This lesson has been made clear in the current downturn. As has been reported, while many organizations had a good handle on the risks in specific parts of their business, they lacked the larger picture of their risk as a whole. Similarly, we see reports that some leaders relied on "intuition" rather than factual analysis. Here again the organization needs more hard numbers and more eyes on the risks, at both the unit and enterprise level.

Similarly, the power of the community can help in anticipating unforeseen and unfamiliar events. Striving for such clarity creates a risk-intelligent community in which leaders can challenge assumptions and create a range of scenarios to deal with both the expected and the unexpected. Leaders also need the freedom to make contrarian decisions about risks—decisions that, while unpopular at the time, are infinitely preferable to following the herd over the cliff.

Moreover, when our people make the tough or unpopular calls, it is critical that we stand behind, and even applaud, their judgments. In my experience, this assurance should be explicit and regularly communicated, especially by the organization's top leaders. This is especially important in managing ethical risk. People need to know, no matter what, that they can raise their hands and speak up—and be supported in doing so.

Second, there's connectivity—the kind of transparent system that keeps people informed and focused on the right things. It begins with making sure that people at every level have a common definition of risk, one that looks both at value preservation (the down side), as well as value creation (the upside). It requires an organization-wide risk framework supported by appropriate standards. And it requires a strong system of governance, especially at the board and audit committee level.

Studies show that too often boards are not as involved as they should be, and the issue can be a lack of useful information. In many cases, boards can be overwhelmed with raw and inconsistent internal data, with limited context and often little or no guidance in how to interpret it.

The result is a growing gap between what the stakeholders—including the public, shareholders, analysts, and regulators—expect and what boards can actually deliver. To close that gap, and to create the true checks and balances required, boards and management need a deeper level of involvement.

Third, there's the core of any successful organization—accountability. It starts with the tone at the top, and it requires a hands-on leader who keeps employees grounded and fully aware of the risks, especially in understanding how much is directly riding on them. Above all, people at all levels need to understand how costly a breach of trust can be, in reputation, dollars, and brand.

Finally, for the leader, there is the power of personal connection when weighing risk decisions. Don't isolate yourself—take to your feet. Walk down the hall. Eat in the lunchroom. Make an effort, as we say, to know what you don't know, looking at both the downside and the upside. In turn, expect the risk owners to be equally active and inclusive—and vocal—in their own due diligence. Rock the boat. Question. And do it with complete transparency.

Trust is our license to operate. It's our health and our future, and it's as critical to employees and stakeholders as it is to the communities who need to depend on us as a solid and caring neighbor. Repairing the trust will require total commitment, but the rewards are many, beginning with perhaps the most powerful feeling of all for employees—pride.

It's going to take a lot to get from where we are to trust and confidence. I say let that work commence now.