Few concepts in business carry as much weight and as much mystery as trust. While often labeled as a “soft skill,” trust has hard consequences. It shapes productivity, innovation, retention, and even financial performance.
Yet in today’s workplace, trust feels more elusive than ever. Hybrid and remote work have altered how relationships are built. Economic headwinds have heightened job insecurity. Generational shifts have transformed what employees expect from employers.
Against this backdrop, fostering a genuine culture of trust isn’t simply about being nice—it’s a strategic imperative for organizations seeking resilience and sustainable growth. Join Sereda.ai as we explore this topic in detail!
What Does a Culture of Trust Mean?
A culture of trust is the collective confidence employees have in each other and the organization. It goes far beyond liking colleagues or believing leaders are competent. It means people:
- Feel safe sharing honest opinions, including dissenting views.
- Believe mistakes will be treated as learning opportunities, not punishable offenses.
- Trust that decisions are made transparently and fairly.
- Experience consistency between what leaders say and what they do.
Research confirms that trust is multidimensional. Harvard Business School professor Frances Frei frames trust as the combination of authenticity, logic, and empathy. If any one of these pillars wobbles, trust suffers.
This trust is not static; it must be continually nurtured. Even high-trust organizations can see trust deteriorate quickly if leadership actions contradict stated values.
Also read: Here’s How to Promote Employee Well-Being
The Grand Decline of Trust in the Workplace
Despite widespread acknowledgment of its importance, trust in the workplace has been under siege. Several converging trends help explain why.
The hybrid work dilemma
Remote and hybrid models have brought flexibility, but also distance. A 2023 Microsoft Work Trend Index found that 87% of employees feel productive working remotely, yet 85% of leaders struggle to trust that productivity is real. This “productivity paranoia” creates a subtle but pervasive climate of suspicion.
Economic instability and layoffs
Mass layoffs and restructuring have left scars. In 2023 alone, more than 260,000 tech workers were laid off globally, according to Layoffs.fyi. Even employees who stay may develop what researchers call “survivor’s guilt,” feeling anxious about their own future, and wary of employer loyalty.
Generational shifts
Younger generations are redefining trust. According to Deloitte’s 2024 Global Gen Z and Millennial Survey, nearly 50% of Gen Zs and millennials have rejected a job or assignment because it didn’t align with their values. They demand transparency, purpose, and authentic leadership in ways previous generations did not.
Polarization and social tensions
Broader societal polarization is leaking into workplace dynamics. Conversations once considered private, like political views or social justice stances, now affect how people perceive their colleagues and organizations. When mishandled, these issues can deepen divisions and erode psychological safety.
Also read: Why Workforce Risk Management Belongs at the Strategy Table
Why Is It Important?
The consequences of low trust extend far beyond interpersonal friction—they ripple through every dimension of organizational performance.
Financial performance
Companies with high-trust cultures outperform competitors financially. Research from Great Place to Work indicates that high-trust organizations outperform the stock market by 2-3 times. Trust fuels faster decision-making, higher engagement, and greater agility.
Engagement and retention
Gallup’s 2024 State of the Global Workplace found that only 23% of employees worldwide feel engaged at work, leaving a vast majority feeling disconnected. Trust in leadership plays a major role: teams with higher trust tend to see stronger engagement and lower turnover. When trust is lacking, employees are more likely to disengage or quietly look for other opportunities, driving both visible and hidden costs for organizations.
Innovation and speed
In low-trust environments, employees withhold ideas, fearing ridicule or punishment. High-trust cultures encourage experimentation. Google found that psychological safety—an outcome of trust—was the #1 predictor of high-performing teams.
Resilience in uncertainty
Trust acts as a stabilizer during crises. Organizations with high trust bounce back faster after setbacks. In times of rapid change, trust is the glue that helps teams stay focused rather than fracture under pressure.
Also read: Employee Morale: The Complete Guide from Insight to Action
How Leaders Can Create a Culture of Trust in the Workplace
While the data underscores the stakes, reliance doesn’t happen by accident. It requires intentional, sustained action across multiple fronts. Here’s how leaders can systematically build and protect a culture of trust:
Communicate with radical transparency
During uncertain times, silence creates space for anxiety and rumors to grow. To keep reliance strong, leaders should:
- Explain the “why,” not just the “what.” Don’t just announce decisions—share the reasoning and context behind them. This helps employees feel respected and reduces speculation.
- Share bad news promptly. When the organization faces challenges—such as financial pressures, restructuring, or strategic pivots—employees prefer to hear it directly, rather than through whispers. Even partial updates are better than silence.
- Admit when you don’t know. Leaders gain credibility by saying, “I don’t have the answer yet, but here’s what we’re doing to figure it out.”
Here, we recommend holding quarterly “Ask Me Anything” sessions where employees can submit anonymous questions. Publish summaries of both the questions and honest answers afterward to demonstrate follow-through.
Act consistently and fairly
Trust is built on a foundation of predictability. When leaders consistently align their actions with their words, employees gain clarity and confidence about where they stand. People pay close attention to the signals leaders send, noticing things like:
- Whether policies apply to everyone. Special treatment or exceptions erode faith in fairness.
- Whether promises are kept. Broken commitments—even small ones—chip away at trust.
- Whether leaders live by the values they promote. Hypocrisy undermines morale faster than any external threat.
Before rolling out a new policy or decision, ask yourself: “Would I apply this to myself or someone close to me?” If the answer is no, reconsider the decision.
Foster psychological safety
Psychological safety, a concept championed by Harvard professor Amy Edmondson, is essential for teams to learn, collaborate, and innovate effectively. At its core, it’s about creating an environment where employees can share different opinions, even those that go against the grain, and admit mistakes without worrying that it will damage their reputation.
So, how can leaders help cultivate this kind of environment?
- Normalize vulnerability. Share your own challenges and learning moments to show that imperfection is part of growth.
- Respond calmly to bad news. The way you react teaches employees whether it’s truly safe to be honest.
- Recognize courage. Publicly acknowledge those who voice constructive criticism or bring forward new ideas.
Even small actions can make a big difference. For instance, try starting meetings with a question like: “What assumptions might we be making that we should challenge today?” This signals openness to diverse perspectives and invites everyone to contribute.
Involve people in decision-making
Trust grows when employees feel they have a hand in shaping the organization’s future, rather than simply being on the receiving end of directives. This doesn’t mean that every decision has to be made by consensus, however, it means:
- Seek input early. Ask for feedback during the planning phase, not after decisions are made.
- Act on feedback—or explain why you can’t. Silence after collecting input breeds skepticism.
- Encourage shared ownership. Let teams help define success metrics or participate in solving challenges.
For example, after gathering feedback, share a summary titled “Here’s what we heard, here’s what we’re doing.” It closes the loop and builds credibility.
Invest in personal relationships
Relationships are the scaffolding on which trust is built. People don’t follow titles alone—they follow leaders who show genuine care and connection. Leaders build trust when they:
- Remember personal details. Recognizing birthdays, life events, or even hobbies shows genuine interest.
- Show empathy during tough times. A simple check-in when someone is struggling goes a long way.
- Listen actively. Don’t just hear—seek to understand.
These leaders often earn higher engagement and loyalty in return. So, try to schedule regular one-on-ones—not just to discuss work, but to understand employees’ career goals and challenges outside the job.
Use surveys as a tool for reliance
Surveys aren’t just tools for collecting data—they show that leaders want to hear what people think. But if handled poorly, they can damage trust instead of building it.
Good surveys:
- Guarantee anonymity. Employees must feel safe being honest.
- Share results transparently. Even tough feedback needs to be acknowledged.
- Lead to visible action. Nothing destroys trust faster than asking for opinions and doing nothing with them.
Modern tools like Sereda Surveys make this process easier. They offer customizable templates for engagement, eNPS, onboarding, and pulse checks, ensuring organizations collect targeted insights quickly and securely.
Also read: What a “Good” Survey Really Looks Like (and Why Most Don’t Work)
Conclusion
High-trust organizations move faster because people don’t waste energy second-guessing motives. They innovate more boldly because employees feel safe sharing new ideas, even controversial ones. And they navigate uncertainty with greater resilience because relationships—and confidence—run deeper than any single setback.
Yet the paradox remains: reliance takes years to build but can vanish in a single moment. Companies that invest in transparency, fairness, psychological safety, and authentic listening are the ones best positioned not just to survive change, but to use it as a competitive edge. The real question isn’t whether trust is worth the investment. It’s whether any organization can afford the cost of neglecting it.
Curious how you can strengthen trust across your team? Book a quick demo with us and see practical tools in action.