KPMG: Post-pandemic challenge is maintaining trust in companies

As the corporate reporting season begins, a KPMG white paper has warned big business that its real challenge lies ahead.

KPMG chair Alison Kitchen: ‘Large businesses have demonstrated humanity.’ Picture: Aaron Francis

As Victoria prepares to enter stage four lockdowns and the corporate reporting season begins, a KPMG white paper has warned big business that its real challenge lies ahead.

In a white paper titled The Trust Continuum, KPMG chair Alison Kitchen and Professor Nicole Gillespie from the University of Queensland say the pandemic has restored trust in big business but the trick now is to maintain it.

“The pandemic required Australian business to connect with its core purpose and show its humanity. It’s a demand that has been seized,” the paper said.

“Just as trust ratings for federal and state leaders rose markedly in response to the early effective handling of the pandemic, similar trust gains can be expected for the humanity shown by big business,” the paper said.

The early gains have now revealed a new reality in which national unity has broken down, with state borders closed and Victoria about to re-enter stage four lockdowns while other states prepare to go back to “normal”.

The KPMG paper says: “This environment will provide us with the true test for big business: how to maintain the trust that is earned during this crisis.”

The way forward, according to Professor Gillespie, is for business to deliver on ability, integrity and humanity.

The paper says: “Businesses should be proud to make profits, to earn good returns for shareholders which in turn will enable them to attract and retain funds for ­investment to grow the economy, jobs and prosperity for all Australians and to meet the needs of ­customers.”

Ms Kitchen said COVID-19 showed business thought its biggest responsibility was to the health of its staff.

“Perceptions of ability — the capacity to deliver goods and services and meet goals and responsibilities — have long been positive in Australia,” the paper says.

“Perceptions of integrity — doing the right thing by adhering to commonly accepted ethical and moral principles — has had some serious body blows, especially those delivered by the royal commission into financial services.

“Perceptions of humanity — demonstrating genuine care for those affected by an organisation’s operations — has been the weak spot for most companies in recent years.”

It notes: “Survey after survey has indicated people don’t believe modern Australian corporations are genuinely interested in anything aside from profits at all cost.”

This perception, the paper argues, has changed during the pandemic because of the behaviour of the likes of Coles and Woolworths reworking schedules to help the aged and disabled and hiring 30,000 people to help clear backlogs.

The paper says the telecoms sector is “now supporting thousands of disadvantaged students and teachers with free internet access and hardware to assist online education. Large businesses have demonstrated humanity through their immediate efforts to protect the health and safety of their ­people.”

Banks have also worked with their most vulnerable customers, whose numbers are now much higher than in the past, the paper says.

Big business has shown “how scale can help businesses work cooperatively with government to reliably fulfil their societal purpose at times of heightened need”.

Ms Kitchen said the pandemic has also forced business to be agile, as office workers demand more flexible work arrangements.

The government had extended JobKeeper and the banks had extended loan deferrals, but at some point they would cease — and big business will be tested.

“A core way to show humanity and respect is to explain, transparently and honestly, how a decision was made and why it was decided to be the most fair and reasonable course of action,” the paper says.

“Following fair and consistent processes when making decisions that impact others is always important for trust, but particularly so when tough choices need to be made.

“For businesses genuinely interested in supporting the vulnerable, the first and most important part of the task is to really listen and understand their needs and situation. Only from there can actions and policies be formulated that authentically show genuine care and concern.”

Many companies had sacrificed short-term profitability in the interests of the long-term resilience of the overall economy.

“… These actions will distinguish between those who do, and don’t, really bake in the trust gains learned from the COVID-19 crisis,” the paper says.