Building Trust in Business: Lessons from Leadership, Corporate Relations, and the Power of Social Capital
The Complexity of Trust in Business and Leadership
One of the most striking examples of trust in business is the $9 billion investment MUFJ made in Morgan Stanley during the height of the Great Financial Crisis. As Morgan Stanley hovered on the brink of collapse, MUFJ trusted them enough to make a major financial commitment. This wasn’t just about money; it was a testament to the years of relationship-building between the two companies.
What makes this example powerful is that MUFJ saw something in Morgan Stanley that went beyond numbers—something in their leadership, their culture, or perhaps even an intangible quality that made them worth saving. This level of trust is rare, almost akin to love, and it's something we’ll delve into during the Master Class.
Trust: Social Capital or Just a Buzzword?
My first encounter with the academic side of trust came from Francis Fukuyama, who discussed trust as a form of “social capital.” He made the distinction between high-trust countries, like Japan, and low-trust countries, like Italy. Japan, according to Fukuyama, is solid and unified like a slab of granite, while Italy is fragmented like a tray of sand. However, even this concept isn’t as straightforward as it seems.
Take Italy, for example. While its institutions might not inspire trust, personal relationships in the country are built on a strong foundation of trust—people rely on friends and family in ways they wouldn’t rely on the state. This contrast between formal and informal trust illustrates the complexity of the subject.
In business, this dynamic plays out frequently. While we may not trust systems or corporations, we often trust individuals within them.
The Nature of Trust: Personal vs. Corporate
Trust, at its simplest, is the belief that someone will act in your best interest. Yet, this belief is often complicated by the realities of self-interest, particularly in business settings. Personal trust and corporate trust are not the same.
In our daily lives, we trust friends and family because we know them personally. In corporate settings, trust becomes harder to define. Corporations are, by their very nature, driven to extract value, which can complicate trust. It’s not that corporations can’t be trusted—but the dynamics of trust in a business context are inherently different.
At The Delphi Network, we prioritize the building of personal relationships that can lay the groundwork for true trust. Trust between individuals leads to stronger, more effective business outcomes. This is the kind of trust we’ll explore further in the Master Class.
Building Trust in Business: Lessons from Morgan Stanley and MUFJ
One of the most powerful examples of trust in a corporate setting is the investment MUFJ made in Morgan Stanley during the 2008 financial crisis. As Morgan Stanley teetered on the edge of collapse, MUFJ made a $9 billion investment, securing a 10% stake in the bank. This wasn’t just a financial transaction—it was a testament to years of relationship-building between the two companies.
What’s particularly striking about this case is that MUFJ saw something in Morgan Stanley that went beyond the numbers. Whether it was the leadership, the people, or even the culture, MUFJ decided Morgan Stanley was worth saving when everyone else was ready to let them fail. This rare level of trust is something akin to love—and it’s almost unheard of in the world of finance, let alone business at large.
Trust in Leadership: The Role of the CEO
When it comes to trust, leadership is key. CEOs are responsible not only for cultivating trust within their companies but also with external stakeholders. Trust doesn’t just happen—it must be built, nurtured, and maintained. The role of the CEO in building trust is particularly vital in times of crisis.
Take the Morgan Stanley-MUFJ relationship. That partnership didn’t materialize overnight—it was the result of years of leadership fostering trust on both sides. CEOs play a crucial role in ensuring that their companies are viewed as trustworthy, especially in high-stakes situations.
At our December 11th Master Class, we will explore how CEOs can actively build and maintain this level of trust with their teams and partners. In today’s ever-shifting business landscape, understanding how to foster trust might just save your business one day.
The Takeaway
Trust is complex. It’s not easily given, nor is it easily maintained. Yet, whether in personal relationships or business dealings, trust is one of the most valuable assets you can build.
Join us for our upcoming Master Class, where we will dive deep into the mechanisms of building trust and how it can be the lifeline your business or career might one day need.
