The Reasons Why High-Trust Organizations Outperform

For many chief executives, the challenge is familiar: your strategy is sound, your market position is strong, yet execution falls short of expectations. Despite investing in engagement initiatives, turnover remains high and productivity lags. Stakeholders demand increasingly sophisticated reporting on intangible metrics, while your measurement systems struggle to capture the full picture of organizational health.

At the root of these challenges often lies a single, critical factor: trust. While trust is arguably your most valuable organizational asset, it remains one of the most challenging to build, measure, and maintain.

Let’s explore how high-trust organizations outperform their competitors, how leaders can measure trust amongst their key stakeholder groups, and the 3 pillars of building trust to enhance organizational performance and resilience.

The business case for trust: 6 ways high-trust organizations win

Did you know? Companies with high trust levels outperform their competitors by up to 400%.

The dictionary definition of trust is “reliance on the integrity, strength, ability, surety, etc., of a person or thing; confidence”. Organizational trust manifests in observable, measurable patterns that directly impact business performance. A high-trust organization isn’t just a pleasant place to work – it’s a more efficient, innovative, and profitable entity.

Here are the top 6 reasons how possessing high levels of organizational trust can boost your organization’s performance and longevity.

1. Improved operational performance

Research shows that organizations ranking in the top quartile for trust see 50% higher productivity compared to their low-trust counterparts. This productivity boost stems from tangible behavioral changes: employees take initiative without waiting for detailed instructions, share information freely rather than hoarding it for political advantage, and focus on solving problems rather than documenting their efforts to avoid blame.

2. Improved employee loyalty and retention

When people trust their organization, they stay longer and perform better. In the same study, high-trust organizations reported 76% higher employee engagement levels, translating to improved customer service, higher quality output, and increased innovation. Employees also reported experiencing 74% less stress and 40% less burnout, leading to 106% more energy at work,13% fewer sick days and 29% more satisfaction with their live.

3. Enhanced leadership and decision-making

For senior leaders, trust creates strategic leverage. In boardrooms, trust enables frank discussions about challenges and opportunities, leading to better-informed decisions. High-trust boards provide meaningful strategic guidance while respecting management’s operational autonomy. CEOs can share emerging challenges openly, enabling proactive problem-solving rather than defensive reporting.

This dynamic extends through the leadership chain. When middle management trusts senior leadership’s direction, resources flow more efficiently to strategic priorities. Change initiatives move faster because people believe in the stated rationale rather than searching for hidden agendas. Innovation flourishes because employees trust they can take calculated risks without career-ending consequences.

4. Overcoming resistance to change

Change initiatives fail at an alarming rate – in fact, 78% of corporate transformations fail. The most critical factor in whether an organizational change is successful or not is trust. In the absence of trust, even the smartest change initiatives collapse under the weight of resistance, skepticism, and passive opposition.

Trust transforms how employees experience organizational change. Instead of viewing new initiatives with suspicion and self-preservation, employees in high-trust environments engage constructively, believing leadership has considered their interests and perspectives. People do not feel that their job is at risk if they speak up about concerns or experiment with new approaches. As a result, the organization is able to maintain resilience throughout the inevitable ups and downs of a large organizational change.

Without trust, even minor changes trigger defensive reactions that can paralyze an organization. Employees may resist openly or passively: for example, by withholding crucial feedback, or creating workarounds that undermine implementation. No amount of strategic planning or technical excellence can overcome this fundamental barrier to change.

5. Improved innovation and collaboration

In high-trust environments, decisions move swiftly through the organization because people believe in their leaders’ competence and intentions. Middle managers execute strategy confidently, without the endless questioning and second-guessing that plagues low-trust environments. Teams surface problems early and tackle them collaboratively, preventing minor issues from escalating into crises.

High-trust organizations can execute more ambitious strategies, attract better talent, and build more durable stakeholder relationships. They can move faster, innovate more boldly, and recover more quickly when initiatives don’t succeed as planned.

6. Enhanced organizational resilience

Particularly during challenging times, high-trust organizations demonstrate remarkable resilience. These organizations can maintain productivity during uncertainty, adapt quickly to market changes, and recover faster from setbacks. Their stakeholder relationships – with customers, suppliers, and communities – provide vital support during crises rather than becoming additional pressure points.

Breaking trust: common pitfalls

Trust is extremely fragile. Like money, it is easy to “spend”. There are the more obvious ways for leaders to diminish trust: for example, ethical violations (corruption, misuse of company assets or data breaches) and not upholding promises (to employees and/or customers). However, there are more subtle ways to spend trust that can be more insidious, like a slow leak in a water tower.

1. Unfair practices

Unfair practices permeate organizations in ways that many leaders fail to recognize. When favouritism determines employee advancement or preferential treatment/pricing/contracts for select customers and suppliers, the damage ripples throughout the organization. Each instance of unfairness, no matter how small, will chip away at organizational credibility and poison stakeholder relationships.

2. Poor communication, lack of transparency

Poor communication creates dangerous information vacuums within organizations. When leaders withhold information or fail to communicate clearly, employees and stakeholders will fill the void with speculation. A lack of transparency from leadership will be interpreted as leadership not trusting their employees and stakeholders, resulting in reduced engagement, lower productivity, and growing skepticism toward organizational initiatives.

3. Inconsistency

Inconsistent organizational practices foster distrust. Uneven policy application, unannounced rule changes, and erratic decision-making often create an environment of uncertainty and suspicion. As unpredictability becomes the expected norm, employees will learn to question every decision and look for hidden agendas, making future trust-building nearly impossible.

4. Ignoring stakeholder interests

Not balancing (or outright neglecting) stakeholder interests against organizational interests will weaken and break any trust stakeholders have to give. By prioritizing short-term gains over stakeholder needs, organizations are clearly demonstrating that stakeholder relationships are merely transactional. This approach will inevitably lead to a stakeholder exodus as they seek partners who value long-term, collaborative relationships over immediate advantages.

Measuring trust: can it be quantified?

Given the importance of trust, how can leaders accurately measure the amount of trust their organization holds? How can leaders know if they are growing trust or bleeding trust?

Unfortunately, it’s not as simple as measuring revenue or compiling net promoter scores. Measuring trust requires thoughtful consideration in order to gain accurate and relevant trust insights for each major stakeholder group (employees, customers, vendor/suppliers, members, etc.).

Leaders must first define what trust means for each of these stakeholder groups. Next, leaders will need to determine what types of trust they want to measure. For example, is it important to understand how much employees trust the CEO, or just their direct managers? Is it necessary to assess how much customers trust your organization’s internal and external ethics, or just how much clients trust the quality of products and services?

Based on these considerations, leaders can utilize one or a combination of the following approaches to surface the information needed to determine the baseline measures of trust and track progress made against improving those measures.

Measuring trust: 3 core approaches

By combining behavioral data, survey results, and interview insights, leaders will be able to spot exactly where trust needs strengthening and what specific changes will have the biggest impact.

Behavioural metrics: actions speak louder

When measuring organizational trust, behavioral data provides more reliable insights than self-reported information. Observable actions reveal authentic trust levels through quantifiable patterns of engagement and commitment across stakeholder groups. Unlike surveys or interviews, behavioral metrics capture actual decisions and choices rather than stated intentions.

Here are examples across two stakeholder groups of observable behaviours and how to utilize as them as trust measurements: 

Employees:

• Behaviour: Openness in internal surveys regarding management practices.
  • Measure: Assess the number and quality of fully completed anonymous surveys about management. High response rates and candid feedback in these surveys may indicate that employees trust both the confidentiality of the process and management’s commitment to constructive action.
• Behaviour: Employee referrals for open positions.
  • Measure: Track the number of staff-referred candidates for open positions. High referral rates indicate employees trust the organization enough to stake their professional reputation on recommending it to their network.
• Behaviour: Engagement in company-led initiatives.
  • Measure: Monitor engagement rates in optional initiatives like professional development and wellness programs. High voluntary participation rates demonstrate employees trust the organization’s commitment to their growth and wellbeing.

Customers:

• Behaviour: Repeat purchases or subscriptions.
  • Measure: Track frequency of repeat purchases within defined periods. High retention rates demonstrate trust in product quality and service consistency.
• Behaviour: Customer referrals.
  • Measure: Record the number of customer-initiated referrals. Strong referral rates indicate customers trust your brand enough to risk their personal credibility by recommending you.
• Behaviour: Positive reviews and ratings.
  • Measure: Assess the ratio of positive to negative reviews. A consistently high positive review ratio reflects customer trust in product quality and overall experience.

Quantitative surveys: structured insights

Quantitative surveys are a valuable tool for measuring organizational trust at scale. Standardized questions with fixed responses enable tracking of trust levels across departments and roles, reveal patterns, and measure the impact of trust-building initiatives. The data’s consistency makes it possible to compare results over time and across different parts of an organization, clearly showing where trust-building efforts succeed or fall short.

It is vital for leaders to spend up-front time in creating the right questions. Here are some sample survey questions to consider for your stakeholder groups: 

Employees:

• On a scale of 1-10, how confident are you in the leadership’s ability to make decisions that are in the best interests of both employees and the company?”
• Rate your agreement with this statement: ‘I believe my manager will communicate important information transparently.’ (1 = Strongly Disagree, 10 = Strongly Agree)
• How likely are you to recommend this company as an employer to a friend or family member? (1 = Not Likely, 10 = Very Likely)

Customers:

• On a scale of 1-10, how much do you believe our products/services will meet your expectations consistently?
• How satisfied are you with the way our customer service team handles your queries and concerns? (1 = Very Dissatisfied, 10 = Very Satisfied)
• How likely are you to continue using our products/services? (1 = Not Likely, 10 = Very Likely)

Business partners:

• Rate your belief our company will fulfill its contractual obligations. (1 = No Trust, 10 = Complete Trust)
• How effectively do you think our company communicates changes and updates that may affect your business? (1 = Very Ineffectively, 10 = Very Effectively)
• On a scale of 1-10, how likely are you to engage in long-term partnerships with our company?

Other frameworks such as the OECD Guidelines on Measuring Trust or Leadership Trust Index can also help inform your survey design. When the survey is ready to be launched, it’s important to also consider the process by which information will be collected:

1. How will the survey be delivered, and the results compiled?
2. Is there a large enough sample size?
3. Can respondent anonymity be guaranteed?

Guaranteed anonymity is crucial – it both ensures honest feedback and demonstrates organizational trust in practice.

Qualitative interviews: deep understanding

While quantitative measures provide the what, qualitative interviews reveal the why. Through open-ended conversations, leaders can uncover what truly builds or erodes trust among their people. Unlike surveys, these discussions allow leaders to probe deeper when they spot something interesting or concerning.

Here are some sample questions to use as thought-starters:

Employees:

Leadership trust:

• Can you describe a recent decision by senior management that impacted your trust in them? What would you have preferred to see?
• How consistently do you think management’s actions reflect the company’s stated values?

Peer trust:

• How comfortable do you feel relying on your colleagues for help or to fulfill their responsibilities?
• Can you share an example where a colleague either significantly increased or decreased your trust in them?

Customers:

Product trust:

• What aspects of our products make you feel confident in their quality and reliability?
• Have you ever experienced a product issue that led you to question our quality? How was it handled?

Customer service trust:

• Can you describe a memorable interaction with our customer service team that influenced your trust in our company?
• What improvements would you suggest to enhance transparency and trust in our customer service?

Partners:

Organizational integrity:

• How has your experience been with our commitment to business agreements and ethical standards?
• Can you provide an example where our organization either met or failed to meet your expectations in terms of ethical conduct?

Communication:

• How effective do you find our communication regarding project updates and collaborative efforts?
• What changes would help in building a stronger foundation of openness between our organizations?

The 3 pillars of building organizational trust

Building organizational trust requires deliberate focus on three fundamental pillars: strategic clarity, values alignment, and communication architecture. Each pillar has a distinct but interconnected role in creating the conditions where trust can flourish.

1. Strategic clarity

A major impediment to trust within any organization is the absence of strategic clarity. When the overarching strategy is not crystal clear to all levels of the organization — from the Board and CEO to management and, crucially, to front-line staff — it creates fertile ground for mistrust and misalignment.

Here are some examples of what a lack of strategic clarity could look like for each group:

• Board and CEO: both parties have the same list of strategic priorities but have a different view of which items are more important and/or should be approached. This misalignment then leads to a breakdown of trust within these critical leadership dynamics.
• Middle management: The executive team are passing down conflicting directives – the CFO has announced a 15% cost reduction target but the COO has also just launched a major quality improvement program that requires significant investment. The CEO has not explicitly addressed how these two competing priorities are to be reconciled. Middle managers do not know which executive’s version of strategy is the “right” choice and are left to guess. As a result, decisions stall at every level, creating a chain reaction of indecision that ultimately delivers subpar results.

If front-line employees are unclear about the organization’s strategic direction, they may inadvertently act in ways that conflict with organizational goals. Such actions, when corrected, can leave employees feeling marginalized and undervalued, resulting in eroded trust. When senior leaders like the Board and CEO are not aligned on the strategy, it can lead to a breakdown of trust within these critical leadership dynamics. This misalignment may not necessarily reflect a lack of strategic competence but rather a failure to communicate the strategy effectively across all organizational echelons.

Strategic clarity stands as the foundation of organizational trust. As a leader, your strategy must resonate clearly from boardroom to front line. In our experience, when we see trust breakdowns, strategic ambiguity is often the root cause. Ensure your strategic narrative connects directly to daily operations and is reinforced consistently through decisions and actions.

2. Values alignment

Values alignment becomes critical at the executive level, where actions speak louder than words. Consider this real-world example: A company prominently displayed its “no jerks” policy among its core principles and office decor. Yet a senior executive regularly exhibited behavior that contradicted this value and was never reprimanded, regardless of the problems this executive’s behaviour caused. As a result, this misalignment didn’t just impact individual situations — it fundamentally undermined the organization’s credibility and eroded trust across all levels.

For senior leaders, “walking the talk” isn’t about perfection. It’s about consistency and accountability. When values are applied uniformly, regardless of position or circumstances, leaders create workplace cultures where trust can flourish.

This requires making difficult decisions that align with stated principles, even when expedient alternatives present themselves. Leadership actions, especially in challenging situations, either reinforce or undermine the trust currency within the organization.

3. Strategic repetition

In the business world, the power of repetition in building trust is often underestimated. While marketers understand that messages need multiple touchpoints to drive action, many leaders fail to apply this principle to organizational communication. The result? Information vacuums that quickly fill with speculation and misunderstanding, eroding trust one assumption at a time.

The solution isn’t just more communication. It’s strategic repetition of key messages through multiple channels and contexts. When communicating important initiatives or organizational changes, leaders must embrace what may feel like over-communication. Each repetition serves as an opportunity to reinforce trust by ensuring alignment, understanding, and commitment across the organization.

Instead of an organizational inefficiency, highly effective leaders view repetition as a strategic investment in trust building. Regular reinforcement of key messages creates shared understanding and strengthens the bonds of trust that hold organizations together.

Success in building organizational trust ultimately depends on three fundamental elements: clear strategic priorities at all levels, consistent alignment between values and actions, and persistent, clear communication of key messages. These pillars form the foundation upon which lasting organizational trust can be built.

Next steps

The challenge for today’s leaders lies not in understanding trust’s importance, but in creating systematic approaches to building and measuring it. This requires moving beyond intuitive leadership to implementing structured frameworks for measuring trust through behavioral metrics, quantitative surveys, and qualitative feedback.

More importantly, trust operates as a two-way street: measuring and tracking stakeholder trust must be paired with demonstrable organizational trustworthiness through transparent communication, consistent behavior, and ethical decision-making.

Trust builds slowly over time through consistent deposits of reliable behavior, clear communication, and demonstrated integrity. The organizations that will thrive in tomorrow’s complex business landscape won’t just be those with the best strategies or the most innovative products – they’ll be those that have mastered the art and science of building, maintaining, and leveraging trust as their competitive advantage.

Additional resources

If you enjoyed this insight or found it useful, you may also like:

• Mastering Organizational Change: An Executive’s Guide to Effective Transformation (Ebook)
• Strategic Agility: 10 Change Management Essentials (Course)
• Navigating Uncertainty: People-Centred Organizational Resilience (Insight)