Does Your Team Actually Trust You? The Question Most SME Leaders Never Think to Ask

There's a question most founders and MDs never put to themselves — not because it's uncomfortable, but because it doesn't occur to them. They're in the building every day. They know people's names, their kids' names, their coffee orders. Surely, trust isn't the problem?

Except the data suggests otherwise.

Research into Australian workplaces found that while most employers say they trust their employees, only just over half of employees say they trust their employer back . In large corporations, you might explain this away: the executive team is distant, communication is patchy, middle management creates friction. But in a business of ten, twenty, or thirty people — where the leader is visible, accessible, and often personally known — what explains the gap?

That's the question worth sitting with.

Leaders of small businesses tend to conflate *visibility* with *trust*. Being in the room, being approachable, having an open-door policy — these things feel like trust-building. And they are, up to a point. But trust isn't built by presence alone. It's built by a very specific set of behaviours, repeated consistently, over time .

What actually erodes trust — often without anyone saying anything — is the gap between what a leader says and what they do. The values on the wall that don't match the decision in the room. The feedback session where the leader listens but nothing changes. The hard conversation that never happens because it's easier to let things slide.

In small businesses, employees are watching all of this up close. They notice more, not less.

The Silence Problem

One of the clearest signs of a trust deficit isn't conflict — it's silence. When team members stop raising concerns, stop pushing back on decisions, stop offering ideas that might be unpopular, it often means they've learned that doing so carries a cost . Not necessarily a dramatic cost. Just a slightly cooler reception, a slightly dismissive response, a sense that the conversation never really landed anywhere.

Over time, people stop trying. They show up, do their work, and keep their real views private. The leader interprets this as harmony. It isn't.

This dynamic — silence as a form of conflict avoidance — is more common in Australian SMEs than most leaders recognise. And it's expensive. Businesses with high-trust cultures consistently outperform on retention, productivity, and willingness to innovate . The inverse is also true: low trust drives up turnover, slows decisions, and subtly shrinks the space in which good work can happen.

Trust in a small business is built through three things, applied consistently:

1. Alignment between word and action

If you say you value straight talk, you need to be able to receive it without defensiveness. If you say people's wellbeing matters, that belief needs to show up in how you respond when someone flags they're struggling. Inconsistency here is noticed immediately — and remembered far longer than you'd expect .

2. Decisions that are explained, not just announced

People don't need to agree with every decision you make. But they do need to understand the reasoning. Unexplained decisions — even good ones — create a vacuum that gets filled with speculation and, often, the least charitable interpretation available. In a team of fifteen, that speculation spreads fast .

3. Conversations that don't get avoided

This is perhaps the hardest one. Most leaders know which conversations they've been putting off — the performance issue that keeps getting another chance, the team dynamic that nobody's naming, the colleague whose behaviour is affecting morale. Avoiding these conversations is understandable. It's also costly. The team knows what's happening. Your avoidance tells them something about whether hard things will actually get addressed .

For founders especially, trust is complicated by authority. When you are the person who signs the leases and owns the equity, your team is always reading the room slightly differently to how you are. Power asymmetry shapes what people feel safe to say — even when you're not trying to make anyone feel unsafe.

This isn't a reason for despair. It's a reason for precision. Founders who build genuinely high-trust teams tend to be deliberate about creating specific moments where disagreement is welcome, where uncertainty is named rather than papered over, where the question "what am I missing?" is asked and genuinely meant .

These aren't grand gestures. They're small, repeated signals that slowly shift what people believe is possible in your organisation.

If you're not sure where you stand, that itself is useful information. Consider asking your team — not "do you trust me?" but something more tractable: *Is there anything you've been reluctant to raise with me? What makes it hard to bring up difficult topics here?*

The answers will tell you more than any survey.

High-trust cultures don't happen by accident in small businesses any more than in large ones. They're the result of specific choices, made consistently, by leaders who are willing to look at the gap between their intentions and their impact.

So here's the question to carry into this week: If your team could tell you one thing they haven't been able to say — what do you suspect it would be?

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*References*

The Work Project — *How to Build a Culture of Trust in the Workplace* — theworkproject.com

Amplify HR — *5 People and Culture Trends Every Aussie SME Should Watch in 2025* — amplifyhr.com.au

Lazarus Legal — *How to Navigate a Dispute with a Co-founder* — lazaruslegal.com.au

KPMG — *Australian Business Leaders' Top Five Challenges* — kpmg.com/au

Vistage Australia — *What Are the Top Issues Affecting SMEs?* — vistage.com.au