When employees don’t trust managers to make good decisions or to behave with integrity, their motivation is seriously compromised. Their distrust and its attendant lack of engagement is a huge, unrecognized problem in most organizations. This issue has always mattered, but it matters now more than ever, because knowledge-based organizations are totally dependent on the commitment and ideas of their employees.
For a full report read: http://hbr.org/2003/01/fair-process/ar/1