Elgar original reference
Edited by Reinhard Bachmann and Akbar Zaheer
Chapter 9: Public trust in the institution of business
The worst financial crisis in the past 75 years has raised vexing questions about the limits of markets, and particularly about the pathway to a prosperous future for the global economy. It has also brought to the forefront what appears to be a crisis in the public’s confidence in the institution of business. Coming out of the global financial crisis, trust in the institution of business is currently scored at a historic low (Jacobe, 2011). Business leaders called for rebuilding public trust in business and capitalism as a top priority, even before the advent of the 2008 financial crisis (BRICE, 2004). Underlying the comments of these leaders is an appreciation that public trust is essential to the smooth functioning of markets, to limiting regulation, to fostering innovation and to supporting business and business-related activities. However, the score itself provides limited information, and raises a series of questions relevant for both scholars and managers. What constitutes a ‘low’ (or a ‘high’) level of public trust? What are the costs (real or perceived) of low levels of public trust, whether to individual businesses or to society or other stakeholders? Why is public trust at the level it currently is and what, if anything, can be done about it? Public trust is a topic that is of critical importance and that deserves greater attention from scholars.
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