A view of the City of London, from the far side of the River Thames. Photograph: Getty Images.
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A lack of trust: addressing the "trust deficit" facing UK businesses

Trust in banks and businesses has was severely hampered by the financial crisis - and has yet to recover. The mistrust cuts both ways. How can we expect a recovery without support for business from politicians and the public?

The financial crisis that seized the developed world in 2008, sending shock waves through markets and plunging the world into a prolonged recession, did more than wreak socio-economic havoc: it significantly eroded trust between politics, business and the media. By inference, the public’s trust of politics, business and the media has been negatively impacted and a series of scandals involving each of these key pillars of society has enforced this sense of mistrust and created schisms between these institutions, driving a rift between them and the public. The importance of trust cannot be underestimated: it is an essential component of a flourishing democracy and economy. Without trust, investment is severely hampered and growth is strangled before even the "green shoots" appear. The dearth of trust is one of the major issues facing society today.

A recent research report conducted by Populus, commissioned by DLA Piper, has found that multiple trust "deficits" exist in our society. Moreover, the lack of trust between the three aforementioned "estates" is not only deeper now than back in 2011, when the inaugural Trust report was published, but it is wider too, with diverging ideologies splitting political parties, the phone hacking scandal afflicting the fourth estate, and the manifold recent negative stories stemming from the business community, particular from the financial services and energy sectors, appear to have tainted the reputation of all private enterprise. It is clear that trust between business, politics and the media has now broken down completely.

"Trust in business" remains at the forefront of the political agenda. Westminster remains committed to addressing what is perceived to be widespread malpractice among businesses - from energy firms hiking prices to PPI mis-selling – all to the detriment of the consumer. There is a view that non-financial services businesses are increasingly resenting being tarnished by the same brush the media and politicians have used to smear the reputation of banks over the past few years. Businesses have not necessarily addressed this negative perception in a particularly proactive manner. While there is acknowledgement that the financial crisis has been a torrid time for businesses, there is little sign that corporate behaviour is changing in any meaningful way. In other words, it’s business as usual for most businesses, who do not see themselves as the source of the "trust deficit" problem. With one influential media commentator opining that there should be a "bankers wing" at Ford Open Prison, the lack of awareness shown by some businesses is pretty surprising.

While public outrage, manifested through politicians, media and populist movements, being directed at certain business malpractices is understandable, it has led to an unhealthy overarching anti-business mood, which is hampering a sustainable recovery in the UK. This lack of trust cuts both ways. If businesses are viewed by the majority of politicians with deep scepticism then the feeling is mutual, with a growing sense in the business community that politicians and the media simply do not understand capitalism. This is particularly the case with politicians, who can be viewed as being devoid of business experience and accused of drawing ill-informed and uphelpful conclusions, which has hampered UK growth and the international reputation of UK plc. As a corollary to this, political messages are seen by business and the media as being opaque and often contradictory.

What can businesses do to address this trust deficit? A good start would be to make more noise about the myriad ways in which British businesses should speak out more and deliver positive messages which show that they are a force for good. It is clear that businesses expect industry organisations such as the IoD and the CBI to do more in this regard, but businesses themselves should also be promoting the virtue of capitalism and the benefits it brings. Schools have a role to play in explaining the value of commercial activity and countering any cultural problem with success. Business needs to re-evaluate its social responsibility and pro bono activity accordingly. Only through a concerted effort involving all stakeholders can this critical issue be addressed and, through exploring the areas where trust has broken down, solutions for the long term formulated.

Co-CEO of DLA Piper

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Calum Kerr on Governing the Digital Economy

With the publication of the UK Digital Strategy we’ve seen another instalment in the UK Government’s ongoing effort to emphasise its digital credentials.

As the SNP’s Digital Spokesperson, there are moves here that are clearly welcome, especially in the area of skills and a recognition of the need for large scale investment in fibre infrastructure.

But for a government that wants Britain to become the “leading country for people to use digital” it should be doing far more to lead on the field that underpins so much of a prosperous digital economy: personal data.

If you want a picture of how government should not approach personal data, just look at the Concentrix scandal.

Last year my constituency office, like countless others across the country, was inundated by cases from distressed Tax Credit claimants, who found their payments had been stopped for spurious reasons.

This scandal had its roots in the UK’s current patchwork approach to personal data. As a private contractor, Concentrix had bought data on a commercial basis and then used it to try and find undeclared partners living with claimants.

In one particularly absurd case, a woman who lived in housing provided by the Joseph Rowntree Foundation had to resort to using a foodbank during the appeals process in order to prove that she did not live with Joseph Rowntree: the Quaker philanthropist who died in 1925.

In total some 45,000 claimants were affected and 86 per cent of the resulting appeals saw the initial decision overturned.

This shows just how badly things can go wrong if the right regulatory regimes are not in place.

In part this problem is a structural one. Just as the corporate world has elevated IT to board level and is beginning to re-configure the interface between digital skills and the wider workforce, government needs to emulate practices that put technology and innovation right at the heart of the operation.

To fully leverage the benefits of tech in government and to get a world-class data regime in place, we need to establish a set of foundational values about data rights and citizenship.

Sitting on the committee of the Digital Economy Bill, I couldn’t help but notice how the elements relating to data sharing, including with private companies, were rushed through.

The lack of informed consent within the Bill will almost certainly have to be looked at again as the Government moves towards implementing the EU’s General Data Protection Regulation.

This is an example of why we need democratic oversight and an open conversation, starting from first principles, about how a citizen’s data can be accessed.

Personally, I’d like Scotland and the UK to follow the example of the Republic of Estonia, by placing transparency and the rights of the citizen at the heart of the matter, so that anyone can access the data the government holds on them with ease.

This contrasts with the mentality exposed by the Concentrix scandal: all too often people who come into contact with the state are treated as service users or customers, rather than as citizens.

This paternalistic approach needs to change.  As we begin to move towards the transformative implementation of the internet of things and 5G, trust will be paramount.

Once we have that foundation, we can start to grapple with some of the most pressing and fascinating questions that the information age presents.

We’ll need that trust if we want smart cities that make urban living sustainable using big data, if the potential of AI is to be truly tapped into and if the benefits of digital healthcare are really going to be maximised.

Clearly getting accepted ethical codes of practice in place is of immense significance, but there’s a whole lot more that government could be doing to be proactive in this space.

Last month Denmark appointed the world’s first Digital Ambassador and I think there is a compelling case for an independent Department of Technology working across all government departments.

This kind of levelling-up really needs to be seen as a necessity, because one thing that we can all agree on is that that we’ve only just scratched the surface when it comes to developing the link between government and the data driven digital economy. 

In January, Hewlett Packard Enterprise and the New Statesman convened a discussion on this topic with parliamentarians from each of the three main political parties and other experts.  This article is one of a series from three of the MPs who took part, with an  introduction from James Johns of HPE, Labour MP, Angela Eagle’s view and Conservative MP, Matt Warman’s view

Calum Kerr is SNP Westminster Spokesperson for Digital