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IN HONOR OF A TRUSTWORTHY MOTHER

Patricia Duffy Hurley

August 17, 1924 to October 16, 201232,233 days of a life that inspired trust.

CFTO VISION

To expand the number of organizations that can legitimately be called trustworthy because they consistently demonstrate the values, practices and processes that warrant stakeholder trust.

CFTO ACTIVITIES

Annual Summit

Speaker Series

Best Practice Groups

Cutting-Edge Research

Trust Measurement Diagnostics and Metrics

Executive Education

Confident reliance on a person, group, or organization when there is uncertainty and risk

What Is Trust?

THE PROBLEMConfidence in Business – Harris Poll

" Is insider trading part of the fabric?"

"Jury Says Vivendi Defrauded Liberty Media"

"Financier Is Sentenced To 110 Years For Fraud"

"Fraud accusations threaten Burgundy's reputation "

NEW YORK TIMES HEADLINES THIS SUMMER

"A Calculated Deal In a Rate-Rigging Inquiry "

"Regulators Charge a Futures BrokerageFirm and Its Chief with Fraud"

"Olympus Says It Might Have Violated an Anti-Bribery Law "

Copyright 2012 Dr. Hurley

PORTRAYING A CULTURE OF DISTRUST IN BUSINESS

PORTRAYING A CULTURE OF DISTRUST IN BUSINESS

WE’VE FALLEN A LONG WAY

THE MANAGEMENT OF TRUST

People, companies and systems emit trust and distrust signals

TRUST SCORES RISE AND FALLConfidence changes

A FIVE PART SOLUTION

• Better regulation to reduce signals of distrust• Change the conversation from ethics to trust• Educate trustors to make better trust decisions• Develop more trustworthy leaders• Trustworthy leaders embed trustworthiness into the

DNA of their organizations

ETHICS AND TRUST

• How many of you think about the degree to which you have ethical and unethical relationships in your life?

• How many of you think about the degree to which you have high or low trust relationship son your life?

• Ethics – First principles• Integrity and honesty• Fairness• Benevolence and concern for others• Virtue and moral precepts

• Is it possible to be ethical and untrustworthy?

Regulating Distrust

Effective regulation can create standards that mitigate risk and distrust.

Low HighRisk Tolerance

SituationalFactors

TrustorFactorsLow High

Low HighPower

Adjustment

Low HighSituational Security

Not Apparent Apparent

Conflicting AlignedInterests

Similarities

Not Demonstrated DemonstratedBenevolent Concern

Low High

Low HighPredictability/Integrity

Capability

Poor GoodCommunication

DistrustingChoice

TrustingChoice

The Decision To Trust Model

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

A MODEL OF THE TRUST/DISTRUST CHOICE

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Distrusting Choice Trusting Choice

Not apparent

Conflicting

Not demonstrated

Low

Low

Poor

Apparent

Aligned

Demonstrated

High

High

Good

THE SCIE

NCE OF E

MBEDDING

TRUSTWORTHIN

ESS IN

ORGANIZATIO

NS

QUOTETRUSTWORTHINESS

FAILUREWHERE

IN ORGANIZATION

“Overwhelming volume” CapabilityCompetencies

StructureCore Processes

“Lost culture of accuracy”

“Focus on market share”

“Removed analysts”

“Waved procedures”

Benevolent Concern

Communication

Alignment of interests

Integrity

Leadership

Mission/strategyCommunication Systems

HR Systems

Core Processes

“IBG-YBG”

Similarities Culture

ORGANIZATION

Similarities

Interests

Benevolent Concern

Capability

Predictability/Integrity

Communication

Stakeholders’Decision to Trust

ORGANIZATIONAL PERFORMANCE AND TRUST MODEL

Th

e De

cision to T

RU

ST: H

ow LE

AD

ER

S C

reate

High

-Trust O

rgan

izatio

ns, Ro

bert F. H

urle

y,C

opyrigh

t © 2

012 by R

obert F. H

urley. All righ

ts rese

rved.

Copyright 2012 Dr. Hurley

Leadership

Systems (Planning,Reporting, Budgeting,Compliance, Reward)

Selection andManagement of People

Other(Natural

Environment, Investors,

Government, Technology,

etc.

Values and Competencies

Cooperativeness of Relationship

1 6

2

3

5

4

7

1. Trustworthy Leaders: What’s Required for the Next Generation2. Effective Trust Repair3. Measuring Organizational Trust and Trustworthiness4. HR and L&D in Trustworthy Organizations

5. The Regulation of Distrust and Building High Trust Firms6. Moving from Compliance to Deep Embedding of Ethical Cultures7. A Multi-stakeholder Communications Approach to Building Trust