Employee trust low in bosses of recession-hit companies

Employees whose organisations have been hit hard by the recession have low levels of trust in their bosses and blame lies with poor management, according to research released today.

Organisations who have responded to the recession with compulsory redundancies have seen a sharp drop of trust in their senior management while, in contrast, companies that have combated the recession with a more measured response, such as flexible working and budget cuts, have seen trust in their CEOs rise.

The research, published by the Institute of Leadership & Management (ILM), also found that levels of trust in senior management in the public sector are lower than those in the private sector for the second year running, and local and national government CEOs have some of the lowest trust levels of any sector. With budget cuts set to affect jobs, pensions and service delivery, levels of trust are likely to sink further in the public sector over the coming months, said the report.

Penny de Valk, chief executive of ILM, said: “It is clear that the actions of senior managers are scrutinised to a far greater extent during times of crisis, and major cuts are often seen as the direct result of poor management – even when this might be beyond their control.”

Female bosses, however, have managed to gain higher trust levels despite the recession. Trust in executive women has increased since last year and they are more trusted than their male counterparts. Women scored better than men in understanding employees’ roles and were also rated strongly in terms of ability and integrity.

The 2010 Index of Leadership Trust surveyed 5000 employees from private, public and voluntary sectors.

Other key findings include:

• Overall trust in CEOs has increased, suggesting that well-led organisations have emerged from the recession with a more trusting workforce
  
• Senior managers in the charity sector enjoy the highest levels of trust.
  
• Employees believe the most important drivers of trust are ability, integrity and understanding.
  
• The size of the organisation has a major impact on trust levels. The greater the distance between employee and line manager, the lower the level of trust.