A16

Tomorrow Takes

trust

73%

Customer loyalty

How trust benefits your business

Q: To what extent does building trust in your company, internally and externally, help improve the following? (Response to ‘A lot’) Source: PwC Trust in US Business Survey, Sept. 16, 2021: base of 503 business executives

—MOHAMED KANDE VICE CHAIR, CONSULTING SOLUTIONS CO-LEADER AND GLOBAL ADVISORY LEADER, PwC US

“Each leader in an organization is likely to work with stakeholders with varying definitions and expectations of trust. It is important that leaders consider those different perspectives as they seek to establish and foster trust.”

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58%

Positive reputation

56%

Expanding into new areas/markets

57%

Revenue growth

52%

Employee recruiting/retention

54%

Strong relationships with regulators/policymakers

54%

Brand equity/brand protection

55%

Growing customer base

48%

Strong analyst feedback

50%

Access to capital/financing

Rethinking silos

How C-suite collaboration can build trust in your organization

Silos often exist within the C-suite, dividing leaders into their respective areas of responsibility and inhibiting collaboration. But in a time of rapid change and disruption, working together is even more key to solving challenges that span the enterprise and society. Companies have worked hard to stay afloat in today’s volatile economy, reinventing business models to weather the storm and meet the needs of stakeholders while maintaining profitability. These new systems need a shared vision of the future from executive leadership to thrive—and for that they need trust. These two actions can feed each other: Trust strengthens collaboration, and the result of those efforts can further build trust both within and outside of your organization. A unified C-suite—one with executives who understand and value each member’s priorities—can more effectively create sustained outcomes that boost revenue and drive growth. PwC’s latest Pulse Survey looks at how executives see their businesses this year and how they’re prioritizing investments. The results reveal three ways to begin building C-suite collaboration and how this strategy can leverage the strengths of your people, harness the power of technology, and realize new growth opportunities. CHRO: Strengthen C-suite communication to address talent shortages From analyzing risks associated with the Great Resignation to developing predictive tools to stay ahead of staffing needs, everyone in the C-suite has a stake in today’s labor shortages. This explains why executives across the board (77%) said that hiring and retaining talent is their most critical growth driver. CHROs should take this collaborative opportunity to transform and future-proof the HR function. HR leaders can start by developing authentic relationships built on trust among C-suite executives and in the enterprise as a whole. Employees believe that increased communication and a clear purpose drive trust, and when they trust your company, they’re more likely to stick around. Creating a well-articulated purpose can be challenging with a range of executive agendas, so CHROs should lead an open conversation to get each C-suite member on the same page. Understanding how each function’s agenda ties to trust can further strengthen the company’s purpose and culture and make employees feel heard and valued. Leadership knows that retaining talent can only go so far, and they need to attract and entice sought-after employees who can lead new tech-driven strategies. According to the Pulse Survey, job seeker priorities are clear: They’re looking for competitive salaries and better benefits. And employers are listening: 62% of respondents are increasing compensation, and an additional 22% are considering increases. Equipped with an understanding of their peers’ concerns, the C-suite can be a united front with a plan in place to balance talent demands with profitability.

“There’s no secret sauce to building trust, but proactively communicating with stakeholders about what you’re doing to build trust—and backing those words with action—is a critical step. Every company has a story, and business leaders need to make sure that the story they are telling is authentic to the company’s actions, operations, and its culture; what we do as organizations isn’t just about numbers—it’s about people, the communities we serve, and making a lasting impact.”

—WES BRICKER VICE CHAIR - TRUST SOLUTIONS CO-LEADER, PwC US

Note: This article was created by PwC.

How should I handle metaverse governance and security? The metaverse right now doesn’t have a lot of governance rules. It also offers many new attack surfaces, including through virtual goggles—potentially causing traumatic experiences. New kinds of metaverse-specific crimes are emerging such as “pump and dump” non-fungible tokens (NFTs) and other fraudulent metaverse investments involving crypto tokens. For governance, get up to speed on decentralized autonomous organizations (DAOs) built on voluntarily, agreed-upon rules enforced by a computer program that runs on a blockchain. For cyber defense, consider security measures at the services level that accompanies your assets as they travel through the metaverse. Reassess vendors and partners to see that their platform providers and cybersecurity firms have updated their security playbooks for the metaverse. How can I trust digital identities in the metaverse? In the metaverse, people, assets, and organizations may own their digital identities, complete with data, history, and assets that they can use anywhere. This is different from today’s internet, where customers, assets, and employees generally have specific identities just for specific companies or a particular platform or application. This decentralization may make it harder for you to trust identities and protect your stakeholders. To boost trust, consider blockchain-based credentialization services and metaverse versions of multifactor authentication and multi-signature verifications. Software can help detect anomalies and impersonations. You may also want to join one of the coalitions developing digital identities to help ensure that they’ll meet your needs. At the same time, monitor other coalitions for opportunities to adapt their data governance and authentication strategies. How can I offer stakeholders a trusted metaverse experience? A privacy violation or attack could be intensified if suffered when immersed in a three-dimensional world. When your stakeholders enter your virtual spaces, they’ll be trusting you to protect them. Your brand could pay dearly if users experience aggression, extreme behavior, privacy violations, or misinformation within your metaverse environment. If you participate in metaverse environments like virtual storefronts or entertainment, consider new protocols and controls, including third-party oversight, as well as impartial content moderation teams to cut down on misinformation, harassment, and abuse. You may also need to adapt your privacy controls to a digital world that allows its users to do much more, and reveal much more, than on the internet today. How do I build trust for when no one is looking? Even after your customers or employees remove their virtual reality (VR) or extended reality (XR) headsets, smart contracts in the metaverse will keep enforcing agreements and trading assets. Digital products will remain on digital shelves, ready for other digital users to buy them. Virtual machines will keep producing virtual widgets. To make sure that your company’s virtual activities work as desired, rethink digital services, monitoring, and controls. Blockchain, when combined with artificial intelligence (A.I.), can in some cases automate the authentication of identity, assets, transactions, and contracts—helping maintain trust in ongoing metaverse activities. And independent teams, internal and external, may be used to audit both smart contract code and its underlying hardware and software infrastructure. Authors Frank Badalamenti Roberto Hernandez Vikram Panjwani Emmanuelle Rivet

Note: This article was created by PwC.

CIO: Align on digital strategy to boost value and empower employees Second to talent, 60% of executives cited digital transformation as a growth driver for their company. Among its many benefits, digital transformation can lead the way to more agility, supply chain resilience, and a smoother shift to investor-grade ESG reporting, all of which are key to building trust for executives, employees and consumers. While it’s a shared responsibility across the C-suite, CIOs should guide the way toward improved cloud and digital strategies. The quicker companies embrace this transformation, the more value they’ll likely draw from it. One challenge for CIOs, revealed in PwC’s Cloud Business Survey: conflicting areas of focus. CIOs and board members value innovation (39% and 23%, respectively), while CFOs and COOs prefer improved resilience (25% each). Aligning on strategy and developing a shared vision across the C-suite is the path to bring the most value to your business. Unfortunately, many companies that have invested in cloud and digital transformation have yet to see a return on investment. One of the top barriers is the growing digital talent divide. With a continued focus on employees, CIOs can leverage the skills of other technology leaders and CHROs to develop digital upskilling opportunities and a culture of lifelong learning. This proactive approach can help narrow the skills gap and empower your employees. An investment in people today can help companies stay ahead of tomorrow’s challenges—offering both the innovation and resilience desired by the CIO’s fellow C-suite members. CFO: Turn to your tax leaders to create new opportunities Digital transformation isn’t cheap, but it is necessary to avoid being left behind. This is where the CFO and tax leaders come into play. With the increasing complexity of today’s challenges, tax executives are taking a seat at the executive table to present data-driven solutions. The January Pulse Survey found that 42% of companies said tax will be central to their digital transformation efforts. Working together with CIOs and CFOs, tax leaders can help drive value by showing how R&D tax credits, state tax credits and incentives, and intellectual property management can be used to help offset some transformation costs. Precious dollars have been lost to a lack of collaboration among executive leadership in this area. Only 17% of CIOs who participated in the survey said they considered how tax strategies could be incorporated into the planning phase of their digital transformation projects, and a mere 13% considered tax throughout these projects. Companies have seen 8% to 20% cost reductions when using this strategy, but only 38% of CFOs say they’re very confident their company is taking advantage of R&D tax credits for cloud investments. This scenario presents room for collaborative growth in the C-suite. CFOs should push to reshape project planning and bring tax leaders in early so that they can take full advantage of cost-saving measures. They can then reinvest that money into strategies that focus on trust and further strengthen the company’s purpose. Breaking down barriers to build up your company Today’s biggest challenges touch all areas of the enterprise, and a disconnect between executive functions can lead to inefficiencies. As the tax strategy demonstrates, a fractured C-suite can miss out on simple solutions to a pervasive problem, whereas a unified C-suite, with a foundation in trust, can look to each member’s area of experience to quickly address issues and create new opportunities that drive growth. The Pulse Survey presents three ways companies can use trust alongside collaboration to stay ahead in these uncharted and challenging times.