the Law of Solid Ground states that trust is the foundation of all leadership. Trust is built through competence, connection, and character - and it is lost when people get the impression that a leader is dodging questions or deflecting responsibility. Two episodes from Olaf Scholz's time in office show how strongly public perceptions of transparency shape trust in a leader: the Wirecard scandal during his time as German finance minister, and the questions surrounding Hamburg's Warburg Bank and cum-ex transactions from his time as First Mayor of Hamburg.
A foundation of blocks with a few gaps, fog drifting above – trust needs solid ground and open answers.
An important note up front: no personal wrongdoing has been proven against Olaf Scholz in either case. He has consistently denied exerting political influence over the Warburg Bank's tax proceedings. This example therefore does not examine the question of guilt but the question of leadership: how does trust arise - and how does it fade?
01
Wirecard: When Oversight Fails
Situation
In June 2020, the payment services provider Wirecard collapsed after 1.9 billion euros could not be accounted for on its balance sheet. BaFin, the financial regulator that reports to the Federal Ministry of Finance, had failed to take warning signs seriously enough for years. Olaf Scholz was federal finance minister at the time.
Link to the law
Trust in an organization is always also trust in its leadership. When a subordinate authority fails, people ask about accountability at the top - regardless of who made the individual mistakes.
02
Showing Responsibility - or Deflecting It?
Situation
Scholz responded with a reform of BaFin; its president had to step down in early 2021. Before the Bundestag's Wirecard investigative committee in April 2021, Scholz stated that responsibility for the fraud lay with the perpetrators, not with the federal government. Critics saw this as an attempt to deflect responsibility; supporters pointed to the reforms that had been initiated.
Link to the law
For solid ground, what matters is not only whether mistakes are corrected, but also how a leader talks about them. Those who visibly take responsibility gain trust - even when they did not cause the mistake themselves.
03
Cum-Ex and Warburg Bank: The Power of a Memory Gap
Situation
As First Mayor of Hamburg, Scholz met in 2016 and 2017 with a co-owner of Warburg Bank, which was under investigation over cum-ex transactions. Before the investigative committee of the Hamburg state parliament, he stated that he could not remember the content of these conversations. He denied exerting any influence on the tax proceedings.
Link to the law
Memory gaps may be honest - yet for many people they nonetheless look like dodging. This is exactly where the Law of Solid Ground shows itself: trust depends not only on facts but on whether a leader gives the impression of informing openly and fully.
04
Trust Is a Bank Balance
Situation
Both episodes followed Scholz for years and were repeatedly raised in election campaigns and parliamentary debates - even after he became federal chancellor.
Link to the law
The law compares trust to change in a leader's pocket: good decisions fill the account, mistakes and unclear communication empty it. Open questions that remain unanswered for a long time cost trust even when no wrongdoing is ultimately found.
Key takeaways
Key Lessons on the Law of Solid Ground
01
Visibly take responsibilityWhoever stands at the top is held accountable for the whole organization - even for others' mistakes.
02
Transparency beats justificationOpen, complete information builds trust more than pointing out that one is not formally responsible.
03
Perception mattersEven honest memory gaps can look like dodging. Leaders should actively clear up ambiguities.
04
Trust takes timeDoubts, once raised, follow a leader for a long time - the trust account fills more slowly than it empties.
Summary
The Wirecard collapse and the Warburg affair show how closely trust and transparency are tied to the Law of Solid Ground. Regardless of the question of guilt, the example makes clear: leaders stand on solid ground when they visibly take responsibility, actively clarify open questions, and give people the impression that nothing is being hidden.
