Businesses are increasingly expected to act on pressing global issues, like the climate crisis, rising inequality, and growing demand for more sustainable practices. They have the ambition and the reach to make widespread change, and they have the technological means to make it happen.

But a growing public mistrust in large organizations hinders many businesses’ ability to use technology to its full potential. Trust in large organizations, political agents, and even in technology itself, is declining. Politicians, advertising executives, bankers, and business leaders are among the most distrusted people, according to the Ipsos 2022 Global Trustworthiness Index. Current events associated with unethical technology use, unethical business practices, and a lack of transparency in actions and objectives are having a negative effect on companies’ ability to use technology at scale to bring about positive change.

Bad actors using technology to create deep fakes, digital clones, phishing scams, and the like are on the rise – and as a result, technology adoption is perceived as fraught with risk by the general public. We must realize the importance of trust to technology adoption and business, what our roles as individuals and consumers of technology are, and how trust should be fostered so it can help businesses and technology address the world’s greatest challenges today and in the future.

The role of trust in business and technology

Why does anyone trust another person, a technology, or a business? Why do we trust the directions our GPS systems give us? Why do we trust the recommendations our music streaming platforms offer?

On the most basic level, trust is based on biochemistry as, according to studies, the hormone oxytocin increases both trust and trustworthiness in humans. This hormone can be naturally produced or inhibited, in different functions, and as a response to different stimuli, such as stress. If we abstract from biochemistry and the brain, a few external psychological factors affect trust in people (a.k.a. trust factors):

• Competence: Recognized ability to do or deliver what needs to be done
• Integrity: Demonstration of ethical behaviors
• Benevolence: Signs of kindness and the treatment of others
• Predictability: Ability to be consistent in outcomes

This construct can also be applied to businesses. According to PWC research, “87% of business executives believe that their stakeholders trust their companies,” while only 30% of consumers agree. When asked about what could earn their trust in an organization, customers responded with the products and services provided (i.e., related to predictability) but also stressed the importance of how employees are treated (benevolence), corporate citizenship (integrity), and the ability of leadership to admit and respond to mistakes (integrity and competence).

Why does anyone trust another person, a technology, or a business? Why do we trust the directions our GPS systems give us? Why do we trust the recommendations our music streaming platforms offer?

Technology can potentially increase trust in a business by increasing competence and predictability in business processes, ensuring products and services are delivered consistently, on time, and at the highest quality—as expected. Technology can also provide transparency to the trust factors listed above. And it can enable timely reporting and integrate with other insights, such as employee feedback and corporate citizenship reporting, giving us the impression that it may be easier to trust a technology-enabled business.

Businesses, including technology providers, need to comply with data protection and privacy regulations, alert customers of outages or cyber incidents, communicate about solution updates, and recommend remediation efforts in the event of an identified vulnerability, all with the goal of delivering on customer commitments.

To realize the full potential of technological progress and growth, successful innovators must be transparent about the intended use of their technology, while preserving the privacy and security of the data they are processing. As in any sustainable relationship, the relationship between the customer and vendor should be founded on trust, transparency, guidance, and value. And that trust needs to be prioritized by organizations.

How to be a trustworthy business

Fostering and leading with trust is good business!

In the past, businesses have quantified customer trustworthiness in financial terms, measuring their trustworthiness in their ability to pay. For example, when financial institutions decide to lend money or not, there is a metric to determine the financial risk of taking on this financial responsibility. It is only natural that customers are now looking for a similar quantification from businesses. Can a business be trusted to deliver on its promises? Consumers seek out reviews, feedback, opinions, and ratings from previous customers and check a product’s safety records before buying.

For businesses, trust affects both competitiveness and financial results. In extreme cases, companies have lost 20% to 56% of their whole value due to a loss in stakeholder trust, according to findings from Deloitte.

In the past, businesses have quantified customer trustworthiness in financial terms, measuring their trustworthiness in their ability to pay. … It is only natural that customers are now looking for a similar quantification from businesses.

Another important element of trust is that it begins with an organization’s workforce. According to Harvard Business Review, employees at highly trusted companies are 74% less stressed, manifesting in 106% more energy at work and a 50% higher productivity. Employees who trust their company are not only the best ambassadors for the business but also crucial for its prosperity and growth.

Just as trust binds people together, it also binds business partners. In an increasingly complex and interconnected world, businesses need to look beyond their own boundaries and seek trustworthiness in the networks they belong to. It is not enough to be the trusted element of an untrusted network.

Building and measuring trust

Trust is a precious, universal currency standard, and it needs to be treated as such. Its reach far exceeds any single business priority but can still be measured on an individual basis – alongside other key business indicators. Therefore, a strategy and framework to build, measure, and maintain trust needs to be defined.

There are several approaches to modeling trust. One example is a trust-confidence-cooperation model. In this setup, three of the key trust factors (competence, benevolence, and integrity) are basic inputs for an individual’s trust metrics prior to entering a relationship or transaction. The resulting trust level will be a key factor in the perceived risk of entering a transaction with a business. Once the risk has been taken, the individual will determine whether the outcome validates their trust. The continued application of this model will then determine the predictability – the fourth trust factor – of further transactions in such a relationship.

Trust is a precious, universal currency standard, and it needs to be treated as such.

In a business, it is possible to identify metrics that affect these four pillars:

• Competence: Quality of the product/service, customer experience, usage of technology, innovation
• Predictability: Strategy, reliability, process governance, and purpose
• Benevolence: Sustainability practices; diversity; equity; inclusion; environmental, social and governance; workforce experience
• Integrity: Financial integrity, ethics, value statements and adherence to them, transparency, compliance, data protection

Many of these metrics can be put into an integrated key performance indicator framework to help businesses understand where to focus their efforts to increase trust levels.

For a technology-driven business, trust needs to be fostered throughout the entire customer relationship. For example, there is a higher level of responsibility for businesses that host personal and transactional data, and they must be transparent about how they protect this data, stay up to date with the latest regulations where their customers operate, and ensure the security controls they deploy are appropriate and robust.

In the event of a crisis, businesses must show a full, commitment to accountability, being transparent about any shortcomings and how they will remediate issues. Platform businesses, like Airbnb, must proactively prevent users from misleading each other, with ID verification, guest reviews, and secure payment processes. As these measures are put in place, ways of monitoring and analyzing them will produce metrics to continuously evaluate and act on trust.

Building a future we can rely on

A sustainable future and business environment can only be achieved with trust. Trust is the foundation of the relationship between people, businesses, and technology.

The good news is that 10% of Fortune 100 companies have started that journey by establishing trust offices that aim to foster customer trust across domains and industries. This demonstrates the weight of trust in advancing innovation, growth, and progress for business and society. This new business category – trust – aims to address the growing demand for security, privacy, and transparency by stakeholders and users worldwide. Chief trust officers should also be passionate advocates on other trust issues, depending on the needs of the business and its environment, including diversity, equity, and inclusion.

For example, at SAP, the chief trust office aims to drive core leadership in setting responsible policies, frameworks, and processes with customers and users.

Ten percent of Fortune 100 companies have established trust offices that aim to foster customer trust across domains and industries. This demonstrates the weight of trust in advancing innovation, growth, and progress for business and society.

The next step is for all business leaders to act

If your purpose is to help tackle the most prominent challenges of the world we live in, then make earning trust the top priority of your business imperatives. Nothing will empower your use of technology more than this.

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