I asked a venture capitalist investor, who works with, meets & evaluates top CEOs & founders what is the biggest obstacle that causes leaders & their companies to be less effective.

The answer: The leaders’ inability to trust others. They simply can’t let go of direct responsibilities.

This inability to put their trust in others is not just a quirk of the leader. It’s damaging to the organization and its team members. Lack of trust from a leader, research shows, leads to lack of company growth, lack of production, workplace unhappiness and greater turnover. One study suggests employees who don’t feel trusted are more likely to leave or – as it says – worse, they stay and underperform.

Research has suggested for decades about the correlation between a “high-trust culture” and business strength. Yet, it still seems to be one of the biggest challenges that top leaders & owners face.

Here’s some of the culprits that lead to a lack of trust.

Stress & fear

Paul Zak, founder of Center for Neuroeconomics Studies & author of “Trust Factor: The Science of Creating High-Performance Companies” conducted research showing the brain chemical oxytocin is correlated with our ability to trust others.

The more stress we carry and the more fear we experience on what and how projects get done, the less oxytocin we produce, therefore the less trust we can feel.

I repeatedly hear the sentiment – “I can do it better” or the similar “only I can do it.” The stress that we create by the thought of someone not doing something well or “the right way” leads to the stress & fear about the potential negative consequences. Less oxytocin is available.

The more stress and the more fear you feel the less you are able to trust.

Perceived lack of control

A nearly 20 year old study from International Sociology points to the perception of control leading to feelings of trust. It defines trust as “a psychological state comprising the intention to accept vulnerability based on positive expectations of the intentions or the behavior of another.”

In other words, when we feel what someone wants to do or the actions that they will take will have a negative outcome, we feel a loss of control over how we want the situation to unfold.

Reality is we DO have a lack of control over the intentions and actions of other people. What we have control over is ourselves – our intentions and behaviors. When we are no longer able to accept simply controlling our controllables, we’ll fall prey to feeling out of control and therefore lacking trust.

A fixed (non-growth) mindset

When I’ve surveyed rooms I speak in and ask people to raise their hand based on having a growth mindset vs a fixed mindset, the results are predictable. Majority of hands go up for a growth mindset; hardly any go up for a fixed mindset.

The concept of having a growth mindset as a bedrock for success is commonplace; thus, having a fixed mindset is a negative.

Yet, growth vs fixed is not a binary choice and you’re not all or nothing. According to the godmother of growth mindset Carol Dweck, it’s on a continuum and most people fall somewhere along the spectrum.

Therefore, when a leader experiences more of a fixed mindset and believes that irreparable damage might happen from someone’s actions, our trust goes down. This is at the root of “I can do it better.” In many cases, of course you can. You built your company on your ability to do that thing.

Yet, when we believe that someone else who is capable of the assignment might not do it as good, instead of believing that we can learn & grow from it, you believe that consequences are irreparably harmful. Trust will not exist if we cannot grow from mistakes.

Work-based identity

Too many of us get a large part of our identity from our work. To be fair, taking pride in what we do and feeling good about ourselves based on that is not a problem. Yet, if how we view ourselves rises and falls based on work outcomes, it becomes a massive liability.

Think about these two differences in these identities of someone who runs a real estate sales business. “I am a relentless advocate for people making the most significant purchasing & selling decisions in their lives” vs “I am a million dollar home sales business owner.” Both can be true. Yet, what happens if the million dollar business person fails to get the million one year. Then who are they??

Now, if the prospect of them NOT living into the identity of that “million dollar owner” comes up, the leader will take it upon themselves to protect that identity. That will lead to a lack of trust.

Your ability to trust as a leader is one of the biggest advantages you can have. Not to mention, showing trust helps to build a high-trust culture. Next week, we’ll talk through strategies to develop trust as a leader and to move away some of the culprits here.

In the meantime, if you read this and feel like it hits a trigger, reach out. I work with  leaders to remove the inevitable obstacles that impact growth & fulfillment and build stronger businesses based on purpose, mission, values and ultimately joy.