As much as 49% of Indian opinion leaders interviewed expressed growing concerns about business in India even before the Satyam news broke, according to the 10th Edelman Trust Barometer released in Mumbai today. These concerns about business are not unique to India — 59% for the APAC region, 56% for China, 67% for the UK and 77% for the US.

The survey, undertaken between November 5 – December 14, 2008, indicates that the percentage of those in India who trust business to do what is right has fallen by 9%, from 74% in the previous year to 65%. In the US, the percentage has fallen by 20%, from 58% to 38%. Globally, business has lost trust with 62% saying they trust corporations less today than they did a year ago.

CEO credibility has also fallen globally but the fall in India is marginal (from 66% to 60%), against a six-year low of 23% in the US and a fall from 44% in 2008 to 19% in 2009 in China.

A majority of opinion leaders concede that government should impose stricter regulations and greater control over business across all industries.

Business has lost credibility to lead unilaterally…

“A major concern is that business appears to have lost credibility to lead unilaterally. Clearly, today it must partner with others to solve issues like global warming, the financial crisis, healthcare and energy — 65% in India believe that business must partner with governments and third parties like NGOs, with only 33% believing it must do what it can alone and 2% believe it has no role to play,” said Mr. Alan VanderMolen, President, Edelman Asia-Pacific.

Despite the worldwide economic and financial crisis, in ten of thirteen business sectors in India, trust is stronger than last year as against China, where only 4 of the 13 sectors show stronger trust than 2008. Top industry sectors in India include technology (93%, same as last year); automotive (80%, same as last year); healthcare (80%, up slightly by five points from 2008) and its related industry pharma (81%, up slightly by 3 pts.).

Interestingly, companies headquartered in UK and Germany remain the most trusted in India; companies in China and Poland are least trusted; and trust in US companies has suffered the biggest decline.

High Expectations

Indian companies are expected to move quickly and make changes to correct problems and difficulties when they arise (87% and 86%, respectively). They are also expected to admit their mistakes (81%).

Greater support for responsible companies

India is more supportive of responsible companies than most countries. This includes support for preferential treatment for tax, employment and environmental practices; pursuing changes in local laws or permissions and even allowing foreign investors a controlling interest in local companies.

The global 2009 Edelman Trust Barometer found that Government and business share the lion’s share of responsibility for the global problems of the financial meltdown, global warming, affordable health care and the energy crisis. On the other hand, they place the burden of responsibility for solving these problems on the shoulders of government. Business is expected to play a role in support of government (62%) and approximately 7 out of 10 expect business to find and invest in solutions to each of these problems.

Media enjoys higher credibility in India

Respondents give all forms of media higher scores for credibility than other countries in the APAC region. It is second only to South Korea in trust extended to the traditional media and is the leader in trust given to corporate communication sources. Academic spokespersons got the highest credibility ratings in India (74%). CEOs in India also enjoy higher credibility ratings than any other country in the APAC region.

Examining the drivers of a good and responsible reputation, India is similar to Indonesia in its emphasis of CSR behavior. Committing resources, money and time to the greater public good as well as a strong commitment to environmental protection is very important to a good and responsible reputation in India.

Sixty percent said they need to hear information about a company three to five times before they believe it. Specialists remain the most trusted purveyors of information about a company, with 62% globally saying an academic or expert on a company’s industry or issues would be extremely or very credible.

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