Executive Summary: Trust Building
and Trust Busting
Steven D. Lydenberg’s article “Trust Building and Trust
Busting: Corporations, Government and
Responsibilities” appeared in the Autumn 2003 issue of the Journal of Corporate Citizenship.
“Talk in the press,” writes Mr. Lydenberg, “is often of restoring trust in the corporate
community. It is more accurate, however, to speak of creating such trust — a far more difficult task.” To do so, he
argues, requires an increased role for government in promoting corporate
citizenship and socially responsible investing. Three crucial elements are
needed: data, debate, and consequences.
Governments must consider whether to require the disclosure
of data on corporate citizenship, what the format and quantity of such data
should be, and who will pay the cost of providing it. Governments should create
a climate for informed and trustworthy debate by democratizing the structures
of corporate governance, demystifying the vocabulary of corporations and
financial institutions, and funding research. Finally, governments should
encourage a fair system of rewards and punishments that addresses the problems
of level playing fields and free-riders and that ensures that corporations are
not hindered from continuing to innovate and to generate wealth.
Read the full Paper.
