counsel - honest world

FUTURE SIGNS – HONEST WORLD LOWE COUNSEL LOWE WORLDWIDE MAY 2009

Honest World: Rebuilding the Trust Deficit


We are living in a time when levels of trust in authorities and institutions are at an all time low.

ｩ 2009 The University of Chicago Booth School of Business and Kellogg School of Management

Table 1: Satisfaction with democracy, EU12 1972-2007 Source: Eurobarometer 2009


Recent events and scandals involving governments and the banking sector have shown those in authority to not only be dishonest but also criminal.

“As the latest Financial Times / Harris opinion poll shows, public respect for business leaders is all but non-existent. About three-quarters of people in Europe and the US say their opinion of business leaders has worsened because of the economic crisis.”

— How Business Became the Bogeyman, F.T. April 13 2009


All this is at odds with contemporary studies which reveal that the majority of people remain fundamentally honest.


The range and diversity of information sources now available also means it is far more difficult for people to know what to believe and who to trust.


There is an increasing need for honesty and integrity in a dishonest world.


The extent to which public trust is being eroded has huge implications for brands and corporate culture as a whole.

“It’s much easier to scare off bird’s from a tree than to bring them back again. And that’s what trust’s about. It’s much easier to destroy than to build.”

— Luigi Zinglales, professor of Finance at Chicago School of Business, Time Magazine, May 2009


Paradigm Shift in Attitudes Towards Business

GLOBALLY THERE HAS BEEN A NOTABLE SHIFT IN PEOPLE’S ATTITUDES TOWARDS THE RELATIONSHIP THAT BUSINESS HAS WITHIN SOCIETY.

WE ARE ENTERING A NEW ERA OF COLLABORATIVE CONSUMPTION, WHICH IS BRINGING PEOPLE TOGETHER WHILST CREATING GREATER SUSTAINABILITY.

PUBLIC DISGUST AT, AND DENUNCIATION OF BONUSES IN THE FINANCIAL SECTOR HAS RESULTED IN INCREASED SCRUTINY INTO BUSINESS STRUCTURE, PRACTICES AND MESSAGING.


Need for Greater Transparency

GREATER TRANSPARENCY IS REQUIRED IF CONSUMERS ARE TO OVERCOME THEIR SKEPTICISM OF CORPORATE CULTURE.

COMMUNICATIONS ARE CURRENTLY PERCEIVED AS TOO ONE-SIDED.

COMPANIES SHARE POSITIVE INFORMATION ABOUT THEIR EFFORTS, BUT OFTEN WITHHOLD THE NEGATIVE.

“If a documentary I watch is endorsed by a brand’s CSR initiative. I don’t really recall or believe a brand’s CSR activity via a TVC/Print ad/Advertorial – seems too one sided. If a brand bought print space to talk about their CSR, I immediately ignore it because it doesn’t seem credible.” Strategist, London TRANSPARENT COMMUNICATION IS AT THE CORE OF BUILDING TRUST. NOT ONLY DO CONSUMERS WANT A VOICE IN THE ISSUES, BUT THEY ARE OVERWHELMINGLY PREPARED TO LISTEN.

NEED FOR GREATER OPENNESS – ALLOW FOR TWO SIDED CONVERSATION.


THESE VALUES WILL BECOME DETERMINING FACTORS IN THE FUTURE SUCCESS OF BRANDS.

THOSE THAT ARE ABLE TO CULTIVATE A PROVEN TRACK RECORD AND REPUTATION FOR TRUSTWORTHINESS AND TRANSPARENCY WILL BUILD LOYAL COMMUNITIES.

Honesty & Integrity – Create Value


Honesty Bars

THE HOSPITALITY SECTOR HAS BEEN QUICK TO EMBRACE THE NEW APPROACH OF TRUSTING CUSTOMERS.

FROM MANILA TO BERLIN, AND EVEN RIO! HONESTY SPACES ARE SUCCESSFUL BECAUSE PEOPLE RESPOND POSITIVELY TO BEING TRUSTED AND TREATED AS ADULTS AND EQUALS.


Pay What You Want

NOT ONLY DO ‘PAY WHAT YOU WANT’ SCHEMES USUALLY RESULT IN CUSTOMERS OVER-PAYING, THEY ALSO BUILD TRUST AND GENERATE POSITIVE PUBLICITY.


Trust Certificates

REALISING THAT CONSUMERS FIND IT DIFFICULT TO CHOOSE WHICH VENDOR TO TRUST, (ESPECIALLY IN A VIRTUAL WORLD), YELLOW PAGES RECENTLY DEVELOPED ‘SUPER GUARANTEE’.

THIS, IN ESSENCE CREATES A TWO-TIER MARKET, AND INEVITABLY MEANS THE ‘GUARANTEED’ VENDORS CAN CHARGE A PREMIUM.


Consumer Contracts

INNOVATIVE AND PROGRESSIVE BRANDS ARE INTRODUCING NEW ‘CONSUMER-BRAND CONTRACTS’. THESE CREATE MUTUAL RESPECT, TRANSPARENCY AND EMPOWER CONSUMERS.


Taking Responsibility

AFTER YEARS OF IRRESPONSIBLE BUSINESS PRACTICES, PEOPLE WANT TO SEE BRANDS BEING STRAIGHTFORWARD AND TAKING RESPONSIBILITY. ESPECIALLY BANKS.


Rebuilding Trust

COMPANIES NEED TO TAKE FAST AND MEANINGFUL ACTION TO REBUILD DAMAGED REPUTATIONS AND CONSUMER CONFIDENCE.

AFTER TAKING A DAMAGING BLOW TO THEIR REPUTATION FOR QUALITY, TOYOTA EUROPE LAUNCHED A $26.5 MILLION ADVERTISING CAMPAIGN TO WIN BACK THE TRUST OF THEIR CONSUMERS.

UBS’S “WE WILL NOT REST” CAMPAIGN AIMS TO SIGNAL THE BANKS EARNEST DRIVE TO WIN BACK TRUST.

ALTHOUGH AS WITH EVERYTHING, ACTIONS SPEAK LOUDER THAN WORDS.


Raised Expectations

THE RECESSION HAS FUELLED DEMAND FOR BRANDS TO BECOME MORE HONEST AND RESPONSIBLE AND TO EMBRACE CORPORATE SOCIAL RESPONSIBILITY.

PEOPLE NOW EXPECT MAJOR MULTINATIONALS TO DO WHAT THEY, AS INDIVIDUALS, CAN’T AFFORD TO MAKE HAPPEN, AND ON A SCALE THAT THEY CAN’T ACHIEVE.

BUSINESSES NO LONGER HAVE FULL CONTROL OVER THEIR BRANDS. PEOPLE ARE QUICK TO TRANSMIT BOTH GOOD AND BAD BEHAVIOUR THROUGH SOCIAL MEDIA. BRANDS WHO AVOID THEIR RESPONSIBILITIES ARE QUICKLY VILIFIED.

“I think it is really difficult, to act sustainable in every way, these days, as we have to rethink so many aspects and processes. But I really expect from companies to act as responsible as possible.” Writer, Germany


Companies and Brands They Trust

THE COMPANIES THEY ADMIRE HAVE LONG TRACK RECORDS OF SUSTAINABLE BUSINESS PRACTICES.

- TOMS

- BEN & JERRY’S

- IKEA

- AVEDA

- BODY SHOP

- SMART CAR

TOM’S SHOES, ONE FOR ONE MOVEMENT: “WITH EVERY PAIR YOU PURCHASE TOMS WILL GIVE A PAIR OF NEW SHOES TO A CHILD IN NEED, ONE FOR ONE.” WWW.TOMS.COM


Companies and Brands They Don’t Trust

- NESTLE

- NIKE

- EXXON

- HALIBURTON

- BP

- GOLDMAN SACHS

- WALMART


The Rise of ‘Good’ Business

MORE AND MORE LEADING EDGE BUSINESS OWNERS AND ECONOMISTS ARE ADVOCATING USING BUSINESS TO HELP SOLVE BOTH GLOBAL AND LOCAL PROBLEMS. LEADING EDGE (LIBERAL) ECONOMISTS LIKE HBR’S UMAIR HAQUE ARGUE PASSIONATELY THAT THE FUTURE OF BUSINESS MUST BE A NEW MODEL OF ‘GOOD’ BUSINESS OR WHAT HE CALLS ‘CONSTRUCTIVE CAPITALISM’. BY MAKING "GOODNESS" PART OF A BRAND'S EQUITY. THEY LINK RESPONSIBLE BRAND CITIZENRY INTO WHAT THE BRAND ESSENTIALLY REPRESENTS TO CONSUMERS TO CREATE A WIN-WIN FOR BOTH COMPANIES, CONSUMERS AND THE WORLD THEY LIVE IN.

“Doing good is good business. This is not about charity or altruism. This is about doing something that is effective and efficient.” Sir Martin Sorrell, Chief executive officer of WPP Group


Honest Brands

A NEW GENERATION OF BRANDS ARE BEING CREATED WHICH HAVE HONESTY AND INTEGRITY AT THEIR HEART.

“We will never claim to be a perfect company, but we will address difficult issues and strive to be honest about our ability or inability to resolve them. We will strive to work with our suppliers to promote higher standards.”

- www.honesttea.com


SOME PROGRESSIVE BRANDS ARE CHALLENGING TRADITIONAL BUSINESS PRACTICES TO CREATE A SOFTER AND MORE HONEST WAY OF DOING BUSINESS.

SWEDISH ENERGY SUPPLIER GOD.I.E. HAS GOT RID OF TRADITIONAL SHAREHOLDERS AND INSTEAD GIVES ALL PROFITS TO A NUMBER OF CHARITIES WHICH CUSTOMERS CAN CHOOSE FROM.

Taking Responsibility


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