Most Americans do not trust corporations. According to a recent Gallup poll, an astonishing 62% of Americans believe there is widespread corporate corruption. As corporate communications executives, it is important that we attempt to figure out why. Is it simply the fallout from high-profile corporate scandals all the way from Enron and WorldCom to the recent episodes at JPMorgan and Barclays? Or is it the result of something more – perhaps a fundamental lack of corporate transparency?
Undoubtedly, corporate scandals have damaged people's faith in corporate America, but this problem has been further exacerbated by the fallout from Citizens United: corporations have launched their own political action committees in order to donate large sums of shareholder money both directly to political campaigns and to super PACs.
In this election cycle alone, according to OpenSecrets.org and Yahoo Finance, AT&T's board of directors approved $6.5 million in total contributions to political candidates, parties, PACs, and other groups (so far, 65% to Republicans, 35% to Democrats); Comcast launched its own PAC: the Comcast Corporation Political Action Committee (so far, 51% to Republicans, 49% to Democrats); and Honeywell International has donated almost $2 million directly to candidates and parties (so far, 61% to Republicans, 39% to Democrats) through its PAC.
This, of course, is in addition to the large sums that corporations from banks to pharmaceutical companies, media conglomerates to manufacturers spend on lobbying each year, including contributions to politically charged organizations such as the US Chamber of Commerce, the Business Roundtable, and the American Medical Association.
Whether Americans' lack of trust in corporate America stems directly from scandal, from increasingly secretive corporate political donations, or from a combination of the two is not clear. However, what is clear is that corporate communications executives should begin considering how corporate political spending, especially when done in ways that mask any identification, contributes to this deficit of corporate trust.
History has repeatedly shown that the only way to restore trust is to open the doors, let the sunlight in, and meaningfully increase transparency. Currently, decisions to donate a corporation's funds to political campaigns, PACs, or lobbying groups are made without shareholder approval and without the engagement of the corporation's own employees. The effect of these decisions is to reduce transparency and, in turn, the trust of employees and ordinary Americans in corporations and their leaders. It is no wonder then that the 2012 Edelman Trust Barometer shows trust in businesses fell 3% globally to just 53%, while trust in CEOs plunged 12% to a paltry 38%.
With such a dramatic problem, perhaps it's time for corporate communicators to elevate the conversation of what transparency really means. What it takes to earn trust. We need to amplify this dialogue, engage CEOs in understanding the value of more daylight on these issues, and recognize that only then can trust be restored in corporate America.
Bob Feldman is cofounder and principal of PulsePoint Group, a digital and management consulting firm. He can be reached at email@example.com. His column focuses on management of the corporate communications function.