Family Business Trust Research Unveiled at the NYC Family Forum

The most fascinating session at the FBN Family Forum was “Family Business Trust: Driving Longevity through the Family Trust Advantage”.  Richard Edelman and Justin Blake of Edelman, a family owned business, shared their results and insights from the 2017 Edelman Trust Barometer.  This tool measures public opinions and perceptions of trust among different institutions and different aspects of business.  This year, there was a special focus on family businesses.  Does the public trust family businesses more than corporate institutions?  Are people willing to pay more for products produced by a family business?

Here are the major findings and insights:

  • The mass class divide continues to widen.
  • Public trust is declining in all 4 institutions – NGO’s, business, media and government
  • People would rather work for a family business than a different institution.
  • If customers know you are a family business they will pay more for your product.  Does the general public know that you are a family business?
  • Family businesses aren’t getting credit for job creation.  Fewer than 1 in 3 people perceive family businesses as job creators and the reality is that family businesses create 50-80% of jobs.
  • Non-family businesses are seen as more innovative, long term thinking and have greater financial success.  All of this is not true.  Family businesses are innovative, take the long-term view and have substantial financial success.
  • The general public perceives family businesses as behind in societal contributions and giving back.
  • 78% surveyed agreed that wealthy individuals often create non-profit foundations for the wrong reasons – exert political influence, vanity and self-promotion to ease their guilt.
  • The public trusts a founder more than the next generation leadership.  They will trust the next generation leaders more if they have experience in the business, are appointed on merit, if they are committed to the further and if they are innovative and transparent about their plans for the business.

Richard Edelman’s Recommendation for Family Businesses

TELL YOUR STORY! Tell your friends, your customers, your employees about your history, the founding story, the family’s role in the business.  Tell them about your foundation and how you help the communities.  Tell them your business employees 10,000 people and the business helps them put food on the table.  They can buy birthday gifts for their kids because of the company.  Consider a more public presence for family members who are involved in the business and most of all tell people about your supply chain.

Use multiple voices to tell your story - the founder, CEO, the board, academic experts, a person like yourself.  Don’t forget your employees – they are your company ambassadors!

 Click here to view the presentation.  Please leave comments, questions and thoughts below! We would love to hear from you on this topic and get your reaction!

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