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The world is failing to meet the unprecedented challenges of our time because it is ensnared in a vicious cycle of distrust. Four interlocking forces drive this cycle, thwarting progress on climate change, global pandemic management, racism and mounting tensions between China and the U.S. Left unchecked, the following four forces, evident in the 2022 ������Trust Barometer, will undermine institutions and further destabilize society:  

• Government-media distrust spiral. Two institutions people rely on for truth are doing a dangerous tango of short-term mutual advantage, with exaggeration and division to gain clicks and votes.
• Excessive reliance on business. Government failure has created an over-reliance on business to fill the void, a job that private enterprise was not designed to deliver.
• Mass-class divide. The global pandemic has widened the fissure that surfaced in the wake of the Great Recession. High-income earners have become more trusting of institutions, while lower-income earners remain wary.
• Failure of leadership. Classic societal leaders in government, the media and business have been discredited. Trust, once hierarchical, has become local and dispersed as people rely on my employer, my colleagues, my family. Coinciding with this upheaval is a collapse of trust within democracies and a trust surge within autocracies.

The media business model has become dependent on generating partisan outrage, while the political model has become dependent on exploiting it. Whatever short-term benefits either institution derives, it is a long-term catastrophe for society. Distrust is now society’s default emotion, with nearly 60 percent inclined to distrust.

Whatever short-term benefits either institution {government and media} derives, it is a long-term catastrophe for society. 

Government was the most trusted institution as recently as the May 2020 ������Trust Barometer: Spring Update, when the world sought leadership capable of tackling a global pandemic. Now, after the confused and bungled response, government is viewed as less competent than business by 53 points and less competent than NGOs by 44 points. People still want government to take on the big challenges, but only 4 in 10 say government can execute and get results. In a critical litmus test, respondents in developed democracies studied believe they will be worse off financially in five years.

There is a turning away from traditional news sources because of the perception of bias and fake news (76 percent). There is a stark partisan divide, particularly in the U.S., with a 31-point gap between Democrats (55 percent) and Republicans (24 percent) when it comes to trust in media. It is telling that "Communications from My Employer" is the most believable (65 percent) information source, eight points higher than mainstream media, with media 30 points behind businesses and 21 points behind NGOs on competence.

We thought there might be a limit to the purview of business on societal issues. But the Trust Barometer shows that, by an average five-to-one margin, respondents want business to play a bigger, not smaller, role on climate change, economic inequality, workforce reskilling and racial injustice. Every stakeholder group expects business to lean in—nearly 60 percent of consumers now buy brands based on beliefs while 6 in 10 employees choose a workplace based on shared values and expect their CEO to take a stand on societal issues. My Employer remains the most trusted of any institution (77 percent), with a corresponding expectation of CEOs to be the face of change.

The problem is that businesses are not always suited to these roles, especially in the absence of government setting the playing field. (For starters, business leaders are not elected.) This, in turn, has generated public blowback (for example, against social media companies) while provoking government intervention. In the meantime, fairness has risen to the top of global concerns, with 70 percent saying that the system is biased against regular people and more than half questioning the validity of capitalism itself.

Then comes the mass-class divide, which has become more acute with the impact of Covid-19. Among upper-income people, the pandemic actually increased trust in public institutions. The last two years have coincided with stunning financial returns, at least for those with investable assets. But the same cannot be said of those dependent on public services, like public schools; or those holding frontline jobs, like service-industry workers; or those saddled with inadequate health care. With them, trust levels either plateaued or declined, in ways that correlate with socioeconomic class. The growing sense of being left behind is evinced in fears of job loss to automation and other forces (85 percent). 

The fourth force is the most worrisome. From globalization to deregulation of financial markets, leaders in democratic societies have made policy promises that have proven to be false, and the public has paid the price. Now, around two-thirds of respondents believe traditional authority figures—journalists, government leaders and business executives—flat-out lie. The ominous result: in many democracies, institutions are trusted by less than 50 percent of their people. The biggest losers are Germany (-7 points from a year prior), Australia (-6 points) and the U.S. (-5 points overall; -14 points for Republicans). The China-U.S. trust divide is now at a record 40 points (index score of 83 vs. 43 for trust in domestic institutions) though trust in Chinese companies outside their home market is at a record low (31 percent).

Facing these myriad challenges will require both a new way of operating and a much higher level of performance from our core institutions.

Facing these myriad challenges will require both a new way of operating and a much higher level of performance from our core institutions. Government must finally gain control over the pandemic on a global basis. The media needs to get back to a business model that replaces outrage with sobriety, clickbait with calm authority. NGOs have an invaluable role to play on climate change and the last mile on the pandemic.

Business must walk a tightrope. For now, business must accept the burden of filling the void left by government, but it should be poised to pivot to a more level playing field. CEOs will have to lead on policy and continue to be a model of long-term thinking for other institutions while avoiding political overreach.

One hundred years ago, John Maynard Keynes, in his Economic Consequences of the Peace, described the progress made in the years just before World War I through free trade and industrialization, “Society was working not for the small pleasures of today but for the future security and improvement of all, in fact for progress.” Keynes famously advocated government intervention to smooth out economic cycles. Today, business must be that stabilizing force, the institution delivering tangible action on wages, climate change, re-skilling and diversity. As business steps up, we need to move from outrage to optimism, fears to confidence, insinuation to fact. We must create a system that once again works for all.

Richard ������is CEO.