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Building Trust: A fresh perspective on a critical business skills

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Direct contact with someone may not be as important in judging trustworthiness as was previously believed.

What made people trust Bernard Madoff? In the largest Ponzi scheme on record, thousands of investors in Madoff's funds lost billions of dollars. The fact that many of Madoff's friends and family members were among the investors may have helped him build trust with strangers, according to a recently published paper1, which finds that people can be won over by the names of someone's associates and the company he or she keeps.

This study's conclusions break with previous research on trust, which has identified the importance of incremental, evaluative processes — from snap judgments to relying on stereotypes to careful scrutiny — in forming initial impressions of someone. This paper finds that trust development can begin even before people meet or learn about one another's professional reputation or social status. Indeed, people can start trusting someone before they even realize it. To some degree, at least, the placing of trust is not the result of a deliberate assessment, the researchers say, but of subconscious cues.

In a series of three experiments involving more than 250 students, the researchers created a scenario similar to investment schemes — with the potential to either turn a profit or lose everything. The participants were first asked to list people they trusted or didn't trust and the reasons for their feelings. The researchers then primed the participants by flashing in their peripheral vision the names of those trusted or un-trusted associates, targeting an area of the brain that has been shown to process content without conscious awareness.

The students were then given US$5. They could send any portion of it, or none of it, to a stranger. They were told their "receiver" would get triple the amount they actually sent and would then decide how much of this profit to return. As with an investment scheme, the act of contributing money was risky but had the potential for shared gain. By measuring how much participants decided to invest after being primed either positively or negatively, the researchers found that people tended to send more money when influenced by the names of people they trusted. When asked to differentiate between people they liked and people they trusted, participants sent more money when primed by the names of those they trusted, suggesting that getting something back in return was an important factor in the trust-investment relationship.

In Madoff's case, victims may have subconsciously come to trust him because the names of his other investors — whether friends and family members or celebrities — encouraged them to believe in him as well. This conclusion is a warning to consumers and executives, who often search for recognizable names on client lists or professional associations when evaluating a potential partner or someone to do business with.

The researchers also point out that the changing nature of business, with increasingly fast-moving communications and travel, means that executives often have to build trust quickly among new co-workers and ever-forming teams. Given the importance of trust to organizational performance, the authors advise companies to employ visual cues — for example, project-related artwork or group photos — that might prompt thoughts of successful past relationships. Company events that bring potential partners together are also particularly useful, the paper concludes, because they form the basis of future name recognition and trust development.


Deciding whether to trust someone, especially with your money, all too often is a matter not of slow, deliberate evaluation but of subconscious impulse. Name recognition plays a vital role; people can form impressions of others before they even meet, based on the new person's associates and the company he or she keeps.

On reflection this all makes sense. Our gut reactions play such a vital role in judgement and mindful of the influence of the basal ganglia (risk) and amygdale (fear) have in our decision making process, these findings corroborate the importance of knowing how you think and make decisions, especially when it comes to trusting others.

Title: What's in a Name? Subliminally Activating Trusting Behavior

Authors: Li Huang and J. Keith Murnighan (Northwestern University)

Publisher: Organizational Behavior and Human Decision Processes, vol. 111,no. 1

Published: January 2011

Peter Buckley

I coach and develop individuals and businesses, in the private and public sector, Internationally and in the UK at board C-Suite and operational levels. Acknowledged outstanding results delivered through bespoke individual and team coaching, mentoring and leadership development to enable performance and productivity improvement with positive team dynamics and sustainable enhanced morale.

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