Trust in UK business improves but exec pay and tax avoidance need addressing

Trust in businesses to behave ethically has recoveed (slightly), according to survey from the Institute of Business Ethics (IBE).  However, tax avoidance and executive pay remain the top issues UK business needs to address.                                                            

The survey, published today, shows that the public’s general opinion about ethical business behaviour has improved.

Over half (52%) now say they consider that UK business behaves ethically, a slight recovery from last year’s dip (48%), but not yet back up to 2015 levels (59%).

The strength of negative opinion is also decreasing, with fewer people now saying that business behaves “not at all ethically” (down from 9% in 2012 to 5% in 2017). 

Philippa Foster Back, Director at the IBE

Philippa Foster Back, Director at the IBE, said: “Although these results are encouraging, this may be related to the scandals which have affected other institutions in society over the course of 2017.

“By contrast, business appears more responsible in the eyes of the public. The fact that corporate tax avoidance and executive pay remain the top public concerns is an example where business is still not doing enough to address ethical issues.”

Indeed, the top three issues that the public think business needs to address remain unchanged for a third consecutive year.

Tax avoidance has been one of the top two issues since it was first introduced in the survey in 2012, with 38% considering this an issue that needs to be addressed, down from 43% last year.

Philippa Foster Back said: “Tax is a difficult and complex issue, but it isn’t going away. This year the Paradise and Panama Papers have thrown this issue even more into the spotlight. Companies need to do more to address public concern and communicate the circumstances behind the tax positions they decide to take”

Top exec pay deals

Executive pay continues to be an issue, with 30% of the public thinking this still needs to be addressed (up from 28% last year).

“Although there has been some movement on this issue by companies, as past shareholder approved policies take effect, it will still take time to move the dial. Naturally the public perception is that the changes are not quick enough,” Foster Back said.

Exploitative labour and work-home balance for employees also remain concerns, but employees being able to speak up about wrong doing enters the top 5 with 17% raising this as an issue of concern.

Foster Back said: “Although we are seeing a rise in the number of companies providing channels for employees to raise concerns, companies still need to listen to what they are saying. If employees repeatedly speak up and don’t feel heard, they might stop talking. And that silence can be dangerous.”