Sub-theme 02: (SWG) Trust in Crisis: Diagnoses and Remedies

Convenors:
Nicole Gillespie
UQ Business School, University of Queensland, Australia
Rosalind Searle
Coventry Business School, UK
Reinhard Bachmann
School of Management, University of Surrey, UK

Call for Papers



 

Recent global events have seriously undermined society’s trust in institutions and organizations. While trust in politicians and government had been declining for many decades (e.g. Nye et al., 1997), research indicates unprecedented low levels of trust and confidence across a variety of institutions, including business and the media (e.g. Pew Research Center, 2009). Taking the financial crisis as one prominent example, many analysts and scholars contend that it is trust, more than anything, which has been destroyed. For example, the Edelman Trust Barometer (2009) suggests that trust in corporations declined worldwide in response to the global financial crisis, with less than 50% of respondents in western developed nations trusting corporations. In particular, the public's confidence in banks, credit-rating agencies, investment agencies, insurance companies, business schools, and government regulators, has been undermined. The knock-on effects of the credit-crunch, such as widespread bankruptcies, layoffs and tightening budgets, have spread the loss of trust to multiple stakeholders: investors feel burnt, employees feel their 'psychological contracts' have been violated, and the public is cynical as governments use public funds to bail out and shore up failed banks and other corporations. A trust failure of such historical dimension raises a number of serious questions at the individual, organizational, and societal level, and provides potential for learning valuable and insightful lessons.


However, the breakdown of trust in institutions and their leaders is a pervasive global challenge that is not limited to the effects of the financial crisis. Rather, it has occurred in the context of a plethora of prominent organizational failures and trust betrayals spanning a decade or more (e.g. the UK parliamentary expenses scandal, Enron, Parmalat, AIG, Societe Generale, United Nations oil-for-food programme). Scholars, government leaders, policy makers, and social commentators have identified the need to restore public trust in institutions, organizations and their leaders for the effective functioning of society. For example, in response to the financial crisis, the leaders of the twenty economically most powerful nations (G20) declared that long-term trust in institutions needs to be reestablished by strengthening transparency, accountability and integrity, and through sound regulation and reform.


Despite the considerable volume of conceptual and empirical work on trust and trust building over the past fifteen years, organizational research has given scant attention to the restoration of trust (Dirks et al., 2009; Kramer & Lewicki, 2010). The limited research to date has relied heavily on a psychological approach and experimental methods, and has focused primarily on how individuals (e.g., a CEO) regain the trust of others. Yet, recent research suggests that the processes and mechanisms of trust repair are fundamentally different at the organizational vs. interpersonal level (cf. Gillespie & Dietz, 2009). However, there is currently limited research conceptualising trust at the institutional and organizational levels [for foundational work see Shapiro (1987) and Zucker (1986)], and little understanding of how macro and micro level forces influence trust dynamics at the institutional level. Given the recent financial crisis and associated failures, a redirection of attention to focus on trust in organizations and institutions is warranted.


The aim of this sub-theme/standing working group is to focus attention squarely on organizational- and institutional-level trust failures and repair. We invite contributions that help to clarify theoretically and/or empirically the antecedents, processes and consequences of organizational and institutional trust, and its destruction and repair, as well as the dynamic interplay between interpersonal, group, organizational, institutional, and societal trust. We actively encourage a cross-disciplinary dialogue and submissions that adopt novel as well as traditional methodologies, including case-studies, surveys, ethnographies, experiments, mixed, grounded, and critical approaches. Papers are expected to have a clear ambition towards first-rate publication, and authors of accepted papers will be encouraged to submit to the forthcoming Special Issue of Organizational Studies on 'Trust in Crisis: Organizational and Institutional Trust, Failures and Repair' (Deadline: December 3, 2012).


Some of the challenging questions that this sub-theme/standing working group aims to address include:

  1. What strategies and approaches are most effective for restoring organisational trust? Under what circumstances and in what contexts do these approaches result in enduring outcomes? Can trust in organizations be maintained in the face of large-scale change and layoffs?
  2. To what extent do the expectations and processes of trust repair vary in response to different stakeholder groups (e.g. employees, customers, investors, suppliers, legislators etc.)? How can organizations deal with incompatible expectations from various stakeholders?
  3. Do the mechanisms of restoring trust differ depending on the nature of the focal entity, that is, whether it is a government, a public agency, a for-profit, or a not-for-profit organization that is attempting reputation repair?
  4. What insights into the antecedents and facilitators of trust failures can be gained from an analysis of prominent institutional failures, such as the global financial crisis? What structurally-embedded pressures (e.g. short-term gains) and lack of countervailing constraints (e.g. regulatory controls, accountability and transparency) contribute to such failures?
  5. To what extent are trust failures and repair efforts influenced by the broader legal, political, regulatory and cultural environment?
  6. Under what conditions can new regulations create, restore, or substitute for trust in institutions? How do these controls affect individual, organizational and societal trust?
  7. Is it possible or appropriate to repair trust in organizations that have repeatedly violated their stakeholders' trust? When is 'distrust' an asset? What is the functionality of low trust levels toward institutions and organizations? Under what circumstances, is distrust a problem?
  8. What do the social sciences tell us about the possible barriers to trust repair efforts? For example, what are some of the important psychological, organizational, and social impediments to effective trust restoration? Relatedly, to what extent do existing micro- and macro- level organizational theories help us understand why trust repair might be difficult to enact and sustain in complex organizational settings?

For more background information, please see: www.organisationaltrust.org/

 


References

 

Dirks, K.T., R.J. Lewicki & A. Zaheer (2009): "Repairing relationships within and between organizations: Building a conceptual foundation." Academy of Management Review, 34 (1), 68–84

Edelman Trustbarometer (2009): The tenth global opinion leaders study. Available electronically from http://www.edelman.com/trust/2009/

Gillespie, N., & G. Dietz (2009): "Trust repair after an organizational-level failure." Academy of Management Review, 34 (1), 127–145
Kramer, R.M., & R.J. Lewicki (2010): "Repairing and enhancing trust: Approaches to reducing organizational trust deficits." In: J.P. Walsh & A.P. Brief (eds.), The Academy of Management Annals, Vol. 4, 245–277
Nye, J.S., P.D. Zelikow & D.C. King (1997): Why People Don't Trust Government. Boston: Harvard Publishing Press
Pew Research Center (2009): Trust Around the Globe. Washington, D.C.: Pew Publications
Shapiro, D. (1987): "The Social Control of Impersonal Trust." American Journal of Sociology, 93, 623–658
Zucker, L.G. (1986): "Production of trust: Institutional sources of economic structure, 1840–1920." In: B.M. Staw & L.L. Cummings (eds.), Research in Organizational Behavior. Greenwich, CT: JAI, 53–111

 

Nicole Gillespie Nicole Gillespie is Senior Lecturer in Management at UQ Business School, University of Queensland. Her research focuses on organisational trust, trust repair, and trust measurement and appears in leading journals (e.g. Academy of Management Review, Journal of Management) and books (e.g. co-editor of Organizational Trust: A cultural perspective, Cambridge University Press). She is co-guest editor of the special issue of Organization Studies on ‘Trust in Crisis’ and on the editorial board of Journal of Trust Research.
Rosalind Searle 
Reinhard Bachmann Reinhard Bachmann’s is Chair in Strategy (University of Surrey). His research focuses on trust and power in inter-organizational relations (publications in Organization Studies, Cambridge Journal of Economics, British Journal of Sociology, co-editor of the Handbook of Trust Research). He is on the editorial board of Journal of Trust Research and Organization Studies.