Trust as an Equation The benefits of trust as a leadership bedrock, fostering open communication, emotional safety, and mental health, are well-documented, as Forbes contributor Kurline Altes describes. Trust enables one party to count on the other in reliable ways, and at its best, it reduces unnecessary friction and inefficiencies while enabling innovation. However, as Forbes writer Jon Michail describes, “Trust is hard to earn and easy to lose.” To understand how to cultivate and sustain trust, consider trust as an equation: Trust = Character * Competence * Commitment. Competence is table stakes. It is necessary but not sufficient for trust. In 2008, when my colleagues and I put “Leadership on Trial” to examine the leadership failures arising from the global financial crisis, we found that it was primarily failures of character, not competence, that contributed to the poor judgment that eroded trust in leaders, organizations, and systems of oversight. Research at the Ivey Business School brought into perspective that character and competence also need the commitment to lead. Many leaders are promoted based on competence but often lack the commitment to the leadership role. Instead, they are committed to the corner office, title, salary, or prestige, none of which instill trust. In the case of trust, it boils down to trusting someone’s judgment and associated actions. If they lack commitment, they may not be trusted to carry through, or they may be pursuing their own agenda. The components of trust are not simply additive. They amplify each other. For example, deficiencies in character coupled with strong competence and commitment take what could have been good about competence and commitment and amplify the poor judgment and misconduct, as was the case with Enron. Speaking with students at the Ivey Business School, Andy Fastow, the former Chief Financial Officer (CFO) at Enron, explained he was awarded CFO of the year and his prison card in the same year. The amplifying effect of weak character on strong competence and commitment explains why Warren Buffet warned that “if you hire somebody without integrity, you really want them to be dumb and lazy.” Because higher education and organizations are hard-wired around competence, I want to spotlight character, which is often misunderstood and overlooked. In a recent MIT Sloan article “Make Character Count in Hiring and Promotion” I noted that we tend to hire for competence and fire for character. It is time to bring character to the forefront. MORE FOR YOU Google Chrome Attack Warning—Stop Using Your Passwords ‘Severance’ Season 2 Finale Recap And Review: In The Windmills Of Your Mind NCAA March Madness: Less Than 1% Of Brackets Remain Perfect On First Day Of Tournament Understanding Trust as Character We trust people’s competence and their commitment to get the job done. If you’re having brain surgery, you want your surgeon to be well-trained. You want your lawyer to understand the law. However, consider that if your surgeon or lawyer has weak humility, their judgment can be compromised. I have taught strategy in our business school for 40 years and fully grasp that deficiencies in strategic competence can be lethal for organizations. However, failures of strategy are often rooted in character-based judgment, as I described in the Forbes article I wrote - “Lessons from Boeing – Elevating Character Alongside Competence.” Typically, competence is easy to recognize based on someone’s skill set or experience. To understand character, you need to understand its components. Think about character as a wheel where all the spokes lead to a center point – judgment. Ultimately, when it comes to character, we are trusting judgment or what Aristotle described as “practical wisdom,” whether that be our own or someone else. Judgment relies on other dimensions of character around the wheel that are also inter-connected, some of which we may have in abundance and others not so much. And that’s the problem. Imbalances in character, like a wheel that is not balanced, lead to all sorts of issues, but one is lack of judgment and erosion of trust. Consider the 10 dimensions supporting judgment – courage, transcendence, drive, collaboration, humanity, humility, integrity, temperance, accountability, and justice – each with specific behaviors that can be observed and developed. It is relatively easy to see why a weakness in any dimension would undermine trust. Will a person have the courage to speak up? Will they have the humility not to let their ego get in the way? Will they have the patience to “not shoot the messenger”? Will they have the justice and accountability to understand and stand up for something beyond their self-interest? These questions and doubt undermine trust. Observing Character Trust isn’t necessarily about bad people doing bad things. It can simply be about not trusting that a person will have the courage to step up to a challenging issue, that they have the humanity and its associated empathy and compassion to understand our point of view and be treated with respect, or the humility to be vulnerable and admit mistakes, for example. I felt compelled to write this article because there are so many examples in the public domain of observable behaviors that don’t stand up to the test of strong and balanced character, thereby undermining trust. For instance, trust will be eroded when a person demonstrates a lack of temperance, which manifests as being agitated, impatient, inattentive, rash, and anxious instead of being composed, patient, prudent, self-controlled, and calm. When a person lacks humility, the deficiency will show up as being a braggart and disrespectful. It would be a mistake to equate any of these behaviors as a matter of style, negotiation tactic, or how business is done. Deficiencies in character erode trust and compromise judgment, which was a core finding from the Leadership on Trial study. We can observe character in ourselves and others. Few people see themselves as untrustworthy because we judge ourselves based on our intentions, while we judge others based on their observable behavior. If we reverse that and begin to see ourselves through the eyes of others, we may learn that what we thought might have been a virtuous behavior is actually operating like a vice. So, the person who is incredibly open-minded and flexible (behaviors associated with collaboration) can operate in a vice state of appearing “wishy-washy” when what they stand for can’t be readily observed because they haven’t cultivated equal strength in justice, accountability, and integrity, for example. Although we can use character to understand and observe trust, we can also use it to become trustworthy. Becoming Trustworthy The pathway to becoming trustworthy is about strengthening competence, which is often the primary focus of training and development. Although character has been neglected, there is evidence-based guidance on how to develop it. For example, research at the Ivey Business School reveals that temperance (being calm, composed, patient, prudent, and self-controlled) is one of the weakest character dimensions for many people. When those behaviors are weak, they compromise our ability to access all the other dimensions. You may have heard of the amygdala hijack, which explains how we can be triggered by fight/flight responses that undermine character. Think about a time when you weren’t your “best self,” and you can likely boil it down to a lack of temperance. As with all the character behaviors, there are exercises to strengthen them. It turns out that being calm can be considerably strengthened through breathwork, for example. So, if you have time to breathe, you have time to develop your character. My “Cracking the Code” article with Corey Crossan and Bill Furlong provides helpful resources. Cultivating Character-Based Trust Character doesn’t just reside in the individual. Character has a contagion effect – for better and worse. Consider how some people bring out the best in you, and others continually undermine you. Unpack what is happening, and most often character is implicated. A person who has cultivated a lot of transcendence – being appreciative, creative, future-oriented, inspired, optimistic, and purposive – tends to operate in a way that activates many possibilities in both people and situations. This is also a dimension in short supply that can be easily eroded by people lacking transcendence – being unthankful, unimaginative, short-sighted, uninspired, pessimistic, and directionless. It is critical to cultivate the strength of character that serves you and stands up under the toxic pressure arising when others haven’t cultivated character. Without that strength, trust is eroded. We often use a clip from the movie Invictus to help observe, identify, and explain positive character contagion. In this scene, Nelson Mandela (played by Morgan Freeman) is speaking to the Sports Commission members, who have just made what they believe to be the courageous decision to get rid of the name and colors (green and gold) of the Springboks rugby team, which they conclude is a symbol of apartheid. Mandela wades in, and we witness character contagion. He says, “I believe you have made a decision with insufficient information and foresight. Let me tell you why.” He then describes his experience as a prisoner on Robben Island, which reveals many of his character dimensions but also shows how it activates the character dimensions in those around him, particularly humanity, humility, courage, temperance, and transcendence. He says, “Now is the time for compassion and restraint – I know all the things they denied us. But now is not the time for petty revenge. Now is the time to build our nation with every brick available to us, whether that brick comes wrapped in green and gold!” By activating their dimensions of character, they see a different path, offering them a different choice and, ultimately, a different decision when they decide to keep the name and colors of the Springboks. Becoming a Trusted Organization The Canadian Armed Forces (CAF) ethos is entitled “Trusted to Serve” and provides a great example of the trust equation. As described in that document: “Trust is built through a commitment to character and competence. Character requires the ability to consistently live by a set of defining values and principles that shape one’s conduct and judgment. Competence leads to the professional excellence needed to provide military advice and service that result in success, time and again. The benefits of trust are wide-ranging. Trust enables those in uniform to work together within a common purpose and intent, rather than prescriptive orders, and this fosters professional creativity while maximizing efficiency and success. Also, mutual trust between military members creates the cohesion necessary for teams to succeed in the face of adversity. Lastly, the institution’s trustworthiness allows the CAF greater flexibility in managing its affairs.” Having worked with the CAF, I have witnessed their dedication to elevating character alongside competence to foster the trust imagined in their ethos. Even though military organizations worldwide have prided themselves on understanding and developing character, they are beginning to recognize that they have over-weighted and under-weighted different character dimensions, which can compromise judgment and erode trust. Furthermore, there is an opportunity to bring a systematic and science-based approach to character development. The CAF has now trained over 50 subject matter experts who have committed to the 13-day Leader Character Practitioner Certification Program offered through the Ivey Business School. I designed the program to equip participants with a science-based and practical approach to cultivating awareness of what character is and why it matters, integrate character into development, and embed it in the organization, including human resources practices such as selection, performance management, promotion, and other areas such as transforming culture. Living up to CAF ethos requires investing in developing the strength of character of all its members. There is no shortcut. Every organization needs to cultivate trust with all its stakeholders; things go sideways fast without it. Consider Enron, Wells Fargo, Volkswagen, and Boeing, and we quickly see that failures of character-based judgment are not only costly to these organizations' reputations but also to the lives and well-being of those they were trusted to serve. In conclusion, trust is comprised of character, competence, and commitment. Addressing a neglected piece of the trust equation—character—is a robust way to understand, observe, develop, and cultivate trust in individuals and organizations. By elevating character alongside competence in organizations, we not only produce trust but reap the benefits of everything that goes along with it, including well-being and sustained excellence through character-based judgment. Follow me on LinkedIn. Editorial StandardsForbes Accolades