A view of the City of London, from the far side of the River Thames. Photograph: Getty Images.
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A lack of trust: addressing the "trust deficit" facing UK businesses

Trust in banks and businesses has was severely hampered by the financial crisis - and has yet to recover. The mistrust cuts both ways. How can we expect a recovery without support for business from politicians and the public?

The financial crisis that seized the developed world in 2008, sending shock waves through markets and plunging the world into a prolonged recession, did more than wreak socio-economic havoc: it significantly eroded trust between politics, business and the media. By inference, the public’s trust of politics, business and the media has been negatively impacted and a series of scandals involving each of these key pillars of society has enforced this sense of mistrust and created schisms between these institutions, driving a rift between them and the public. The importance of trust cannot be underestimated: it is an essential component of a flourishing democracy and economy. Without trust, investment is severely hampered and growth is strangled before even the "green shoots" appear. The dearth of trust is one of the major issues facing society today.

A recent research report conducted by Populus, commissioned by DLA Piper, has found that multiple trust "deficits" exist in our society. Moreover, the lack of trust between the three aforementioned "estates" is not only deeper now than back in 2011, when the inaugural Trust report was published, but it is wider too, with diverging ideologies splitting political parties, the phone hacking scandal afflicting the fourth estate, and the manifold recent negative stories stemming from the business community, particular from the financial services and energy sectors, appear to have tainted the reputation of all private enterprise. It is clear that trust between business, politics and the media has now broken down completely.

"Trust in business" remains at the forefront of the political agenda. Westminster remains committed to addressing what is perceived to be widespread malpractice among businesses - from energy firms hiking prices to PPI mis-selling – all to the detriment of the consumer. There is a view that non-financial services businesses are increasingly resenting being tarnished by the same brush the media and politicians have used to smear the reputation of banks over the past few years. Businesses have not necessarily addressed this negative perception in a particularly proactive manner. While there is acknowledgement that the financial crisis has been a torrid time for businesses, there is little sign that corporate behaviour is changing in any meaningful way. In other words, it’s business as usual for most businesses, who do not see themselves as the source of the "trust deficit" problem. With one influential media commentator opining that there should be a "bankers wing" at Ford Open Prison, the lack of awareness shown by some businesses is pretty surprising.

While public outrage, manifested through politicians, media and populist movements, being directed at certain business malpractices is understandable, it has led to an unhealthy overarching anti-business mood, which is hampering a sustainable recovery in the UK. This lack of trust cuts both ways. If businesses are viewed by the majority of politicians with deep scepticism then the feeling is mutual, with a growing sense in the business community that politicians and the media simply do not understand capitalism. This is particularly the case with politicians, who can be viewed as being devoid of business experience and accused of drawing ill-informed and uphelpful conclusions, which has hampered UK growth and the international reputation of UK plc. As a corollary to this, political messages are seen by business and the media as being opaque and often contradictory.

What can businesses do to address this trust deficit? A good start would be to make more noise about the myriad ways in which British businesses should speak out more and deliver positive messages which show that they are a force for good. It is clear that businesses expect industry organisations such as the IoD and the CBI to do more in this regard, but businesses themselves should also be promoting the virtue of capitalism and the benefits it brings. Schools have a role to play in explaining the value of commercial activity and countering any cultural problem with success. Business needs to re-evaluate its social responsibility and pro bono activity accordingly. Only through a concerted effort involving all stakeholders can this critical issue be addressed and, through exploring the areas where trust has broken down, solutions for the long term formulated.

Co-CEO of DLA Piper

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David Cameron's speech: a hymn to liberalism from a liberated PM

The Prime Minister spoke with the confidence of a man who finally has a full mandate for his approach. 

At every one of his previous nine Conservative conference speeches, David Cameron has had to confront the doubters. Those Tories who rejected his modernisation of the party from the start. Those who judged it to have failed when he fell short of a majority in 2010. Those, including many in his own party, who doubted that he could improve on this performance in 2015. Today, rather than confronting the doubters, he was able to greet the grateful. As the first majority Conservative prime minister for 18 years, he rightly savoured his moment. "Why did all the pollsters and pundits get it so wrong?" he asked. "Because, fundamentally, they didn't understand the people who make up our country. The vast majority of people aren't obsessives, arguing at the extremes of the debate. Let me put it as simply as I can: Britain and Twitter are not the same thing." Labour should pin that line to its profile. 

With a full mandate for his approach, Cameron went on to deliver his most unashamedly liberal speech to date. Early on in his address, he spoke with pride of how "social justice, equality for gay people, tackling climate change, and helping the world's poorest" were now "at the centre of the Conservative Party's mission". A lengthy section on diversity, lamenting how "people with white-sounding names are nearly twice as likely to get call backs for jobs than people with ethnic-sounding names", was greeted with a standing ovation. Proof, if needed, of how Cameron has changed his party beyond recognition. The former special adviser to Michael Howard, who avowed that "prison works", told his audience that prison too often did not. "The system is still not working ... We have got to get away from the sterile lock-em-up or let-em-out debate, and get smart about this." From now on, he declared, the system, would "treat their [prisoners'] problems, educate them, put them to work." 

There were, of course, oversights and lacuna. Cameron reaffirmed his commitment to a budget surplus but glossed over the unprecedented, and many believe undeliverable, that will be required to achieve it (and which may fail to do so). He hailed the new "national living wage" with no mention of the tax credit cuts that will leave the same "strivers" worse off. His "affordable" starter homes will be unaffordable for average-earning families in 58 per cent of local areas. But it is a mark of Cameron's political abilities that it was easy to forget much of this as he spoke. Like George Osborne, he deftly appropriated the language of the left ("social justice", "opportunity", "diversity", "equality") to describe the policies of the right. Cameron is on a mission to claim ownership of almost every concept associated with Labour. The opposition should not sleep easily as he does so. 

There was little mention of Labour in the speech, and no mention of Jeremy Corbyn by name. But when the attack came, it was ruthlessly delivered. "Thousands of words have been delivered about the new Labour leader. But you only really need to know one thing: he thinks the death of Osama bin Laden was a 'tragedy'". The description of Corbyn as the "new Labour leader" shows the Tories' ambition to permanently contaminate the party, rather than merely the man.

There are plenty of potential landmines ahead for Cameron. The comically lukewarm applause for his defence of EU membership was a reminder of how divided his party is on this issue. But today, he spoke as a man liberated. Liberated by winning a majority. Liberated by not having to fight an election again. Like a second-term US president, he was able to speak of how he was entering "the second half of my time in this job". Tributes to Osborne (the "Iron Chancellor) and Boris Johnson (greeted with a remarkable standing ovation) alluded to the contest to come. But whoever succeeds him can be confident of assuming a party in good health - and more at ease with the modern world than many ever thought possible. 

George Eaton is political editor of the New Statesman.