Building trust in the workplace: responsible, ethical, and sustainable business practices

Trustworthiness, ethical behaviour, authenticity, transparency, accountability, advocacy: in 2024, these are not simply buzzwords and buzz phrases that organisations can throw about to win over stakeholders, grow customer loyalty, and take the heat off their backs. Rather, they have become the cornerstones by which many consumers and investors choose to part with their money, playing a pivotal role in whether a business is set for long-term success and sustainability.

In a world where corporate social responsibility (CSR) and environmental, social and governance (ESG) standards ride high on the agenda – and where critical issues such as the climate crisis, poverty, health disparities, inequality, and human rights abuses loom large – businesses must proactively ‘do more’.

But building a culture of trust, both within and outside of an organisation, doesn’t happen overnight. It requires the dedicated, strategic, and sustained attention of business leaders, and an approach that delivers a positive step-change across all areas of an enterprise.

How is trust built in business?

This issue of trust – and the pressing need to nurture and prioritise it – is not lost on leaders and CEOs. According to PwC’s 24th Annual CEO Survey, 61% of UK business leaders are concerned about misinformation and 47% are concerned about a lack of trust in business.

So, in a business landscape where trust is fragile and must be continuously monitored, what are the best ways to build and maintain it?

• Honesty and transparency. Championing honesty and transparent communication signals to customers that you’re proud of your brand and have nothing to hide. Be open and honest about the brand and business, including your business model, products and services, supply chain, decision-making, business operations, conduct, employee wellbeing, ambitions, and partnerships. Do you only use sustainable manufacturing and sourcing practices? Make sure that your customers are aware. Have you made meaningful headway towards your net-zero ambitions? Shout about it.
• Value-driven actions, practices, and behaviours. Clearly outlining organisational values – and communicating them to employees, consumers, and other stakeholders – is critical in helping them to understand what your brand is, what it stands for, and why they should trust you. It also helps develop an emotional connection with your customer base. Passionate about equality and diversity? Make sure that’s reflected in your hiring practices, workforce representation, brand visuals, engagement with local communities, content production, and everywhere else.
• Active, intentional listening. The more time you spend listening, the more information you’ll glean about what your customers and employees want, need, and care about. By respecting the opinions, feedback, and experiences of others – and taking steps to make improvements where necessary – you can more easily foster trust and build long-term relationships.
• Accountability. The presence, or lack, of accountability plays a pivotal role in how your brand is perceived by others. To enhance credibility and trust, ensure that you acknowledge mistakes alongside successes, evaluate projects and use learnings to inform future practice, and foster a culture of continuous improvement and learning.
• Consistency. Building a lasting foundation of trust requires brands to be consistent and reliable – across brand identity, messaging, values, and aesthetics. Brands that lack consistency are likely to confuse consumers and damage any trust that’s already built up.

Other ways to build a solid foundation of trust in business include focusing on employee engagement, adopting a customer-centric approach, prioritising ESG and CSR initiatives, and ensuring integrity of leadership.

What is poor corporate governance – and what are its consequences?

Poor corporate governance is the unethical, inefficient, or ineffective management and oversight of business practices. It can arise from: poor leadership, a short-term mindset, weak regulatory frameworks, lack of transparency, inadequate board structures, conflicts of interest, cultural issues, poor risk management, weak internal controls, a concentration of power, lack of stakeholder engagement, economic instability and pressure, and unsustainable or poorly executed growth.

The consequences of poor corporate governance can be profound:

•       Poor financial performance
•       Corruption
•       Negligence
•       Fraud
•       Lack of accountability
•       Low morale
•       Barriers to decision-making, monitoring of outcomes, and resource allocation
•       Culture of complacency
•       Lack of innovation
•       Poor communication
•       Lack of competitive advantage.

Clearly, getting governance right is key to long-term business success. As shared by Bloomberg, a 2019 study by the Diligent Institute reported that the top fifth of corporate governance performers in the S&P 500 index outperformed the bottom fifth by 15% over a two-year period.

Avoiding corporate governance failures requires companies to be fully across all relevant statutory and regulatory requirements – from changes to risks – and practice active monitoring and management.

What are ethical business practices?

CIPD define ethical business practice as, ‘the application of ethical values to organisational behaviour.’ They state that it ‘applies in all aspects of organisational conduct, including corporate governance, employment practices, sales techniques, stakeholder relations, accounting practices, and issues of product and corporate responsibility.’ It focuses on the nature and transparency of the ethical decisions that organisations and their employees make. Get it right, and not only will you win loyal customers, but all aspects of your business will likely improve – from employee productivity to environmental responsibility to your bottom line.

Examples of ethical business practices – spanning ethical conduct, standards, and values – include treating employees with dignity and respect, creating an inclusive work environment, acknowledging responsibilities to wider society, engaging in environmental sustainability reporting, safeguarding personal and sensitive customer information, implementing anti-corruption measures, and respecting and upholding consumer rights.

Brands and businesses who are well-known for their ethical standards and practices include: shoe company TOMS, who are committed to environmental and social philanthropy and invest a third of their profits in grassroots organisations; cosmetics brand Lush, whose Ethical Charter spans factors such as business dealing with suppliers, fair employee wages, and renewable energy sources; and drink manufacturing giant PepsiCo, who invest in regenerative farming practices, 100% sustainable sourcing, and reducing environmental impact via plastic reduction.

Champion trust, accountability, and transparency in an uncertain and volatile business world

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