Why trust is a key trait of successful dealmaking

  • 7 Minute Read
  • December 04, 2023

John D. Potter

Deals Clients & Markets Leader, PwC US


Megan Conway

Managing Director, PwC US


Trust during dealmaking — especially when an organization’s future hangs in the balance in a transformational deal — is critical. What executives say and do during this time can lock in perceptions of them and the company’s culture and strategy. The stage for future success — or missed opportunity — hinges not just on whether or not to do a deal, but on the way executives navigate the balance between confidentiality and trust. Too often, confidentiality creates a bias in decision-making that hinders trust, transparency, and coalition building.

Dealmakers should start by thinking through how they can earn trust with critical stakeholders during each stage of the deal. They should seek to understand each group’s goals, values and underlying hopes, fears and needs. That deep understanding allows leaders to empathize, and then communicate and behave in ways that earn trust.

Here are some insights from PwC research and our frontline experience to help dealmakers build trust.


Deals can either create or erode value, and customer trust is a key variable in those outcomes. Customers care deeply about their own safety — including the security of the private information they entrust to companies — and about their customer experience.

PwC’s 2023 Trust Survey found that most executives believe their companies do “very well” on addressing issues that are most important to customers.

But as leaders assess deal opportunities, exchange information with their counterparts and then perform due diligence, it may be worthwhile to double check their assumptions.

Taking time to do a “trust audit” — collecting and evaluating objective information about trust and customer perceptions — can help dealmakers correctly value opportunities and develop better post-deal implementation processes and strategies.


Most companies will say that employees are one of their greatest assets. But trust can be eroded during dealmaking not only by the choices that are made but also in the way they are communicated — from the inclusion and exclusion of certain stakeholders to the timing and depth of transparency. Retaining and enhancing the trust between employees and leaders is often a core part of M&A value creation.

Executives say they are doing “very well” at delivering what employees say drives their trust in a company — such as fair pay and data protection. But, as with customers, there’s a significant disconnect between the level of employee trust and executive perception of that trust (a 14 point gap). This blindspot reveals there is room for growth in the ways businesses, and corporate leaders specifically, create trusted relationships with employees.

In the case of key employees, fair compensation and benefits, flexibility and opportunities for advancement can be major factors in retention. Employees in the acquired company want to be certain that the pay and benefits they receive will stay the same or improve. Leaders may need to navigate sensitivities around how workers in different business units are rewarded.

Diversity, equity and inclusion (DEI) are important considerations. Women and members of minority groups report they are less likely than their white male peers to trust corporate leaders. PwC research finds that workers who have positive perceptions of their company’s DEI practices are twice as likely to report trust in their leadership.

Employees may also hold the key to closing the trust gap within an organization. PwC’s Trust Survey found that among employees who say their companies have experienced a trust-damaging event in the previous year, 46% say they expected it. Through strong listening, leaders have an opportunity to discover trust crises before they hit, and respond proactively in ways that maintain employee trust.


Investors looking to place capital may have different views on what drives trust. For private entities considering M&A activity or an IPO, investor trust can be bolstered by quantitative data. Enterprise trust may take the form of consistent accounting and verified data that enables investors to provide capital with confidence.

For large institutions needing to meet fiduciary responsibilities and mandates, trust in deals goes far beyond balance sheets and five-year projections. What’s needed is evidence of enterprise trust that’s embedded throughout the organization. In addition to audited financials, institutional investors will seek innovative enterprise risk management and internal controls for reporting.

And with the large amount of international capital committed to sustainability investing, companies can earn trust by avoiding “greenwashing,” or standing up shaky claims to sustainability that are inaccurate. By providing verified reporting that shows environmental, social and governance (ESG) metrics have been met, they can open additional avenues for investment capital — especially among international investors.

While executives continue to rank investors as an important stakeholder, they say conflicting stakeholder priorities is one of the biggest challenges to earning trust. Demonstrating enterprise trust that earns credibility with investors — through accountability and transparency — can help drive value creation.


Companies have to navigate an increasingly complex regulatory environment, including proposed changes in Hart-Scott-Rodino Act reporting requirements and outbound investment rules. For corporate leaders, earning trust with federal and state regulators may mean proactively discussing innovation strategies or how to enter new markets with them.

Occasionally, new ideas and strategies might run into resistance from regulators who simply need more details about the impact of these innovations.

Research shows that the most successful M&A organizations start their planning earlier in the process than their peers. The same principle holds for earning and retaining trust.

With regulators, earning trust before it’s needed for a transaction is likely to ease the path forward. And indeed, earning trust with critical stakeholders builds a well of goodwill and confidence that can boost M&A returns.


Not all M&A stakeholders have mutually aligned interests. Being able to achieve “win-win” outcomes is a foundational tenet of the most effective dealmakers. While it may seem counterintuitive, developing a level of trust is a key ingredient to getting deals done when information asymmetry is at the heart of most negotiations.

Navigating the balance between confidentiality and transparency is even more tenuous in negotiations. But being willing to share information, or reveal elements of what you value, can unlock win-win opportunities that would otherwise be squandered. The same bias in decision-making that impacts executives within their organization can cripple negotiations with counterparties; awareness of these biases can create opportunities for executives to balance diverse stakeholder expectations, earn trust and reach a deal.

Consistency is a key element of building trust. Dealmakers likely will have fewer interactions with counterparties than with their colleagues inside the organization. As such, each interaction with a counterparty likely carries more weight in establishing trust. Put simply: There isn’t as much room for mistakes when trying to establish trust with counterparties.

Understanding trust

Harvard Business School Professor Sandra Sucher, who is a contributing subject matter expert to PwC’s Trust Leadership Institute, has identified four main elements of trust:

  • Competence: Is your organization competent? Can it innovate, produce and deliver what it says it will?
  • Motives: Are you motivated to serve the interests of others as well as your own? How can you balance competing stakeholder needs?
  • Means: Do you use fair means to achieve your goals? Consistent, ethical, precise and inclusive?
  • Impact: Do you take responsibility for the impacts you create, whether intended or unintended?

When organizations demonstrate these four qualities consistently across the business they’re better equipped to earn trust with key stakeholders — employees, the deal counterparty, regulators, investors and customers.

Success in dealmaking is heavily influenced by the way executives navigate the balance between confidentiality and trust. While executives don’t disclose everything they know to other stakeholders, what they do decide to share – whether internally or externally – should help earn trust.

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