Character Driven Leadership

← The evidence

EV-0008

Too much trust has costs — the case against simply trusting more

Molina-Morales, F. X., Martínez-Fernández, M. T., & Torlò, V. J. (2011). Long Range Planning, 44(2), 118–133 · Source

study Moderate evidence Abstract only

What this entitles us to say

Trust and performance are not monotonic: beyond a point, further trust brings costs rather than benefits, as firms over-invest in relationships, drop safeguards and take on risk they would not otherwise accept.

What it found

Examining firms in industrial districts, it reports benefits from trust up to a threshold and costs beyond it — misallocated resources, reduced monitoring, and unnecessary risk — implying an inverted-U rather than a straight line. It sits within a broader "dark side of trust" literature arguing that trust past an optimal level removes safeguards and creates room for opportunism.

Why it matters here

This is the strongest objection to a program that promises to build trust, and it happens to land on the framework's side.

The critique bites on anyone preaching "trust each other more." It does not bite here, because the trait is a dyad: Trust / Trustworthy. The framework never asks anyone to extend trust indiscriminately — it asks people to become worth trusting, which is the thing that makes extending it rational rather than reckless. Trust granted without warrant is precisely the failure this literature describes.

It also disciplines the Culture Wall and the recognition mechanic. Celebrating trust as an unqualified good would be a small dishonesty; what is worth celebrating is trust that has been earned.

The limits

A specific setting — firms in industrial districts, innovation outcomes — so the shape of the curve does not transfer directly to trust between colleagues. Treat it as a well-argued corrective to naive trust-maximising, not as a measured optimum anyone could apply.

Bears on

Trustworthy

Checked

Claude, 15 Aug 2026 — Source located and the headline finding confirmed from the abstract. Enough to cite; not enough for us to quote a precise number.

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