What leaders’ responses to mistakes signal about workplace trust

Article Summary

• Why leadership behaviour matters most when mistakes happen
• How concealing mistakes can undermine openness, accountability and psychological safety
• What leaders can do to make values visible through everyday behaviour

Investors in People’s The Trust Paradox research highlights a difficult credibility problem for organisations that talk about openness, learning and psychological safety.

Executive-level respondents are more likely than employees overall to avoid speaking up about mistakes they have made at work. A third of executive-level respondents said they had avoided speaking up about their own mistakes, compared with 14% across all employees.

IIP CEO Katherine Chapman highlighted this finding at the Make Work Better Conference when talking about what Leading looks like in practice. If leaders want openness from others, she argued, they need to show that the same expectation applies at the top.

For organisations asking people to speak up early, challenge existing ways of working and learn from failure this is a key finding. It suggests that openness may be spoken about as a shared value while being experienced as a higher risk for some people than for others. Such a pattern creates a credibility risk that employees may notice.

That is where values either gain credibility or lose it. When senior leaders discuss mistakes constructively they give employees evidence about how openness and accountability are handled. This can influence whether others believe it is safe to acknowledge problems early.

Why leadership role-modelling matters for trust

Leadership behaviour carries particular weight when it comes to trust because it sets the terms of what is safe, acceptable and rewarded. Formal statements about openness can set direction but employees take their cues from more ordinary evidence: how leaders respond when plans change, how they talk about decisions that did not work, how they handle challenge and whether they apply the same behavioural expectations to themselves that they place on managers and employees.

This is important because trust in leaders is closely connected to performance. A 2021 meta-analysis of 185 independent studies found a strong relationship between trust in leaders and performance outcomes, suggesting that trust may be one of the mechanisms through which leadership is associated with performance. It also found that affective trust, the form of trust grounded in perceptions of a leader’s motives and care for others, is a more powerful predictor of performance and organisational citizenship behaviour than cognitive trust alone.

In other words, employees may still believe a leader is competent while becoming less sure about their motives. A hidden mistake may change how people interpret later messages about openness, ethics or learning because it raises a deeper question about whether leaders are willing to be honest when honesty carries personal or reputational cost.

The risk, then, is rarely limited to the mistake itself but in the behaviour that follows. If senior people treat mistakes as threats to be managed out of sight then others will often conclude that openness is conditional. People may become more cautious about surfacing problems, asking for help or challenging a decision early enough for the organisation to act.

The Center for Creative Leadership argues that trust is especially critical during change and disruption, when leaders must balance tensions such as transparency and discretion, confidence and humility or accountability and empathy. Leaders do not build trust simply by appearing relatable but by behaving consistently when people are looking for evidence of whether they can rely on them.

What happens when leaders hide mistakes?

Research by Bart de Jong, Kurt Dirks and Nicole Gillespie finds that the link between trust and performance is stronger where decision-making power is more concentrated. That is significant for leadership because employees in those settings are more dependent on people with authority to make thoughtful decisions, listen to accurate information and act in the interests of the wider team.

When leaders hide mistakes in that context employees have less room to correct the story themselves. They rely on senior people to name reality, explain what happened and create the conditions in which others can contribute safely. Silence from the top can make people more watchful and more guarded, using energy to read risk rather than to solve problems.

The link between openness, accountability and trust

Some leaders worry that acknowledging mistakes will weaken confidence. Confidence may be weakened less by an honest acknowledgement than by vagueness, defensiveness or communication that feels overly managed. Being open in a measured way need not weaken a leader’s authority.

This is where vulnerability needs careful handling. Useful leadership vulnerability is work-focused and proportionate. It is the willingness to be clear about what happened, what has been learned, what remains uncertain and what will change as a result. It does not require emotional performance or public confession but enough honesty for employees to believe that the organisation’s values still apply when there is something at stake.

Deloitte’s HX TrustID research identifies transparency as one of four factors of trust, alongside humanity, capability and reliability, and defines it in terms of openly sharing information, motives and choices in straightforward language. It also finds that business leaders overestimate customer trust by more than 50%. Although this research looks beyond internal workplace trust alone the message is relevant: leaders can believe their intentions are visible while employees experience something more controlled, selective or incomplete.

Tom Foley, lead human intelligence for Performance Specialist at Leading Edge Performance, argues that trust is the operating condition that makes high performance possible.

“The role of a leader is to manage the trust barometer through a combination of trust mechanics and trust organics,” he says. “Often leaders try to over-explain, but more information is not necessarily better. It’s about the content and coming back to the legitimacy of what you are saying and doing, not what you’re telling people you are doing.”

Why values must be visible in leadership behaviour

The We invest in people framework gives this issue a practical organisational frame. Under Leading and inspiring people it places emphasis on creating transparency and trust, including regular two-way communication, trust at all levels and leaders acting as role models. Under Living the organisation’s values and behaviours it asks whether people and leaders act in line with values at all times and whether people have the courage and support to challenge inconsistent behaviours.

This phrase, ‘at all times’, is important. Values are easy to support when decisions are popular, performance is strong and the story is straightforward. Their real test comes when there is tension: a poor decision, a failed initiative, a difficult restructure, uncomfortable feedback or a leader whose behaviour falls short of what the organisation says it expects.

The framework asks whether behaviours are assessed against organisational values, whether open and constructive dialogue is part of managing performance and whether people are encouraged to learn from efforts, mistakes and successes. This makes openness about mistakes a practical leadership capability rather than a vague cultural aspiration.

Trust becomes credible when values are visible in behaviour. Employees need to see that openness, accountability and learning are shared expectations across the organisation, including among the people with the most power.

Leadership checklist – are your values visible when things go wrong?

Are leaders modelling the openness they ask of others? Use our checklist to find out:

• Mistakes: Do leaders acknowledge mistakes in ways that help others learn?
• Accountability: Are senior people held to the same behavioural standards as everyone else?
• Communication: When decisions change, do leaders explain what prompted the change and what has been learned?
• Challenge: Do leaders respond constructively when employees question decisions or raise concerns?
• Values: Are organisational values visible in difficult moments, such as restructures, performance issues or failed initiatives?
• Learning: Are mistakes reviewed through systems, process and decision-making, rather than individual blame alone?
• Consistency: Do leadership behaviours match the expectations placed on managers and employees?
• Follow-through: When leaders commit to action, do employees see visible progress?

When leaders hide mistakes trust becomes harder to sustain. Employees can hear messages about openness, learning and psychological safety but they will judge those messages through the behaviour they see from the people with the most power.

Leadership vulnerability does not require oversharing or performative honesty. The most trusted leaders are not those who appear never to get things wrong. They are those who show that mistakes can be acknowledged, understood and used to improve how the organisation works.

Related conference session: Watch Charlie Cannon explore psychological safety, wellbeing and the new social contract at Make Work Better 2026.

Sources

1. 1.A. Legood et al, A Meta-Analysis of the Role of Trust in the Leadership-Performance Relationship. https://doi.org/10.1080/1359432X.2020.1819241
2. 2.Center for Creative Leadership, Why Leadership Trust Is Critical, Especially in Times of Change. https://www.ccl.org/articles/leading-effectively-articles/why-leadership-trust-is-critical-in-times-of-change-and-disruption/
3. 3.Bart A de Jong, Kurt T Dirks, Nicole Gillespie, Trust and team performance: A meta-analysis of main effects, moderators, and covariates. DOI:10.1037/apl0000110
4. 4.Deloitte, TrustID™ Create competitive advantage for loyalty through trust. https://www.deloittedigital.com/us/en/accelerators/trustid.html