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Why high-quality firms have comfortably outperformed the S&P 500 recently

More predictable and trustworthy US businesses tend to be more profitable stock investments in the long term

More than a quarter of the top Trust Across America companies are in the top decile of the Quality Shareholders Initiative
More than a quarter of the top Trust Across America companies are in the top decile of the Quality Shareholders Initiative Photo: Getty Images

Trust is one of the most valuable assets a company can cultivate. Within an organisation, trust percolates into culture. Outside an organisation, it translates into loyalty. Quality shareholders who value long-term trust among all stakeholders  maintain this viewpoint in their investment practice.

The Trust Across America initiative has identified the most trustworthy US public companies, using objective and quantitative indicators including accounting conservativeness and financial stability, as well as a secondary screen of more subjective criteria such as employee reviews and news reports. Companies regarded as trustworthy also tend to rate highly in rankings of shareholder quality produced by the Quality Shareholders Initiative.

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