In the wake of corporate scandals and corruption, scathing public resignations and allegations of unethical behaviour, employee trust and confidence in their leaders is declining, according to a survey.
Six in 10 (61 per cent) Canadian employees don’t trust what their senior leaders say, found a survey of 1,200 workers by the Canadian Management Centre in Toronto.
“These are employees who are talking about their own organizations. This isn’t just an opinion out in the marketplace. And the fact that respondents were across 500 companies and the top 100 brands in Canada and they said they don’t trust what their leaders are saying — that was really, really shocking,” said John Wright, president and managing director of the centre.
One reason why trust is declining is the many corporate scandals making headlines, said Dan Gaynor, president of executive coaching firm Gaynor Consulting in Calgary.
“They’re reading about these examples of leadership every day in the media and so often what they see is disappointing — leaders who, when something goes wrong, rather than taking responsibility for it, look to distance themselves from that responsibility.”
Also eroding trust are internal scandals, such as instances of unethical behaviour, that the public doesn’t necessarily hear about but employees are certainly aware of, said Steven Murphy, associate dean, research and external, at the Sprott School of Business at Carleton University in Ottawa.
“Often employees are left with very little information around what happened and they’re left to fill in the gaps around, ‘Well, the person left with a golden handshake,’” he said.
“(They) don’t really know what the story is but they know there is a story and that’s the point — the story takes on a life of its own in the organization.”
Sometimes, leaders communicate just in time versus communicating the information at the right point in time, with the right level of detail and context, said Wright. This can cause employees to feel like they are only getting one-half of the story or the “spin” version, he said.
Often, leaders are not as honest with employees as they should be, and the foundation of trust is honesty, said Gaynor.
“Sometimes leaders just do this because they’re saying what’s convenient at the time or what they think might be salve for the wound in a difficult situation but, in the end, employees figure out the leader has not been speaking honestly.”
Lack of confidence is also an issue, with less than one-half (44 per cent) of Canadian employees having confidence in the senior leadership at their organization, found Build a Better Workplace: Employee Engagement Edition.
“In tough economic conditions, like it is right now, a lot of organizations are not achieving their goals. So the workers are standing back and saying, ‘Does senior management know how to get us through this period or not?’” said Wright.
Confidence in senior leadership is also eroded when employees aren’t sure what direction the organization is taking and how their jobs fit into the bigger picture, said Murphy.
“There’s a disconnect between the strategy the senior leaders are trying to enact and what people who are actually being charged with enacting that strategy are feeling. And it’s that disconnection that leads people to think there’s a competence and confidence issue.”
Leaders need to be very clear about the organization’s mission, vision and values, and make sure goals are widely understood, said Wright.
Increasing confidence in leadership can boost employee engagement, as 81 per cent of highly engaged employees have confidence in their leaders — which directly affects organizational performance, said Wright, citing a survey finding.
One way to increase trust and confidence in leadership is by focusing on transparency. In 1996, on Gaynor’s first day as publisher of the St. Catharines Standard newspaper in Ontario, he attended a meeting with company executives and learned they would be closing their press room in four months to use one in Hamilton instead. This would mean about 40 employees out of 170 would lose their jobs.
Debate broke out around the boardroom table about whether or not to inform employees right away. While the majority of executives wanted to wait, Gaynor was adamant about telling them immediately — which is exactly what he did.
“I announced why we were doing it, what our plans were and how we were going to do it and expressed sympathy for those that would be affected,” he said.
“The reason we needed to tell them was they would figure out, when we closed the presses eventually, that we had deceived them and they would never trust us again.”
Gaynor also met weekly with employees to talk about everything that was unfolding. Not only did this transparency and open communication build a foundation of trust, it also killed the rumour mill because there was less room for speculation, he said.
Only 38 per cent of employees feel senior leadership is doing a good job at communicating what is happening at work, found the survey.
Leaders should be giving regular information updates on “the good, the bad and improvement areas,” said Wright.
The messaging also has to be consistent for all the stakeholders.
“A lot of leaders will couch some of their comments to staff because they’re worried about competitive business situations. While I don’t disagree with that as a consideration, I wouldn’t make it the driver of how you communicate and how you choose to limit your communication,” said Wright.
Transparency is even more important with the younger generation coming into the workforce because they are questioning the norms more and more, said Murphy.
“That puts a different sort of filter or lens on how people view their senior managers and hold them to account in a slightly different way,” he said. “So, (they) start asking fundamental questions like, ‘Are we being told everything?’ ‘Why don’t we have that information?’”
Leaders can also boost trust and confidence by spending time with employees, being their authentic selves and showing vulnerability, said Murphy.
“People want to know that there’s some humanity in their organization — people are clamouring for that,” he said. “‘Just show us that you value who we are as human beings and we understand you’re a human being and you make mistakes and cop to it when you do.’ That whole notion of being human sometimes gets lost in the corporate chase to the next quarterly profit.”
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