all the things that went wrong, and then construct a plan to overcorrect the breaches. Because simply fixing them will not rebuild trust, it will only, maybe, stop the erosion.
But this is seriously hard work.
Barclays, as most banks, has a number of critical audiences, each of whom needs a different set of fixes in order to begin to restore their trust. And some of those fixes are in direct conflict with others. Individual customers, shareholders, institutional clients, counterparties, regulators and legislators in every country in which they operate, and even the public at large must each feel that the bank puts their interests in front of its own.
Because it has been the self-dealing aspect of financial institutions’ behavior that did the most damage to their reputations and caused the greatest loss of trust.
So, to rebuild trust, Barclays and others will need to show their audiences that the bank puts them first…and that’s a hard thing to do and remain profitable. But it is almost impossible to make such a promise and then ignore it, or to fail in its announced attempt.
So, now that Mr. Staley has thrown down the gauntlet, perhaps he can get his financial product rocket scientists to reverse-engineer all the elements that went into the losing of public trust, share them with us all, and then announce how he will redress them, one by one. That, indeed, just might work, and would be my prescription.
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And finally Bob Whipple of Leadergrow reminded us where trust starts in all institutions.
It sounds like a lot of problems have been swept under the rug for some time and are impacting all facets of Barclays. I applaud the resolve to rebuild trust in the bank and the candor at admitting the many unpopular steps it will take.
My advice is to recognize that rebuilding a culture starts at the top and works its way down the organization. Establish an understanding that it is safe for people to tell you the things that are hard to say. Do not punish people when they bring up issues that are uncomfortable or difficult to address.
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In the next post, I’ll continue the discussion. I’ll talk about warning signs of low trust organizations and the advantages of high-trust cultures.
Barbara Brooks Kimmel is the CEO and cofounder of Trust Across America-Trust Around the World whose mission is to help organizations build trust. Now in its sixth year, the program’s proprietary FACTS® Framework ranks and measures the trustworthiness of over 2000 U.S. public companies on five quantitative indicators of trust. She’s also the editor of the award winning TRUST INC. book series and the executive editor of TRUST! Magazine. She can be contacted at Barbara@trustacrossamerica.com.