Blog: Stop Press - trust in business on the rise
Directors' Blog: Philippa Foster Back CBE

Although this is the season to be merry, opening a newspaper or your newsfeed, you would be forgiven for feeling pretty gloomy – 

constitutional crisis in the UK, riots in Paris and Sir David Attenborough’s warning that time is running out unless we do something about climate change, to name a few.

But at the Institute of Business Ethics, we have some cautious good news. Public trust in British business is at its highest level in 15 years.

The IBE has asked the public their opinion of British business behaviour annually since 2003 . We saw a positive improvement in 2017, but this year the rise has been dramatic. 

62% think that British business behaves ethically – that’s a jump of 15 percentage points from last year.

Millennials especially are showing the most positive change in opinion. Only a quarter of the younger generation of 18-24 year olds think British business behaves unethically, compared with over a third last year.

As global political uncertainty overshadows much of the news, business in contrast seems to offer stability and appears more responsible in the eyes of the public. 

Businesses are also more accessible to their stakeholders. Their sensitivity to the reputational impact of social media means that the public can see that they are able to have an effect on business decision-making, where they may feel powerless to influence governments.

This willingness to be open is having a positive impact on public opinion, but it has been a slow process. We are ten years after the financial crisis, which brought us this trust crisis. Has business done enough to regain public trust?

We’re not out of the woods yet, there is still much that the public thinks business needs to focus on. We continue to see tax avoidance and executive pay as the top issues the public think business needs to address. These two issues highlight the public’s concern with business ethics and issues of fairness in our society. No matter that these are complex issues, it doesn’t seem fair in times of austerity, to read stories of chief executives with salaries too complicated to measure; or that HMRC are clamping down on low-income tax avoiders, while big business continues to exploit loop-holes in the interest of ‘tax efficiency’.

The Investment Association’s principles of remuneration, which outline what investors expect on this issue, may help to push pay in a more sensible direction. More companies are embracing the Fair Tax Mark which certifies those who pay corporation tax in a fair and timely fashion. But although the levels of concern are falling, it still seems that business is not doing enough to rectify these perceptions. 

A third issue has risen to prominence this year, which is that the public want to see business take environmental responsibility seriously. A quarter now think that environmental responsibility most needs to be addressed (up from 15% last year). 

The hit TV show ‘The Blue Planet’ may have something to do with it. Its portrayal of plastic in our oceans has caught the public’s imagination, for an issue which had fallen in their consciousness over the past ten years. Its rise in prominence perhaps reflects that it is not just Millennials who are sensitive to this issue.

The public are looking to the business community to lead on this, where it sees that governments are too conflicted or just slow to move and make an impact. 

Is business ready to take up this challenge?

Posted: 18/12/2018

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