.png)
For a factor so consistently linked to financial outperformance, trust receives remarkably little attention. Yet, across industries, geographies, and company sizes, data points to trust as a multiplier in corporate performance.
Companies that cultivate high internal trust enjoy dramatically better financial outcomes, greater productivity, and remarkable employee retention. The evidence suggests a causal relationship that requires exploration: trust drives productivity and profit.
The Bottom Line
The numbers are remarkable. Companies on Fortune's 100 Best Companies to Work For list earn 8.5 times more revenue per employee than the average firm and outperform competitors on nearly every metric. Public companies in this category have beaten the market by a factor of 3.5 over 27 years, generating cumulative stock returns of 3,174% compared to the Russell 1000 Index's 907%.
These companies achieve these results without downsizing or burning out employees. The performance boost comes from leadership behaviours, not perks. Trust develops through how leaders act and make employees feel, with 90% of workers at these high-trust companies describing their workplace as caring.
“That doesn’t happen by giving them perks like free food or Apple watches. If it were that simple, every workplace would be great. It happens by listening to people and involving them in decisions that affect them.” says Michael C. Bush, CEO of Great Place To Work.
The advantage goes beyond the balance sheet. According to research by Paul Zak, a neuroeconomist at Claremont Graduate University, employees at high-trust companies are 50% more productive, take 13% fewer sick days, and experience 74% less stress than those at low-trust organizations.
The Science of Trust
The trust-performance link has physiological underpinnings. Zak’s research identified oxytocin, sometimes referred to as the “trust hormone”, as the biological mechanism.
When leaders engage in behaviours that increase oxytocin production, employees demonstrate greater cooperation, engagement and performance. Zak’s team established that oxytocin levels directly predict trustworthy behaviour. More importantly, they identified eight management behaviours that stimulate its production:
- recognizing excellence promptly and publicly;
- assigning challenging but achievable tasks;
- granting meaningful autonomy;
- enabling job crafting;
- sharing information transparently;
- building relationships intentionally;
- facilitating holistic growth;
- and demonstrating vulnerability.
The most effective trust-building approaches often cost little to implement. For instance, employees are 4.3 times more likely to trust leaders who explain their decisions, especially during uncertain periods (sharing information transparently). They’re 6.5 times more likely to trust leaders who show genuine concern for their welfare (building relationships intentionally).
The Trust Triangle
The primacy of trust raises a natural question: how can leaders identify and address their own trust deficits?
“People tend to trust you when they believe they are interacting with the real you (authenticity), when they have faith in your judgement and competence (logic), and when they feel that you care about them (empathy),” they write. “When trust is lost, it can almost always be traced back to a breakdown in one of these three drivers.”
Most leaders have a consistent “trust wobble”, a particular driver that repeatedly undermines their trustworthiness. Identifying this weakness is the first step toward strengthening it.
For those struggling with empathy, the solution may be as simple as putting away mobile devices during meetings to demonstrate full presence.
Those with logic wobbles could benefit from data-driven decision-making and clear, upfront communication of key points.
Authenticity challenges require embracing one’s genuine self, even when it feels uncomfortable.
Building a High-Trust Culture
Organizations and HR Leaders build a high-trust culture most effectively through deliberate, multi-faceted approaches. Gartner research suggests four key strategies for people leaders:
First, assess trust through employee surveys and focus groups, then transparently communicate findings alongside concrete action plans.
Second, encourage decision-making transparency, with leaders providing clear explanations for their actions.
Third, facilitate regular, open dialogue between employees and senior leadership to identify shared values and address concerns.
Finally, invest in skills development programs for senior leaders, as well as employees, focused on emotional intelligence, active listening, ethical decision-making, and transparent communication.
These interventions directly address behaviours that erode trust. According to Gartner, “A lack of trust most often stems from senior leaders withholding information, scapegoating or retracting decisions.”
Transitions That Strengthen
Forward thinking organizations view career development and transitions, including departures, as crucial trust-building moments. Traditional outplacement and career development services, often transactional and standardized, are giving way to personalized technology-enhanced career support that demonstrates organizational commitment to employee welfare regardless of tenure.
These modern solutions signal to employees that the organization values their long-term success, even when that success occurs elsewhere. Such signals of authentic care reinforce the empathy dimension of trust, particularly during organizational changes when trust is most vulnerable to erosion.
Recognizing The Limitations
Despite all its benefits, trust is not a panacea. High-trust cultures cannot compensate for strategic errors or economic shocks. Rather, trust serves as a performance multiplier, amplifying strengths and providing resilience during challenges.
Moreover, trust-building efforts must be genuine to be effective. Performative gestures without substantive commitment may actually undermine trust further. As with most organizational initiatives, authenticity matters.
The Ultimate Competitive Edge
High-trust organizations enjoy distinct advantages in both productivity and recruitment. They experience less friction in operations, greater discretionary effort, and more effective knowledge-sharing.
For HR leaders and executives, building trust is not just a moral imperative, but a necessity with measurable returns. Organizations that cultivate trust through evidence-based practices position themselves for sustainable outperformance.
The formula is simple: set clear direction, provide the necessary resources, demonstrate care for employees as people, and then, most importantly, get out of their way. As Zak concludes, “High-trust companies hold people accountable but without micromanaging them. They treat people like responsible adults.”
Ultimately, trust may be invisible on corporate balance sheets, but it’s the asset with the highest return on investment.
Let's chat about supporting your
people with Thrive.
Our team will be in contact within 2 business days.
