Bill McDermott, the CEO of SAP is making the news…for all the right reasons. Bill believes that trust is the ULTIMATE career weapon, and unlike most of his colleagues Bill is willing to talk about it.
I recently wrote two articles, the first called CEOs “Suck” at Trust and the second, Trust, Governance & Howard Schultz.
Howard recently released a very short video describing the future of corporations and their trust imperative. The CEO of Starbucks has been talking about trust as a business imperative for many years, and in my own small way, I have rewarded him by being a long-term shareholder.
At this point, you may be saying to yourself, who cares what CEOs are saying about trust? For one, I do. Trust is simply the “secret sauce” in every relationship and every organization regardless of its size, industry or location. Trust is also the most overlooked business strategy, especially in public companies where we find a good percentage of CEOs paralyzed by Wall Street's short-term demands. This recent article written by Holly Gregory explains the push and pull of short-termism Corporate Governance Issues for 2015 . It's not a pretty picture.
The best companies remain those with a long-term stakeholder value perspective. They are not sacrificing profitability for trust, in fact, quite the opposite. The business case for trust has been made, and the most trustworthy leaders are handsomely rewarding their long-term shareholders. That's not to say there won't be short-term bumps in the road. See for yourself.
This is a long-term chart for (SAP).
Click on picture to enlarge
Source: Yahoo Finance
And this is the same chart for (SBUX).
Click on picture to enlarge
Source: Yahoo Finance
While investors remain wary of Wall Street and the stock market, long-term investing in trustworthy companies alleviates many of those sleepless nights and minimizes the risks inherent in the “old school” short-term quarterly earnings chase. It also creates a virtuous cycle of reward for those CEOs who make trust a top priority.
