Financial services among least trusted industries

Banks, non-bank financial services and insurance are three of the bottom four rated industries for trust, according to the Roy Morgan Risk Monitor.

However, despite being part of the most distrusted industry of banking, ING and Bendigo Bank were in the top 20 most trusted brands.

Michele Levine, Roy Morgan chief executive, said for brands and businesses that experienced a rising level of distrust it can lead directly to customer churn, loss of market share, and a plummeting share price.

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“The example of AMP over the last three years is instructive as a once highly respected and trusted business has faced a series of scandals that has translated into a collapse in the share price from nearly $5.50 in early 2018 to only a smidge above $1 today – a share price drop of around 80%,” Levine said.

Levine said for this reason the Risk Monitor was not just a marketing or communications issue.

“It goes to the heart of corporate governance in an era in which a rumour can spread around the world in an instant via social media networks and do incalculable damage to a brand’s reputation – whether fairly or not,” Levine said.

“Distrust is a driver of consumer behaviour and should be on the risk register of every publicly listed company in Australia given the danger it can pose to a brand’s good reputation in the corporate realm – and also amongst existing and prospective customers.

“Our work has uncovered the scale of distrust that exists for many brands and businesses. It’s not uncertainty or even an absence of trust. It is something separate and more powerful, an active sense that we were foolish to trust too much, and it cannot be ignored.”

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None of us trust the big banks or AMP any more. But ALL of the research I have seen shows that Financial Advisors remain one of the most trusted categories of professionals, higher than accountants and solicitors even. Our clients know us and trust us, while we battle the big guys to protect their interests, and they (and the politicians) continue to try to point the finger of blame at hardworking advisers. Can't someone highlight THAT in an article? Enoughs enough guys!

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