Report: Australian consumer trust plummets across all institutions

Latest Edelman Trust Barometer 2022 paints dire picture of consumer trust in the media, government and business and highlights how much more citizens want institutions to lead positive climate and social change

A year after Australia reported record levels of trust, the latest Edelman Trust Barometer has painted a much more dire picture of the situation in 2022, driven by growing scepticism across all forms of institutions.

The 2022 Edelman Trust Barometer found just over half of Australians trust the government to do the right up, down 9 points year-on-year. Trust in businesses wasn’t a lot better at 58 per cent, down 5 points, while not-for-profits declined 4 points also to 58 per cent.

The biggest concerns were around media. Despite reporting a notable surge in trust during 2021, levels fell 8 points to 43 per cent, making media the only institution in Australia distrusted by the majority of the population. Trust in all media sources has fallen, with traditional media only trusted by 48 per cent of Australians (-5 points), search engines by 47 per cent (-4 points), owned media by 33 per cent (-5 points) and social media by 24 per cent (-8 points). Nearly three-quarters were also worried about false information or fake news being used as a weapon (73 per cent).

All this led 55 per cent of Australians saying their default position is to distrust something first and until they see evidence of it being trustworthy. What’s more, 61 per cent agreed it had gotten to a point where Australians are incapable of having constructive and civil debates about issues they disagree on.

Across generations and all four forms of institutions, millennials appeared to be the most trusting, while Gen Z the least. And across industry sectors, only technology, education and food and beverage saw any gains in trust, up just 1 or 2 points year-on-year.

The results and overarching score of 53 on the trust index placed Australia equal second on the global scale for bigger losers of trust alongside The Netherlands and after Germany over the past year.

New data reported by Edelman for the first time this year showed Australians see government and media as more divisive than unifying for society, at 52 per cent and 55 per cent, respectively. This lies in contrast to business and NGOs, which are more likely to be seen as unifying than divisive (41 per cent and 42 per cent, respectively). The Barometer also found Australians see business as most capable of executing plans that achieve results for society (59 per cent) while governments are least capable (43 per cent).

Personalities and individual leadership impact are clearly influencing views. According to Edelman’s report, there’s been an erosion of trust in society’s traditional leaders, with only 43 per cent of local citizens trusting both government leaders and CEOs, falling 9 and 5 points year-on-year, respectively. In addition, journalists were considered the most misleading of cohorts for sharing what’s perceived as false or misleading information (65 per cent), followed by government leaders (61 per cent) and business leaders (61 per cent).

Edelman the number of Australians who expected to be better off in five years’ time (51 per cent) was static, making Australia one of nine countries experiencing all-time lows for long-term consumer optimism.

“This time last year, public trust was riding high amid optimism that Australia stood ready to bounce back from the pandemic. We asked ourselves at the time whether these levels of trust were sustainable and if Australia was experiencing a ‘trust bubble’,” Commented Edelman CEO Australia and vice chair of Asia-Pacific, Michelle Hutton. “It’s clear from this year’s results that the trust bubble has burst, and it seems the past 12 months have set Australia down an increasingly divisive path.”

But amid rising distrust of traditional leaders, Hutton cited emerging opportunity for business to play a unifying role “by embedding societal action at its operational core”.

For instance, 56 per cent of Australian consumers said they will buy or advocate for brands based on their belief and values, while 57 per cent of local employees will choose a place to work based on their beliefs and values. And 64 per cent of investors will invest based on their beliefs and values.

Overall, 44 per cent of Australians said business should be doing more when it comes to climate change, while only one in 10 per cent think business is overstepping the mark. Four in 10 Australians think business needs to take greater action on economic inequality. Even so, 74 per cent of Australian employees said they trust their employer.

This broader environment, social and governance (ESG) push is again having direct impact on how leaders are perceived. Eight in ten respondents said CEOs should be visible discussing policy with external stakeholders or work their company has done to benefit society. The report also found Australians expect CEOs to inform and shape conversations around subjects related to jobs and the economy (72 per cent), wage inequality (72 per cent), technology and automation (68 per cent), prejudice and discrimination (64 per cent) and climate change (61 per cent). However, CEOs are expected to stay out of politics, Edelman warned.

Providing ‘quality information’ was the number one most powerful trust builder in the employee’s eyes across all four types of institutions. Employers’ communications are highly trusted (70 per cent), followed by communications from government (63 per cent), media reports with named sources (58 per cent) and advertising (51 per cent).

“In the year ahead, transparency and social action will be the currency with which business will earn the trust of their people and the public,” Hutton said. “2022 must be the year of action; business has a larger-than-ever mandate to use its resources and scale to create value beyond the balance sheet. Many have declared bold ambitions in recent years, and society is now watching closely to see who will deliver. As firms work to create value for society, they have an opportunity to build trust with stakeholders along the way through operational transparency and authentic communication.”

The annual Edelman Trust Barometer is undertaken in 28 countries and across 36,000 respondents, averaging at about 1150 per country.

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