Transparency and Trust Key to Strengthening SMEs in Mexico

Trust is one of the most important bonds and emotional needs we have as human beings. It is at the core of the ability of human beings to form relationships and partnerships. At this point, we are not only talking about personal relationships but also about the global economy, both with governments and large and small companies.

The functioning of the global economy is thanks to the certainty generated between companies, business partners and supply chains, facilitated by data, information, and technology. All this is supported by human talent within organizations.

The numbers are compelling. Employees in companies where trust is high report 106 percent more energy in the office, 74 percent lower stress levels, 76 percent more engagement, and 50 percent more productivity than their peers in companies where trust is low, according to research published in Harvard Business Review [1].

One of the most important drivers of the Mexican economy is the small and medium-sized enterprises (SMEs), which generate 72 percent of employment and more than 50 percent of Gross Domestic Product (GDP). Certainty and confidence in this sector are, therefore, crucial for the economic development of the country.

This leads us to two realities. The first is where trust permeates between companies and the most important stakeholders, and the second is when the lack of this value undermines relationships.

On the one hand, countries with high levels of transparency and trust have more productive economies and companies that are more likely to participate successfully in global supply chains. On the other hand, economies with lower levels of transparency and trust have lower competitiveness and higher costs associated with bureaucracy where firms are less likely to have access to bank loans, according to a study by the Inter-American Development Bank (IDB).

Mistrust in the society-business relationship has gained ground. In the last three decades, the number of people who have "little or no trust" in large companies has risen from 26 to 39 percent, according to the Gallup[2] consulting firm. This has its origins in the volatility that has characterized recent times, as well as the previously implicit "covenant breaking" between corporations and employees or employment and lifetime loyalty in exchange for a dignified life and retirement.

Numerically, how much does society's distrust of companies affect them? According to research by Accenture Strategy Global Consumer Pulse, a U.S. survey shows that 41 percent of consumers tend to change products because the manufacturer is not aligned with their values.

Building Bridges of Trust

Trust is a fundamental building block for societies, companies, and economies. The globalized and integrated world, which is evident in value chains, links millions of people from different cultures. One of the most important instruments for strengthening trust is the use of technology, which brings with it innovations that bring societies closer together and accelerate economic development[3].

Regardless of margin, SMEs are aware of the benefits that technology can bring to all aspects of their business. A report by Dun & Bradstreet in the United Kingdom indicates that 58 percent of respondents agree that technology can improve efficiency, 38 percent believe it increases the security of their company and customer data, and 37 percent anticipate that it can help their long-term savings.

A company can only reach its full potential when it has the right talent onboard. This explains why 37 percent of respondents say that recruitment is their priority in the coming years. Bringing onboard human talent that has beyond technical competence, learning skills, agility to change, emotional intelligence, and resilience is indispensable for the sustainable growth of any company.

A company, large or small, needs a combination of technology and talent to grow. With the right tools, it will be possible to generate links between business partners and suppliers, create product offerings, and develop services that will lead to new business opportunities.

Transparency builds trust, and technology facilitates such transparency. Openness in data and information can be used by others, such as investors, creditors, customers, suppliers, or partners, to help establish a company's credibility and visibility. Today, it is indispensable to be part of a new "ecosystem" of transparency and trust.

Going forward, the lessons the past few years have taught us are resilience and the ability to plan, execute, and correct in rapid cycles as the environment changes. With technology, transparency and data-driven decisions will continue to benefit risk management capabilities, working capital optimization, regulatory compliance, and in the end, the sustainable growth that any company needs.

[1] The Neuroscience of Trust, Harvard Business Review.

[2] Mistrust in America could sink the economy, The Economist.

[3] The cost of mistrust, OCDE.