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2013 Emerging Markets Supplement: Edelman Trust Barometer
 

2013 Emerging Markets Supplement: Edelman Trust Barometer

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There is a 33-point gap between global trust in multinational companies based in developed markets (76 percent) and those in emerging markets (43 percent). The inaugural 2013 Emerging Markets ...

There is a 33-point gap between global trust in multinational companies based in developed markets (76 percent) and those in emerging markets (43 percent). The inaugural 2013 Emerging Markets Supplement to the Edelman Trust Barometer explores the unique trust challenges facing companies headquartered in emerging markets, with particular focus on those based in BRIC countries.

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2013 Emerging Markets Supplement: Edelman Trust Barometer 2013 Emerging Markets Supplement: Edelman Trust Barometer Presentation Transcript

  • 2013 TRUST BAROMETER: EMERGING MARKETS SUPPLEMENT 2 GLOBAL ONLINE SURVEY IN NINE COUNTRIES • 5,400 respondents • Nine countries: • Developed: U.S., U.K., Germany, France • Emerging: China, India, Indonesia, Mexico, South Africa INFORMED PUBLICS • 600 respondents in each country • Ages 25-64 • College-educated • In top 25% of household income per age group in each country • Report significant media consumption and engagement in business news and public policy • 13 years of data
  • Indonesia 74 Mexico 82 China 74 India 81 US 62 UK 56 Germany 48 France 44 DISTRUSTERSTRUSTERSNEUTRALTRUST IN BUSINESS IN MAJORITY OF EMERGING MARKETS TRENDING UPWARD 3 Indonesia 77 Mexico 74 China 79 India 81 US 64 UK 56 Germany 52 France 55 South Africa 69 +3 -8 +5 No Change +2 No Change +4 +11 New 2013 Field date: Q4 2012 2013 Emerging Markets Supplement Field date: Q3 2013 8 MARKETAVERAGE: 56 8 MARKETAVERAGE: 65 9 MARKETAVERAGE: 67 2012 Field date: Q4 2011 Indonesia 78 Mexico 77 China 71 India 69 US 50 UK 38 Germany 34 France 28 HOW MUCH DO YOU TRUST BUSINESS IN GENERAL TO DO WHAT IS RIGHT Q7. [Business in General] Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64
  • 2013 33 point gap between developed and emerging market trust Brazil China France Germany India Russia UK USA 20% 30% 40% 50% 60% 70% 80% 90% 2009 2010 2011 2012 2013 EMERGING MARKET HEADQUARTERED COMPANIES HAVE DECLINING TRUST SINCE 2011 GLOBAL TRUST IN MULTINATIONAL COMPANIES (MNCs) HEADQUARTERED IN EACH COUNTRY DEVELOPED MARKET AVERAGE EMERGING MARKET AVERAGE Now we would like to focus on global companies headquartered in specific countries. Please indicate how much you trust global companies headquartered in the following countries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64 in 20-country global total # 2012 data is not available – a simple average has been used to show a trend
  • The 2013 Emerging Markets Supplement to the Edelman Trust Barometer explores the following factors that may affect developed markets’ trust in emerging market-based businesses, based on our hypotheses: • Low brand familiarity: Respondents in developed markets are not familiar with emerging market-based multinational corporations (MNCs). • Sensitivity about the state: Developed markets perceive emerging market-based businesses to have close ties with their national governments, whom they do not trust. • Tangible actions dominate: Perceived poor performance against concrete trust-building actions (e.g., supply chain management, IP protection, etc.) erodes trust.
  • THE STATE OF TRUST IN EMERGING MARKETS
  • TRUST IN INSTITUTIONS: NGOs REIGN IN DEVELOPED MARKETS WHILE EMERGING MARKET TRUST LANDSCAPE MORE DIVERSE EMERGING VS. DEVELOPED MARKET NATIONAL TRUST IN INSTITUTIONS 7 EMERGING MARKETS DEVELOPED MARKETS 50% 56% 80% 57% 39% 25% 48% 49% 39% 44% 77% 86% 81% 66% 51% 50% 50% 47% 51% 81% 79% 77% 74% 69% 64% 56% 55% 52% 73% 87% 59% 81% 66% 69% 63% 68% 61% India China Indonesia Mexico S. Africa U.S. UK France Germany BUSINESS NGOSMEDIA GOVERNMENT Q7. [Business in General, Government in General, Media in General, NGOs] Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust)
  • 67% 81% 79% 77% 74% 69% 64% 56% 55% 52% 49% 56% 80% 57% 39% 25% 48% 49% 39% 44% Total India China Indonesia Mexico South Africa US UK France Germany BUSINESS HAS A TRUST ADVANTAGE OVER GOVERNMENT, EXCEPT IN CHINA TRUST IN BUSINESS VS. GOVERNMENT 8 EMERGING MARKETS DEVELOPED MARKETS 50% BUSINESS GOVERNMENT Q7. [Business in General and Government in General] Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a 9- point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64
  • 50% 80% 78% 72% 72% 47% 45% 44% 43% 42% 40% 39% Germany UK US France Brazil South Africa Russia India China Mexico Indonesia 9 DEVELOPED MARKET-BASED MNCs HAVE 33-POINT TRUST LEAD OVER MNCs HEADQUARTERED IN EMERGING MARKETS MOST TRUSTED NATIONAL IDENTITY FOR COMPANIES Developed Markets 76% Emerging Markets 43% Q8. [TRACKING] Now we would like to focus on global companies headquartered in specific countries. Please indicate how much you trust global companies headquartered in the following countries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64 in 9-country global total
  • 22% 46% 71% 23% 50% 64% 31% 55% 61% 24% 50% 83% 28% 48% 83% 50% TRUST GAP: EMERGING MARKETS TRUST THEIR LOCALLY-BASED MNCs SIGNIFICANTLY MORE THAN THE REST OF THE WORLD TRUSTS THOSE COMPANIES TRUST RELATED TO COMPANIES’ NATIONAL IDENTITY 10 Indonesia-Based MNCs South Africa-Based MNCs India-Based MNCsChina-Based MNCs Mexico-Based MNCs EMERGING TRUST IN COUNTRY-BASED MNCs NATIONAL TRUST IN LOCALLY-BASED MNCs DEVELOPED TRUST IN COUNTRY-BASED MNCs Q8. [TRACKING] Now we would like to focus on global companies headquartered in specific countries. Please indicate how much you trust global companies headquartered in the following countries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64
  • 11 CHINA- AND RUSSIA-BASED MNCs FACE LARGEST TRUST HURDLE IN DEVELOPED MARKETS GERMANY MOST DISTRUSTFUL OF ALL BRIC HEADQUARTERED COMPANIES TRUST RELATED TO COMPANIES’ NATIONAL IDENTITY *January 2013 data 50%50% China’s Trust in Chinese MNCs83% Russia’s Trust in Russian MNCs*40%37% 19% 29% 26% 22% 50% 33% 61% 53% Total Germany UK US France India South Africa Indonesia Mexico Q8. [TRACKING] Now we would like to focus on global companies headquartered in specific countries. Please indicate how much you trust global companies headquartered in the following countries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64 44% 16% 25% 27% 24% 66% 83% 32% 65% 60% Total Germany UK US France India China South Africa Indonesia Mexico
  • 12 INDIA AND BRAZIL-BASED BUSINESSES ENJOY SLIGHT TRUST ADVANTAGE IN THE WEST SOUTH AFRICA A SURPRISING CHALLENGE FOR ALL BRIC-BASED MNCs TRUST RELATED TO COMPANIES’ NATIONAL IDENTITY *January 2013 data 50%50% Brazil’s Trust in Brazil MNCs*60% India’s Trust in India MNCs83% 47% 23% 32% 38% 38% 60% 76% 38% 55% 66% Total Germany UK US France India China South Africa Indonesia Mexico 38% 21% 30% 35% 28% 61% 32% 50% 50% Total Germany UK US France China South Africa Indonesia Mexico Q8. [TRACKING] Now we would like to focus on global companies headquartered in specific countries. Please indicate how much you trust global companies headquartered in the following countries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64
  • TRUST ISSUES ACROSS INDUSTRIES FOR BRIC COMPANIES IN DEVELOPED MARKETS 13 HOW MUCH DO YOU TRUST BRIC MARKET-BASED COMPANIES IN THESE INDUSTRIES TO DO WHAT IS RIGHT? 13 EMERGING MARKETSDEVELOPED MARKETS 67% 68% 69% 71% 71% 72% 76% 77% 79% 84% 39% 31% 34% 44% 34% 40% 43% 47% 49% 54% Food & Beverage Pharmaceuticals Media Consumer Packaged Goods Financial Services Aerospace & Defense Energy Automotive Telecommunications Technology Q11. [TRACKING] Please indicate how much you trust businesses in BRIC markets such as Brazil, Russia, India and China in each of the following industries to do what is right. Use the same 9-point scale where one means that you “do not trust them at all” and nine means that you “trust them a great deal”. (Top 4 Box, Trust) Informed Publics Ages 25-64
  • APPROXIMATELY TWO-THIRDS OF DEVELOPED MARKET RESPONDENTS REJECT DOMESTIC INVESTMENT FROM COMPANIES BASED IN ANY GIVEN BRIC MARKET 14 62% 60% 60% 63% 30% 40% 38% 34% Russia Brazil India China BUY A COMPANY IN YOUR COUNTRY 63% 63% 62% 63% 33% 43% 41% 36% Russia Brazil India China BUY A MINORITY SHARE IN A COMPANY IN YOUR COUNTRY 63% 63% 63% 65% 34% 43% 40% 38% Russia Brazil India China MAKE A MAJOR INVESTMENT IN A NEW PLANT OR OFFICE IN YOUR COUNTRY Q9. Please continue to think about global companies headquartered in specific emerging markets. How much would you trust a company from [INSERT BRIC COUNTRY] to do what is right in the following investment situations? (Top 4 Box, Trust) Informed Publics Ages 25-64 HOW MUCH DO YOU TRUST A COMPANY BASED IN [BRIC] TO … EMERGING MARKETSDEVELOPED MARKETS
  • LOW BRAND FAMILIARITY
  • 16 PROMPTED AWARENESS OF BRIC MARKET BRANDS BY MARKET BRIC-BASED MNCs HAVE TO RAISE OVERSEAS AWARENESS; CONSUMER-FACING BRANDS MAKING PROGRESS 50% 26% 9% 38% 11% Petrobras Vale 72% 63% 54% 45% 70% 68% 63% 26% 89% 79% 87% 81% Lenovo Air China Bank of China Haier 25% 36% 54% 23% 99% 98% Tata Infosys 20% 30% 65% 23% Gazprom Lukoil 50% US EUROPE OWN MARKET Q15. Below is a list of companies. Which are you aware of? SELECT ANY THAT APPLY. Informed Publics Ages 25-64 in US, Europe (France, Germany, UK) and own market
  • 14% 12% 10% 10% 5% 4% 3% 2% 0% 20% 40% 60% 80% India* Russia China* Brazil BRIC COMPANY CEOs HAVE LOW VISIBILITY GLOBALLY, ESPECIALLY IN DEVELOPED MARKETS 17 UNPROMPTED AWARENESS OF BRIC MARKET COMPANY CEOs or CHAIRPERSONS BY MARKET Top CEOs† Emerging Developed Emerging Developed Emerging Developed Emerging Developed 1 Ratan Tata Tata Ratan Tata Tata Alexey Miller Gazprom Alexey Miller Gazprom Yang Yuanqing Lenovo Yang Yuanqing Lenovo Maria das Graças Silva Foster Petrobras Maria das Graças Silva Foster Petrobras 2 Naveen Jindal Jindal Steel Power Limited N. R. Narayana Murthy Infosys Oleg Deripaska Basic Element Company Andrey Kostin VTB Bank Robin Li Baidu Hong Qi Minsheng Banking Corp Murilo Pinto de Oliveira Ferreira Vale Eike Batista EBX Group 3 Mukesh Ambani Reliance Industries Mukesh Ambani Reliance Industries Andrey Kostin VTB Bank Oleg Deripaska Basic Element Company Ren Zhengfei Huawei Fu Chengyu Sinopec Ricardo Semler Semco SA Murilo Pinto de Oliveira Ferreira Vale *India: Emerging market data does not include Indian data; China: Emerging market data does not include Chinese data †The top first-mentioned three CEOs by market 68% of Chinese can name a Chinese HQ CEO 77% of Indians can name an Indian HQ CEO Level of unprompted CEO awareness in their own country EMERGING MARKETSDEVELOPED MARKETS Q16. When you think of CEOS/Chairmen of companies from the following markets, which individuals first come to mind? [INSERT MARKET: CHINA, BRAZIL, INDIA, RUSSIA] (Respondents answering with at least one current CEO/Chairman of a company headquartered in China/Brazil/India/Russia. Informed Publics Ages 25-64
  • SENSITIVITY ABOUT THE STATE
  • 50% CHINA, RUSSIA-BASED COMPANIES SEEN AS HAVING “TOO MUCH” STATE CONTROL 19 % AGREE WITH STATEMENT: “THERE IS TOO MUCH GOVERNMENT CONTROL OF COMPANIES FROM [BRIC]” (TOP 2 BOX) 70% 64% 51% 47% 42% 23% 65% 58% 36% 43% 38% 21% 25% 60% 44% 25% 26% 16% 24% 41% 37% 24% 21% 15% Germany India China UK US France CHINA INDIA RUSSIA BRAZIL Q13. Please indicate how much you agree or disagree with the following statement: “There is too much government control of companies from [INSERT MARKET: BRAZIL, INDIA, RUSSIA, CHINA]. (Top 2 Box – Strongly/Somewhat agree) Informed Publics Ages 25-64
  • DEVELOPED MARKETS DISTRUST ALL FORMS OF EMERGING MARKET-BASED BUSINESSES, BUT STATE-OWNED BUSINESSES MOST DISTRUSTED 20 TRUST BY BUSINESS OWNERSHIP 20 77% 73% 71% 67% 50% 50% 45% 37% Publicly Listed Entrepreneur Privately Owned State Owned EMERGING MARKETSDEVELOPED MARKETS Q10. When you think about the following types of organizations in BRIC markets such as Brazil, Russia, India and China, how much do you trust each type of organization to do what is right? (Top 4 Box, Trust) Informed Publics Ages 25-64
  • TANGIBLE ACTIONS DOMINATE
  • 59% 48% 50% 48% 58% 51% 50% 47% 48% 54% 52% 50% 49% 49% 58% 48% 65% 68% 68% 70% 72% 74% 75% 76% 77% 78% 80% 80% 81% 81% 82% 82% CONSISTENT FINANCIAL RETURNS TOP GLOBAL COMPANY ADMIRED TOP LEADERSHIP PARTNERS W/ 3RD PARTIES INNOVATOR POSITIVELY IMPACTS COMMUNITY ADDRESSES SOCIETY'S NEEDS PROTECTS ENVIRONMENT CUSTOMERS BEFORE PROFITS LISTENS TO CUSTOMERS LOOKS AFTER EMPLOYEES COMMUNICATES OFTEN ACTS RESPONSIBLY IN CRISIS IS ETHICAL HIGH QUALITY PRODUCTS TRANSPARENT & OPEN Importance Performance DEVELOPED MARKETS PERCEIVE A LARGE GAP IN EXPECTATIONS VS. PERFORMANCE ON KEY TRUST BUILDING ATTRIBUTES FOR BRIC-BASED MNCS STATED IMPORTANCE VS. COMPANY PERFORMANCE (TOP 4 BOX) – DEVELOPED MARKETS -34 -24 -32 -32 -30 -28 -24 -29 -29 -25 -23 -14 -22 -18 -20 -6 Gap Q16. How important is each of the following actions to building your TRUST in companies headquartered in [INSERT BRIC]? Use a nine-point scale where one means that action is “not at all important to building your trust” and nine means it is “extremely important to building your trust” in a company. (Please select one response for each.) Q. 18 Please rate companies headquartered in [INSERT BRIC] on how well you think they are performing on each of the following attributes. Use a nine-point scale where one means they are “performing extremely poorly” and nine means they are “performing extremely well”. (Top 4 Box, Trust) Informed Publics, ages 25-64 (excluding “don’t know”) 22 INTEGRITYENGAGEMENT PURPOSEPRODUCTS & SERVICES OPERATIONS
  • 23 Importance Performance MORE EFFECTIVE EXECUTION AGAINST TANGIBLE ACTIONS BY BRIC BASED-MNCs WILL HELP ESTABLISH HIGHER LEVELS OF TRUST WITHIN DEVELOPED MARKETS TOP 10 BEHAVIORS TO BUILD TRUST IN BRIC HEADQUARTERED COMPANIES – DEVELOPED MARKET VIEW RANKED BY IMPORTANCE TOP 10 BEHAVIORS TO BUILD DEVELOPED MARKET TRUST IN BRIC-BASED MNCS GAP IMPORTANCE VS. PERFORMANCE 1. Quality control -31 2. Protects customer data -32 3. Respects employee rights -35 4. Protects intellectual property -31 5. Responsible supply chain management -33 6. Pays appropriate taxes -28 7. Uses R&D -23 8. Independence from State -26 9. Makes CSR progress -27 10. Employs diverse workforce -22 Q17. How important are each of the following factors to building your TRUST in companies headquartered in [INSERT BRIC]? Use a nine-point scale where one means that action is “not at all important to building your trust” and nine means it is “extremely important to building your trust” in a company. (Please select one response for each.) (Top 4 Box, Trust) Informed Publics Ages 25-64
  • THE PATH FORWARD FOR BRIC-BASED MNCs
  • 50% CHINA INDIA RUSSIA BRAZIL 59% 56% 72% 68% 44% 76% 75% 83% 80% 67% 71% 71% 80% 77% 63%62% 60% 76% 72% 45% A Global CEO of a company headquartered in this BRIC market A company executive from this BRIC market-based MNC who is based in your country An academic or expert from this BRIC market A regular employee of this BRIC- based MNC A government leader (senior official) from this BRIC market 25 EXPERTS AND EMPLOYEES ARE MOST CREDIBLE SPOKESPEOPLE FOR BRIC-BASED MNCs WHEN COMMUNICATING IN DEVELOPED MARKETS CREDIBILITY OF SPOKESPEOPLE FOR BRIC-BASED MNCs IN DEVELOPED MARKETS Q22. [TRACKING] Below is a list of people. In general, when forming an opinion of a company, if you heard information about a company from each person, how credible would the information be--extremely credible, very credible, somewhat credible, or not credible at all? (Top 2 Box, Very/ Extremely Credible) Informed Publics Ages 25-64
  • EARNED MEDIA MOST TRUSTED SOURCE FOR NEWS ON BRIC-BASED COMPANIES IN DEVELOPED MARKETS EMERGING VS. DEVELOPED MARKET TRUST IN MEDIA FOR BRIC-BASED COMPANY NEWS 26 50% 36% 28% 26% 64% 58% 57% EARNED MEDIA ADVERTISING OWNED MEDIA Q21. How much do you trust each of the following media sources when you see or hear news, information or stories about a company headquartered in [MARKET]? Please use a 9-point scale where one means that you "do not trust it at all" and nine means that you "trust it a great deal“(Top 4 Box, Trust) Informed Publics Ages 25-64
  • RECOMMENDATIONS FOR PROMOTING BRIC HEADQUARTERED COMPANIES OVERSEAS 27 • BUILD YOUR BRAND • BE MORE PROACTIVE AND TRANSPARENT • FOCUS ON ETHICAL BEHAVIORS • USE EXPERTS AND EMPLOYEES AS SPOKESPERSONS, NOT CEO