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Risk of 2020 recession could increase global 'breakdown in trust,' business forum told

The risk of a global recession in 2020 could exacerbate the already significant breakdown in public trust that is rattling institutions around the world, delegates at the 20th annual Global Business Forum in Banff were told Thursday.

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The risk of a global recession in 2020 could exacerbate the already significant breakdown in public trust that is rattling institutions around the world, delegates at the 20th annual Global Business Forum in Banff were told Thursday.

Lisa Kimmel, chair and chief executive of Edelman Canada, said there is a growing feeling of pessimism about the future in most parts of the developed world. According to Edelman Canada’s 2019 Trust Barometer, an online survey of 33,000 people across 27 markets, only one-in-three of the mass population believes his or her family will be better off in the next five years, and only one-in-five believes “the system is working for them.”

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Survey respondents, particularly those with less education and lower income levels, showed a significant level of distrust for institutions that were once considered the bedrocks of society. Globally, only 57 per cent of respondents said they trust NGOs, 56 per cent said they trust business, 48 per cent said they trust government, and 47 per cent said they trust media.

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If predictions of a global economic slowdown in 2020 come true, those numbers could become even more bleak.

“When an economy is strong, we typically see an increase in trust in institutions,” Kimmel said. “Now that there is starting to be talk around a potential recession, given all that is happening in the U.S. and around the world in terms of trade disputes, it will be interesting to see what happens in the coming year.”

Lisa Kimmel makes the opening keynote address “The Trust Tipping Point” during the 2019 Global Business Forum in Banff, AB at the Banff Springs Hotel on Thursday, September 26, 2019. Jim Wells/Postmedia
Lisa Kimmel makes the opening keynote address “The Trust Tipping Point” during the 2019 Global Business Forum in Banff, AB at the Banff Springs Hotel on Thursday, September 26, 2019. Jim Wells/Postmedia

The breakdown of public trust in institutions has contributed to the rise of nationalism and increasing political division at home and abroad. At the Banff Forum — an invitation-only conference that brings together prominent international business executives, academics and government leaders for conversations around world economic issues — the question of how businesses can survive or even thrive in this environment is a central theme this year.

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But Kimmel said the survey data is actually promising for businesses. Seventy-five per cent of respondents to the Edelman survey said they trusted their employer, and 76 per cent say they want CEOs to take the lead on change instead of waiting for government to impose it. Seventy-three per cent of respondents believe a company can take actions that both increase profits and improve economic and social conditions in the community where it operates.

Kimmel said it’s clear people want and expect their employers to do the right thing, for both the company bottom line and the societal common good. But in the era of social media, where brands can rise and fall in an instant, strong corporate leadership is required.

“It starts at the top. The CEO, the leader of the organization, needs to live the values of the organization,” Kimmel said. “By demonstrating that you are committed and living the values of the organization, that will help to build trust with any of your stakeholders.”

The Global Business Forum continues Friday at the Fairmont Banff Springs.

astephenson@postmedia.com

Twitter: @AmandaMsteph

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