2013 emerging market supplement trust barometer indonesia
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Transcript of 2013 emerging market supplement trust barometer indonesia
INDONESIA FINDINGS
Edelmantrustbarometer2013 emerging market supplement
TRUST
• Trust is leading indicator of reputation• Trust in society is correlated with economic
growth and prosperity(study by Paul Zak & Stephen Knack)
BUSINESS REPUTATION IS BUILT ON TRUST
• Trust within the community is essential to a business’s operations.
• Long term business success is built on trust, whether within the local, the national, or the global community.
2013 TRUST BAROMETER: EMERGING MARKETS SUPPLEMENT
4
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 Indicates Global Data
Indicates Indonesia Data
Indonesia 74
Mexico 82
China 74
India 81
US 62
UK 56
Germany 48
France 44
DIS
TRU
STER
STR
UST
ERS
NEU
TRAL
TRUST IN BUSINESS IN MAJORITY OF EMERGING MARKETS TRENDING UPWARD
5
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
2013Field date: Q4 2012
2013 Emerging Markets Supplement
Field date: Q3 2013
8 MARKET AVERAGE: 56 8 MARKET AVERAGE: 65 9 MARKET AVERAGE: 67
2012Field 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
77% TRUST IN
BUSINESS IN INDONESIA
MARKET AVERAGE
67%VS.
Image: republika.co.id
2013
33 point gap between developed and
emerging market trust
2009 2010 2011 2012 201320%
30%
40%
50%
60%
70%
80%
90%
Brazil
China
France
Germany
India
Russia
UK
USA
EMERGING MARKET HEADQUARTERED COMPANIES HAVE DECLINING TRUST SINCE 2011GLOBAL TRUST ACCORDING TO WHERE MNCs ARE HEADQUARTERED
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:
• Tangible actions dominate: Perceived poor performance against concrete trust-building actions (e.g., supply chain management, IP protection, etc.) erodes trust.
• 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.
THE STATE OF TRUST IN EMERGING MARKETS AND INDONESIA
10
50%
11
DEVELOPED MARKET-BASED MNCs HAVE 33-POINT TRUST LEAD OVER MNCs HEADQUARTERED IN EMERGING MARKETSMOST TRUSTED NATIONAL IDENTITY FOR COMPANIES – GLOBAL VIEW
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
Germany UK US France Brazil South Africa
Russia India China Mexico Indonesia
80% 78%72% 72%
47% 45% 44% 43% 42% 40% 39%
TRUST DIVIDEND
• European and American based businesses gain from a trust dividend in emerging markets, including in Indonesia.
A 33-POINT TRUST LEAD OVER MNCs HEADQUARTERED IN EMERGING MARKETS
12
Image: wikipedia
50%
13
INDONESIAN HEADQUARTERED COMPANIES BENEFIT FROM A 32 POINT TRUST BONUS AMONG DOMESTIC POPULATIONMOST TRUSTED NATIONAL IDENTITY FOR COMPANIES – INDONESIAN VIEW
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
Germany UK France US Indonesia Russia China Brazil Mexico India South Africa
91% 89%85% 84%
71%65%
61%55%
51% 50%45%
Developed Markets 87% Emerging Markets 57%
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 COMPANIESTRUST RELATED TO COMPANIES’ NATIONAL IDENTITY
14
Indonesia-Based MNCs South Africa-Based MNCs
India-Based MNCsChina-BasedMNCs
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
• Indonesian companies are mid-ranking in trust among emerging market companies operating in the west.
• Indian and Brazilian companies are slightly more trusted in the west than other emerging market companies.
15
TRUST GAP
16
• Why are Indonesian companies struggling to gain trust abroad?
• One of the issues is likely to be low brand familiarity – can you name an Indonesian MNC operating abroad?
TRUST GAP
LOW BRAND FAMILIARITY
18
PROMPTED AWARENESS OF BRIC MARKET BRANDS BY MARKET
BRIC-BASED MNCs HAVE TO RAISE OVERSEAS AWARENESS; CONSUMER-FACING BRANDS MAKING PROGRESS
RUSSIA
BRAZIL
INDIA
CHINA
50%
Petrobras Vale
26%
9%
38%
11%
Lenovo Air China Bank of China Haier
72%
63%54%
45%
70% 68%63%
26%
89%79%
87%81%
Tata Infosys
25%36%
54%
23%
99% 98%
Gazprom Lukoil
20%30%
65%
23%
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
India* Russia China* Brazil0%
20%
40%
60%
80%
14% 12% 10% 10%5% 4% 3% 2%
BRIC COMPANY CEOs HAVE LOW VISIBILITY GLOBALLY, ESPECIALLY IN DEVELOPED MARKETS
19
UNPROMPTED AWARENESS OF BRIC MARKET COMPANY CEOs or CHAIRPERSONS BY MARKET
Top CEOs† Emerging Developed Emerging Developed Emerging Developed Emerging Developed
1 Ratan TataTata
Ratan TataTata
Alexey MillerGazprom
Alexey MillerGazprom
Yang YuanqingLenovo
Yang YuanqingLenovo
Maria das Graças Silva Foster
Petrobras
Maria das Graças Silva Foster
Petrobras
2 Naveen JindalJindal Steel
Power Limited
N. R. Narayana MurthyInfosys
Oleg DeripaskaBasic Element
CompanyAndrey Kostin
VTB BankRobin Li
BaiduHong Qi
Minsheng Banking Corp
Murilo Pinto de Oliveira Ferreira
ValeEike BatistaEBX Group
3 Mukesh AmbaniReliance
Industries
Mukesh AmbaniReliance
IndustriesAndrey Kostin
VTB BankOleg DeripaskaBasic Element
CompanyRen Zhengfei
HuaweiFu Chengyu
SinopecRicardo Semler
Semco SAMurilo 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
20
INDONESIAN COMPANIES AND CEOs NEED TO RAISE THEIR PROFILE ABROAD
• More engagement
• Be more active in public discourse – establishing yourself as a thought and industry leader
• Raise your profile and visibility
21
INDONESIAN COMPANIES AND CEOs NEED TO RAISE THEIR PROFILE ABROAD
• This will all contribute to growing trust. Growing trust equals a more positive reputation. A positive reputation makes it easier for your business to operate in the community.
• TRUST BUILDING IS A MUST!
TANGIBLE ACTIONS DOMINATE
23
Big difference in most important trust building attributes for Indonesians.
Indonesian priorities differ from the developed market norm…
DIFFERENCE IN TRUST BUILDING ATTRIBUTES
24
CONSISTENT FINANCIAL RETURNS
TOP GLOBAL COMPANY
ADMIRED TOP LEAD-ERSHIP
PARTNERS W/ 3RD PARTIES
INNOVATOR
POSITIVELY IMPACTS COMMUNITY
ADDRESSES SOCIETY'S NEEDS
PROTECTS ENVIR-ONMENT
CUSTOMERS BEFORE PROFITS
LISTENS TO CUSTOMERS
LOOKS AFTER EM-PLOYEES
COMMUNICATES OFTEN
ACTS RESPONSIBLY IN CRISIS
IS ETHICAL
HIGH QUALITY PRODUCTS
TRANSPARENT & OPEN
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%
TRANSPARENT & OPEN
PARTNERS W/ 3RD PARTIES
TOP GLOBAL COMPANY
PROTECTS ENVIRONMENT
INNOVATOR
COMMUNICATES OFTEN
LOOKS AFTER EMPLOYEES
ACTS RESPONSIBLY IN CRISIS
CUSTOMERS BEFORE PROFITS
IS ETHICAL
CONSISTENT FINANCIAL RETURNS
ADDRESSES SOCIETY'S NEEDS
HIGH QUALITY PRODUCTS
ADMIRED TOP LEADERSHIP
LISTENS TO CUSTOMERS
POSITIVELY IMPACTS COMMUNITY
73%
70%
71%
70%
72%
73%
71%
72%
70%
72%
75%
71%
76%
72%
73%
73%
79%
80%
81%
82%
83%
83%
83%
84%
84%
84%
84%
84%
85%
86%
86%
87%
DEVELOPED MARKETS PERCEIVE A LARGE GAP IN EXPECTATIONS VS. PERFORMANCE ON KEY TRUST BUILDING ATTRIBUTES FOR BRIC-BASED MNCS
FOR INDONESIANS, COMMUNITY INVOLVEMENT, LISTENING TO CUSTOMERS AND ADMIRED TOP LEADERSHIP ARE SEEN AS THE MOST IMPORTANT TRUST BUILDING ATTRIBUTES
INTEGRITYENGAGEMENT PURPOSEPRODUCTS & SERVICES OPERATIONS
STATED IMPORTANCE VS. COMPANY PERFORMANCE (TOP 4 BOX)
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”)
Q80-Q96. [TRACKING] How important is each of the following actions to building your TRUST in a company? 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. (Top 2 Box, Very/ Extremely Important) General Population in 26-country global total (excludes ‘Don’t Know’ responses Q114-Q129. Please rate [INSERT COMPANY] 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 2 Box, Performing Very/ Extremely Well) General Population in 26-country global total
FROM EDELMAN TRUST BAROMETER 2013 GLOBAL SURVEY: DIFFERENCE IN PRIORITIES BETWEEN THE ANNUAL SURVEY AND THE EMERGING MARKET SUPPLEMENTHOWEVER, INDONESIANS MORE DRIVEN BY SOCIAL ISSUES IS STILL A CONSISTENT THEME
26
COMMUNITY – THE NUMBER ONE PRIORITY FOR INDONESIANS!
• Indonesians expect companies to operate with a social conscience.
• Strong Corporate Social Responsibility (CSR) programs and community outreach is mission critical to doing business in Indonesia. Image: World Bank
27
COMMUNITY – THE NUMBER ONE PRIORITY FOR INDONESIANS!
•Poor community engagement will result in poor trust levels – this eventually will have a negative impact on business operations...
•Neglect the community at your peril…
THE PATH FORWARD
29
DELIVERING A MESSAGETo communicate your message with authenticity and trust, use academics and experts as spokespeople in Indonesia.
Regular employees, unlike the market norm, are taken less seriously…
Image: gettyimages.com
RECOMMENDATIONS FOR PROMOTING INDONESIAN AND BRIC HEADQUARTERED COMPANIES OVERSEAS
30
BUILD YOUR BRAND
BE MORE PROACTIVE AND TRANSPARENT
FOCUS ON ETHICAL BEHAVIORS
USE EXPERTS AND EMPLOYEES AS SPOKESPERSONS, NOT CEO
31
Key Pointers For Doing Business and Building Trust In Indonesia
Developed market based companies benefit from a trust dividend in Indonesia; they are more trusted than all emerging market based companies, including Indonesian companies.
Indonesian’s still have high levels of trust in business – significantly higher than the market average.
32
Key Pointers For Doing Business and Building Trust In Indonesia
Indonesian based companies are the most trusted emerging market based companies in Indonesia –Indonesian’s are loyal to home grown MNCs.
European and American companies have a trust advantage in Indonesia.
33
Key Pointers For Doing Business And Building Trust In Indonesia
Companies are expected to exercise social responsibility and a real commitment to local societal issues.
Community engagement really does matter in Indonesia; it is the number one trust driver.
Stephen LockEdelman Indonesia
THANK YOU