Repairing broken promises

The Volkswagen emission crisis has shaken confidence in one of the most recognised brands in the world: it also highlights the link between trust and economics.

 

All was still right with the world nine years ago when VW’s former chief executive officer Martin Winterkorn presented the new slogan of his automobile empire in the glossy context of the Frankfurt Motor Show – bursting with pride and with a broad grin on his face. “VW – das Auto” was a cool, dry and rational statement that underscored the powerful, dominant status of the Wolfsburg-based corporation. Buying a car from Wolfsburg suggested down-to-earth honesty and the absolute reliability of a product that many had come to believe in and even take for granted since childhood. The company was able to rely on a solid foundation of trust.

After all, business can only work based on trust: if you’re going to engage in business dealings with someone, you have to trust them. Customers have to trust a bank, for example, otherwise they would all rush to withdraw their money and the bank would collapse. In a globalised world with a surplus of products, trust in a brand acts as a guide that reduces complexity. Without this mechanism there would be no so-called “love brands”, no advertising industry and no marketing, either. And yet the trust factor tends to be left out of the economists’ equations.

The most severe crisis in VW’s history powerfully illustrates just how closely linked the variables of trust and economics are. Trust is in fact the most relevant factor of all when it comes to business relations.

Thorsten Hofmann

Professor Dr Thorsten Hofmann is a fellow of the Politics and Public Affairs MBA at Quadriga University of Applied Sciences in Berlin, Germany. He is also manager of the business consultancy Advice Partners and is chairman of both the Crisis Communication Task Force and of the communication network ECCO International Public Relations.