China

2016 Edelman Trust Barometer

Informed Public

‣ 9 years in 20+ markets‣ Represents 15% of total population‣ 500 respondents in U.S. and China; 200 in all other countries

Must meet 4 criteria: ‣ Ages 25-64‣ College-educated‣ In top 25% of household income per age group in each market‣ Report significant media consumption and engagement in business news

General Online Population

‣ 5 years in 25+ markets‣ Ages 18+‣ 1,150 respondents per country

Methodology

28-country/area global data margin of error: General Population +/-0.6% (N=32,200), Informed Public +/- 1.2% (N=6,200), Mass Population +/- 0.6% (26,000). Country-specific data margin of error: General Population +/- 2.9 ( N=1,150), Informed Public +/- 6.9% (N = min 200, varies by country), China and U.S. +/- 4.4% (N=500), Mass Population +/- 3.0 to 3.6 (N =min 740, varies by country), half sample Global General Online Population +/- 0.8 (N=16,100).

‣ 16 years of data‣ 33,000+ respondents total‣ All fieldwork was conducted

between October 13th -November 16th, 2015

Online Survey in 28 Countries

Mass Population

‣ All population not including Informed Public‣ Represents 85% of total population

2

3

1 State of Trust

49 Ireland47 Turkey46 Sweden42 Poland42 Russia41 Japan

49 Australia49 Italy49 U.S.47 Hong Kong46 Spain45 S. Africa42 Germany42 S. Korea42 U.K.41 France41 Ireland41 Turkey39 Russia38 Japan37 Sweden35 Poland

73 China66 UAE65 India64 Singapore62 Indonesia60 Mexico

82 China78 India74 UAE72 Mexico72 Singapore70 Indonesia64 U.S.63 Australia63 Canada62 Netherlands61 Colombia

56 Canada55 Colombia52 Netherlands51 Argentina51 Malaysia50 Brazil58 Brazil

58 Italy58 Malaysia57 U.K.55 France54 S. Africa53 Argentina53 Spain52 Hong Kong51 Germany50 S. Korea

Trust Index:General Population LagsAverage trust in institutions, Informed Public vs. General Population, 2016

Nearly 6 in 10 countries are

distrusters among the General Population

The Trust Index is an average of a country’s trust in the institutions of government, business, media and NGOs. 28-country/area global total.

InformedPublic

GeneralPopulation

60 Global 50 Global

4

Trusters

Neutrals

Distrusters

51 48 45 41

55 5347 42

6357

51 48

67 6357

51

Trust Rising

Source: 2016 Edelman Trust Barometer Q11-14. Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a nine-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 Public and General Population, 27-country/area global total.

5

Percent trust in the four institutions of government, business, media and NGOs, 2015 vs. 2016

NGOs Business Media Government

+4 +6 +6 +3Informed

Public

General Population +4 +5 +2 +1

2015 2016

54 5864

7571 70 7379

72 7077 8283 80 81

86

Trust Rising

Source: 2016 Edelman Trust Barometer Q11-14. Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a nine-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 Public and General Population, China.

6

Percent trust in the four institutions of government, business, media and NGOs, 2015 vs. 2016

Informed Public

General Population

NGOs Business Media Government

+11 +10 +4 +4

+17 +12 +9 +4

2015 2016

76

80 79

75

82

68 69

65

61

71

2012 2013 2014 2015 2016

A Significant Divide

Source: 2016 Edelman Trust Barometer Q11-14. Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a nine-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 Public and Mass Population, China.

7

Percent trust in the four institutions of government, business, media and NGOs, 2012 to 2016 Informed

Public

MassPopulation

11pt

Gap8pt

Gap

Trust Index 2012 – 2016, percentage point change in the size of the trust gap between Informed Public and Mass Population

An Accelerating Disparity

Source: 2016 Edelman Trust Barometer Q11-14. Below is a list of institutions. For each one, please indicate how much you trust that institution to do what is right using a nine-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 Public and Mass Population, 25-country/area global total, 2012 vs 2016.

GDP 5 = U.S., China, Japan, Germany, U.K. 8

Increased Gap Decreased Gap

Gap has increased in 16 of 25 countries

Glo

bal 2

5

GD

P 5

Fran

ce

U.K

U.S

.

Spai

n

Mex

ico

Sing

apor

e

S. K

orea

Mal

aysi

a

Indi

a

Chi

na

Braz

il

Ger

man

y

Aust

ralia

Irela

nd

Rus

sia

Pola

nd

Can

ada

Japa

n

Indo

nesi

a

Italy

Arge

ntin

a

UAE

Hon

g Ko

ng

Net

herla

nds

2012 Gap 9 7 4 7 11 1 8 6 6 4 13 8 7 6 14 8 2 7 8 3 10 13 6 13 10 14 152016 Gap 12 12 16 17 19 9 15 10 10 8 16 11 10 9 16 10 3 8 8 3 8 11 3 9 6 10 10

Swed

en

35

1210

8 87

4 4 43 3 3 3

2 21 1

0 0

-2 -2-3

-4 -4 -4-5

2 An Opportunity for Business

40%

50%

60%

70%

80%

90%

Sector Trends:Consumer Categories Rebound

Source: 2016 Edelman Trust Barometer Q45-429. Please indicate how much you trust businesses in each of the following industries to do what is right. Again, please 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) General Population, China.

*From 2012-2014, Pharma included as subsector(Q61f-65f). **From 2012-2015, Pharma included as an industry sector (Q43-60). 2012-2014 data recalibrated as a sector.

Trust in each industry sector, 2012 - 2016

2012 2013 2014 2015 2016

` Industry 2012 2013 2014 2015 20165 yr.

Trend

Technology 88% 88% 87% 84% 90% 2

Automotive 77% 82% 84% 78% 82% 5

Energy 74% 80% 78% 74% 82% 8

Consumer Packaged Goods 68% 76% 76% 72% 79% 11

Financial Service 72% 74% 76% 72% 76% 4

Telecommunications 72% 73% 76% 70% 76% 4

Pharmaceutical 56% 66% 66% 63% 71% 15

Food & Beverage 54% 60% 64% 62% 70% 16

General Population

10

Family Business in China: Big Trust Gap to Close

Source: 2016 Edelman Trust Barometer Q15-17C. Thinking about different types of businesses, please indicate how much you trust each type of business to do what is right using a nine-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) General Population, 28-country global total.

11

Trust in different types of business

52%

66%

46%

Global

59%54%52%

Asia Pacific

41%

72%

41%

Europe

52%

80%

47%

North America

57%

76%

40%

Latin America

Big Companies

Family-owned

State-owned

General Population

79%

59%73%

China

66 66 66 64 62 62 60 5956 54

47 4542

33 31 30 29

Can

ada

Swed

en

Switz

erla

nd

Ger

man

y

Aust

ralia

U.K

.

Japa

n

Net

herla

nds

U.S

.

Fran

ce

Italy

Spai

n

Sout

h Ko

rea

Chi

na

Bra

zil

Indi

a

Mex

ico

Developed Markets More Trusted

Source: 2016 Edelman Trust Barometer Q26-Q422. 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 nine-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) General Population, 25-country/area global total.

12

Trust in companies headquartered in each country, and percentagepoint change, 2012 vs. 2016

+6 -2 +6 +8 -2+1+1n/a+1+4+5+3 +2 +2 +1 0 +34 Year Trend

General Population

Business Must Lead to Solve Problems

Source: 2016 Edelman Trust Barometer Q249. Please indicate how much you agree or disagree with the following statement? (Top 4 Box, Agree). General Population, China, question asked of half the sample.

87% agree

“A company can take specific actions that both increase profits and improve the economic and social conditions in the community where it operates.”

up from 78% in 2015

General Population

13

Access to education/training

Address income inequality

Access to healthcare

Protecting/improving the environment

Reducing poverty

Access to food/water/housing

Supporting human & civil rights

Modern infrastructure

E

E

P

H

F

Source: 2016 Edelman Trust Barometer Q561-573 Thinking about businesses in your country, how important is it that they play a role in solving each of the following societal issues? Please use a 9-point scale where one means that it is “not at all important” and nine means that it is “extremely important”. (Top 4 Box, Importance) General Population, 28-country/area global total, question asked of one quarter the sample.

Societal Expectations Vary

14

Most important issue for business to address in each country/area

Canada

Brazil

GermanyFrance

ChinaU.S.

Poland

Argentina

Sweden

Mexico

U.K.IrelandNetherlands

Turkey

Singapore

Hong Kong

MalaysiaColombia

Japan

Australia

Russia

S. KoreaItaly

Spain

Indonesia

U.A.E.

South Africa

India

General Population

R

I

IE

E

R

H

E

EE

EE

P

P

E

H

P

E

H

H

H

E

E

E

E

E

P

I

H

E

I

Integrity 51% 30% 21

Engagement 49% 30% 19

Products 47% 33% 14

Purpose 44% 29% 15

Operations 42% 29% 13

Companies seen as underperforming

Source: 2016 Edelman Trust Barometer Q80-95 How important is each of the following attributes to building your TRUST in a company? Use a 9-point scale where one means that attribute 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, Importance) Q114-129 Please rate businesses in general on how well you think they are performing on each of the following attributes. Use a 9-point scale where one means they are "performing extremely poorly" and nine means they are "performing extremely well". (Top 2 Box, Performance) General Population, China.

Company Importance vs. Performance%

Importance%

Performance Gap

General Population

15

Integrity 51% 30% 21Has Ethical Business Practices 54% 30% 24Takes Responsible Actions To Address An Issue Or A Crisis 50% 32% 18

Has Transparent And Open Business Practices 48% 28% 20

Engagement 49% 30% 19Treats Employees Well 49% 32% 17Listens To Customer Needs And Feedback 51% 32% 19Places Customers Ahead Of Profits 50% 29% 21Communicates Frequently And Honestly On The State Of Its Business 47% 29% 18Products 47% 33% 14Offers High Quality Products Or Services 55% 34% 21Is An Innovator Of New Products, Services Or Ideas 40% 32% 8Purpose 44% 29% 15Works To Protect And Improve The Environment 50% 28% 22Creates Programs That Positively Impact The Local Community 44% 30% 14Addresses Society's Needs In Its Everyday Business 44% 31% 13Partners With NGOs, Government And Third Parties To Address Societal Issues 37% 28% 9Operations 42% 29% 13Has Highly-Regarded And Widely Admired Top Leadership 41% 28% 13Ranks On A Global List Of Top Companies, Such As Best To Work For Or Most Admired 42% 29% 13Delivers Consistent Financial Returns To Investors 42% 29% 13

Companies seen as underperforming

Source: 2016 Edelman Trust Barometer Q80-95 How important is each of the following attributes to building your TRUST in a company? Use a 9-point scale where one means that attribute 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, Importance) Q114-129 Please rate businesses in general on how well you think they are performing on each of the following attributes. Use a 9-point scale where one means they are "performing extremely poorly" and nine means they are "performing extremely well". (Top 2 Box, Performance) General Population, China.

Company Importance vs. Performance%

Importance%

Performance Gap

General Population

16

3 The Evolving Roleof the CEO

Building Trust Through Credible Influences

18

Actions

ValuesEmployeeAdvocacy

EngagementTrust

ActionsThe Evolving Role of the CEO:

CEO Focus Misplaced

Source: 2016 Edelman Trust Barometer Q451-461. Thinking about CEOs, how strongly do you agree or disagree with the following statements? [‘CEOs do too much lobbying,’ ‘Given that the average tenure of CEOs is just 4 years, CEOs aren’t in their role long enough to make a positive impact,’ (Top 4 Box, Agree) ‘CEOs are too focused on short-term financial results,’ ‘CEOs can be trust to create jobs’] (Bot 5 Box, Do not agree) General Population, China.

20

Percent who agree with each statement about CEOs

Focus on short-term financial results

Government relations

Too Much

74%

74%

Not Enough

Deliver high quality products and services

87%

Positive long-term impact

71%

General Population

Purpose and Profits Matter

Source: 2016 Edelman Trust Barometer Q496-506. How visible do you think a CEO should personally be in these different types of business situations? Please use a 9-point scale where one means that it is “not visible at all” and nine means that it is “extremely visible”. (Top 4 Box, Visible) General Population, China, question asked of half the sample.

21

Percent who agree that CEOs should be personally visible in discussing…

85%Societal Issues

‣ Income inequality‣ Public policy discussions‣ Personal views on

societal issues

81%Financial Results

General Population

ValuesThe Evolving Role of the CEO:

80%

85%

88%88%

Their education and how it shaped them

Their personal success story

The obstacles they have overcome

Their personal values

Personal Values and History Matter

Source: 2016 Edelman Trust Barometer Q507-514. Thinking about how a CEO communicates with a variety of groups and individuals, how important are each of the following activities a CEO could engage in? Please use a 9-point scale where one means that attribute is “not at all important to building your trust” and nine means it is “extremely important to building your trust”. (Top 4 Box, Important) General Population, 28-country global total, question asked of half the sample. [Media Engagement net = Q507 ‘Interviews with the media,’ and ‘Q512 ‘Sharing their views on a blog or on social media.’ Direct Engagement net = Q508 ‘Communications with employees,’ and ‘Participation in industry conferences.’] Q516-524. For you to trust a CEO, how important is it that you have information on each of the following aspects of the CEO’s personal life outside of their business? Please use a 9-point scale where one means that attribute is “not at all important to building your trust” and nine means it is “extremely important to building your trust. (Top 4 Box, Important) General Population, China, question asked of half the sample.

Percent who agree that each type of information is important in building trust in a CEO

General Population

23

Desired Leadership QualitiesCharacteristics that make a CEO trustworthy, percent who selected each as one of the top 5 in China

24

General Population

Source: 2016 Edelman Trust Barometer Q515. Which of the following personal characteristics make a CEO trustworthy? Please select the 5 most important characteristics that make a CEO trustworthy. General Population, 28-country global total, question asked of half the sample.

* Source: 2016 Edelman Trust Barometer CEO Supplement Q1. Thinking about company CEOs in general, how many CEOs could you name in full? General Population, 10-country global total.

40

35

30

27

26

Visionary

Innovative

Decisive

Experienced

Authentic

EmployeeAdvocacy

The Inversion of Influence:

Company NOT engaged in societal issues

Company engaged in societal issues

Employee Advocacy Increases With Societal Issue Engagement

Source: 2016 Edelman Trust Barometer Q527-529. Does your company and your company’s CEO get involved in addressing broader societal issues beyond the core business, through programs or relationships with other companies? Q530-536. Thinking about your current company, please indicate how much you agree with each of the following statements using a 9-point scale where one means that you “strongly disagree” and nine means that you “strongly agree”. (Top 4 Box, Agree) General Population, China, question asked of half the sample. 26

Percent who agree with each statement, comparing those who work at companies/for CEOs involved in addressing broader societal issues vs. those who do not

62

65

67

68

67

77

86

Recommend company as an employer

Stay working for the company

Confidence in the future of the company

Motivated to perform

Recommend products and services to others

Committed to achieving our strategy

Do the best possible job for the customer

Impact of Company

Engagement

8

14

24

22

22

24

23

94

91

91

90

89

89

85

General Population

EngagementThe Inversion of Influence:

59 58

49

43

52

45

39 38 40

6966

6057 57

54

46 45 44

CEOs Receive Largest Increase as Most Credible Spokesperson

Source: 2016 Edelman. Trust Barometer Q130-587. Below is a list of people. In general, when forming an opinion of a company, if you heard information about a company from each person, how credible would the information be—extremely credible, very credible, somewhat credible, or not credible at all? (Top 2 Box, Very/Extremely Credible) General Population, China, question asked of half the sample.

28

Percent who rate each spokesperson as extremely/very credible 2015 2016

+14

Technical Expert

Academic Expert

A person like

yourself

Financial Industry Analyst

EmployeeCEO NGO representative

Board of Directors

Government official/regul

ator

General Population

77 78

75 70

76

73 7370

60

7269 67 68

60

69

75 75 76

69

75

64

5856

52

64

2012 2013 2014 2015 2016

Integrated Media Landscape

Source: 2016 Edelman Trust Barometer Q178-182. When looking for general news and information, how much would you trust each type of source for general news and information? Please use a nine-point scale where one means that you “do not trust it at all” and nine means that you “trust it a great deal.” (Top 4 Box, Trust) General Population and Millennials, China, question asked of half the sample.

Trust in each source for general news and information

*From 2012-2015, we included Online Search Engines as a media type. In 2016, we changed to Search Engines.**From 2012-2015, we included Hybrid as a media type. In 2016, we changed this over to Online-Only.

Millennialseven more trusting of digital media thangeneral population

Industry Millenials Gap

Traditional Media 76% 0

Search Engines* 79% 4

Online-only Media** 75% 3

Social media 75% 6

Owned media 69% 5

General Population

72

70

68

50

42

41

Social

TV

Search

Newspapers

Magazines

Blogs

Power of Peer-Driven Media

Source: 2016 Edelman Trust Barometer - How often do you read, view, click on or engage with the following types of content, media or information sources? Online search engines, such as Google… (Q285), Television news and information (Q287), Social networking sites, such as Facebook, LinkedIn, Instagram, Twitter, etc.(Net of Q278 Social Networking, Q279 Blogs, Q289 Online message boards, forums or newsgroups), articles in printed newspapers (Q284), articles in printed magazines(Q283), Blogs (Q279) (Several times a week+) General Population, China, question asked of half the sample. 30

Percent who use each media source several times a week or more

General Population

2 of top 3 most-used sources of news and information are peer-

influenced media

31

4 Trust Impact

79

67

61

57

46

41

58

49

47

29

31

24

Trust Matters

Source: 2016 Edelman Trust Barometer Q371-589. Thinking back over the past 12 months, have you taken any of the following actions in relation to companies that you trust? Please answer yes or no to each action. General Population, China, question asked of half the sample. Q377-380. Still thinking about the past 12 months, have you taken any of the following actions in relation to companies that you do not trust? Please answer yes or no to each action. General Population, China, question asked of half the sample. 32

Percent who engage in each behavior based on trust

Behaviors for Distrusted Companies Behaviors for Trusted Companies

Refused to buy products/services

Criticized companies

Shared negative opinions

Paid more than wanted

Sold shares

Disagreed with others

Chose to buy products/services

Recommended them to a friend/colleague

Shared positive opinions online

Paid more

Bought shares

Defended company

General Population

Influence

The Inversion of Influence

33

Influence& Authority

Authority

Old Model

‣ Elites have access to more/better information

‣ Elites’ interests interconnected with those of mass

‣ Becoming an “elite” open to all

New Reality

‣ Peer-to-peer influence more powerful than top-down

‣ Increasing distrust among mass population

‣ Mass movements based on dissatisfaction and urgency

The Divide

‣ Democratization of information and more information

‣ High-profile revelations of greed and misbehavior

‣ Income inequality

Embracing the New Reality of Influence to Build Trust Through CreditableInfluences

34

‣ Create societal impact in addition to profits through purposeful action

‣ Express your values through honest, ethical engagement in which you share your story

‣ Ignite your most powerful advocate, your employees

‣ Engage cross channel to meet stakeholders, where they are, about what most interests/concerns them

Actions

ValuesEmployeeAdvocacy

Engagement

Influence

AuthorityLeadership

TRUST

Thank You