Employees are losing faith in their company’s future. Here’s the cost and the fix

Business performance rarely deteriorates overnight. It tends to show up earlier in how employees assess their company’s prospects. Right now, that confidence is weakening, writes Justin Angsuwat.

Our global benchmark data, drawn from millions of employee responses across industries and regions between 2019 and 2025, shows that belief in future company success has dropped from 80 per cent in 2021 to 72 per cent in 2025.

That decline is playing out as organisations navigate cost pressure, rapid advances in AI, and ongoing transformation. In this kind of environment, priorities shift, trade-offs become more visible, and it becomes harder for people to see how everything connects. When that connection isn’t clear, confidence starts to erode.

Company confidence is a culture signal that should sit alongside the core indicators leaders use to understand performance. Our data shows that organisations with both high engagement and strong confidence in direction outperform peers, delivering up to a 47 per cent share price advantage over time.

There’s an important nuance worth calling out. Employees aren’t losing faith in their product: roughly three in four still believe their organisation’s products and services are competitive.

But confidence in execution is weaker. Only 60 per cent believe resources are being effectively directed towards company goals. That’s a meaningful gap, and it suggests strategy and investment aren’t lining up in a way people can actually see. When that happens, execution breaks down.

The gap between a strong product and a clear path to winning matters more now because the environment inside organisations is becoming more complex. A lot of the discussion around AI has focused on capability: how it can improve productivity, automate work, and unlock growth. But its most immediate impact is on the pace of change. Strategy cycles are compressing. Decisions are happening faster. Priorities are shifting more frequently. Alignment is harder to maintain, and it’s never been more important to get right.

When employees can’t see how decisions, trade-offs and investments connect to a coherent direction, confidence drops. And when confidence drops, so does discretionary effort – often the difference between strategy succeeding or stalling. AI alone isn’t creating this dynamic, but it is accelerating it.

For executives and boards, company confidence is also a governance issue. It offers something most traditional metrics don’t: a forward-looking view of execution risk. Financial results reflect what has already happened. Company confidence reflects whether the organisation is set up to deliver what comes next.

Yet fewer companies are asking the question. Between 2019 and 2025, the share of organisations including company confidence items in engagement surveys fell from roughly 71–79 per cent to just 48–65 per cent, depending on the question. At a time when leaders are making faster, higher-stakes decisions, that’s a growing blind spot.

How HR leaders can drive confidence and performance

For HR leaders, company confidence is a practical North Star. Are our goals believable? Are our leaders trusted? Do our systems back this up? In other words, do we have a game plan that the team believes in?

When confidence starts to weaken, the breakdown is usually traceable. It shows up in the clarity of goals and priorities, the alignment between strategy and execution, and the credibility of leadership. Where we can get those right, confidence and performance likely follow.

Clarity of goals and priorities

Employees need to see themselves in the strategy. When goals feel disconnected from day-to-day work, confidence drops – and with it, momentum. The test is whether priorities actually guide decisions, not just articulate ambition.

This is more than a communication issue. It’s about how clearly strategy translates into work: how priorities are set, how trade-offs are made, and whether day-to-day decisions reflect what leaders say matters.

What to do: Pressure-test priorities at every level. Ask leaders and teams to articulate them in their own words, and check whether they guide real decisions. If different teams describe different priorities, that’s where confidence starts to drift.

Alignment between strategy and execution

Confidence also depends on what people see the organisation actually do. When resources, decisions and trade-offs don’t reflect stated priorities, belief erodes quickly. It’s not enough to set direction; it has to show up consistently in how the business operates.

What to do: Audit where time, budget, and attention are going. Look for mismatches between stated priorities and actual investment. Reset regularly, especially as conditions change, so that decisions, trade-offs and resource allocation stay aligned with what matters most.

Leadership credibility and transparency

Confidence is ultimately a test of trust. Leaders who communicate trade-offs openly, show progress consistently, and connect decisions to a clear direction are far more likely to sustain belief over time.

When these elements come together, ambitious goals energise people. Stretch targets become a sign of opportunity, not threat. When they don’t, those same targets create uncertainty, and performance becomes harder to sustain.

What to do: Be explicit about trade-offs and connect decisions back to strategy. Share progress regularly, even when it’s uneven. Consistency matters more than perfection. People are looking for signals that leaders are deliberate and aligned in how they operate.

These aren’t new ideas. But in a faster-moving, more complex environment, they require more discipline to get right.

When leaders make the strategy clear, align how the organisation operates, and follow through consistently, confidence strengthens. And when confidence is strong, people move with the strategy, not around it.

That’s what turns strategy into results.

Justin Angsuwat is the chief people and customer engagement officer at Culture Amp.

Want to see more stories from trusted news sources?
Make HR Leader a preferred news source on Google.