Even as Indian companies continue to expand their global footprint, a study has revealed that the trust of advanced economies in indigenous firms of the country has declined steeply since 2011.
The study, conducted by public relations firm Edelman, said global trust in Indian companies was down to 33 per cent in mid-2013 from 42 per cent in 2011. Germany and France are the developed markets that have the least trust in companies headquartered in India.
Moreover, while 83 per cent of respondents in India trust India-based multi-national corporations (MNCs), developed market trust in them stood at a mere 29 per cent, it found.
"While Indian companies enjoy high trust levels in India, low brand awareness of Indian companies and low recall value of Indian CEOs have contributed to a significant trust deficit in developed markets," CEO of Edelman South Asia, Middle East & Africa Robert Holdheim said on the findings.
Our analysis also reveals that actions that drive trust in emerging economies are different from those in developed economies, he added.
According to the 2013 Emerging Markets Supplement, which focuses on the issues and opportunities facing BRIC-based MNCs, businesses headquartered in emerging markets are generally less trusted than their counterparts in developed markets.
Out of the emerging markets, Brazil is the most trusted in developed markets, followed by India, China and Russia, respectively.
The study attributed the low levels of trust in Chinese and Russian companies to the perception of them being state-controlled entities.
"Many in developed markets do not trust BRIC market governments and this greatly impacts trust in any organisation closely tied to them," David Brain, President and CEO of Edelman Asia Pacific, Middle East & Africa said.
Only four in ten developed market respondents said they would accept investment in their countries from companies based in BRIC countries, the study said.
Besides, 38 per cent of the respondents in developed markets said they would trust an Indian MNC to buy a company in their country.
Protection of customer data, respecting employee rights, quality control, responsible supply chain and protection of intellectual property are actions that can help address the challenge of low trust levels in developed markets,