We need to move from an economy built on distrust towards a Trust Economy.

Everybody has a plan – until they don’t. In a hypercomplex and equally connected world, expecting the unexpected is prudent. Except that politically, environmentally and now epidemiologically, we didn’t see global issues coming until they were all too real. As a Trust Futurist, I believe our choices reveal what we value and trust. Psychologists will tell you that this is often short-term gain at the expense of our long-term future, but the last thing you and I need right now is a pessimist stance. We need a plan.

We seem to have learned from the global financial crisis in 2007/2008 that waiting out a crisis by looking the other way is about the worst posture we can assume. Currently, some airlines and hotels are issuing refunds they don’t have to, retailers in many places are donating items they could sell, and news publications are lifting their paywalls to keep us informed. Tough times like these call upon us to set aside individual differences and do what is right for the greater good. Every initiative we take to help will ease our shared global burden. It means relying on governments alone to bail us out of the situation isn’t going to do the job. We should embrace the unifying power of a common enemy to proactively come up with creative solutions in our fight against this pandemic. 

Why Exiting This Crisis Will Require a New Mindset Centered Around Trust

Many societies rely too heavily on distrust-driven measures to regulate behaviour, i.e. constraining people with penalties or prohibitions. Self-control and following rules aren’t one and the same, because the former requires that we care. Until recently, the distrust economy got away with the notion that rules are all we need – i.e. if we acted selfishly in the market, that would suffice to create collective gain.

The courage to embrace something new and willingness to collaborate will require us to trust each other and our shared contribution to the solution. Using sharing economy platforms to do business with each other has helped us discover hidden value and purpose, build relationships and get stuff done more effectively. When we look at the sharing mindset that this Trust Economy has inspired us to adopt in recent years, the benefits are obvious. Many digital platforms we use facilitate interhuman trust very frictionlessly. Peer ratings, community rules and smart algorithms take care of the distrusting for us, so we can focus on trusting each other. We can use digital to inspire people to adopt the right behaviour with joy and ease, beyond those cumbersome compliance forms. 

The Promise of the Trust Economy

I’m not just a Trust Futurist, I’m also an eternal optimist, and I believe nobody enjoys distrusting or being distrusted. One of the biggest trends we’re seeing right now is that the Trust Economy is driving a relationship renaissance, re-humanising our mostly transactional global economy. Transparency, provenance and sustainability (knowing where things come from, and that they are made consciously) are demanded more than ever. They will ensure a fairer distribution of value, too. If you knew the person that made your T-Shirt, you’d probably agree that they deserve a fair compensation for their work. Win-win situations are more satisfying than win-lose dynamics. 

As humans we’re deeply wired to trust, bond together and treat each other fairly, but this gets complicated once financial capital and global markets enter the picture, allowing us to trade with anyone often even in the absence of a relationship. The less visible the individual, the less we are inclined to care about their end of the bargain. Say you put a dozen people that don’t know each other in a room, hand them twelve 10-dollar-notes and ask them to share among the group. How much do you think everyone gets? In the global economy, all value distribution is inherently skewed. It’s not sustainable, and it hardly feels great, even if you’re in the power position. Perhaps that’s why our incremental happiness gained through economic prosperity plateaus at middle-income level. Deep down we know others may have suffered for this prosperity of ours more than we’d like to know.

Bringing trust back into business in a big way is but one of the achievements of the Trust Economy, and it’s done us a big favour with it. We are born to trust and care for our tribes. Digital trust intermediaries enable us to scale that dynamic at virtually no cost. This should technically enable us to create a global village of inclusive socioeconomic progress, and create a future in which default mutual trust creates a streamlined and fairer global economic system. In fact, we already know that high-trust environments make us feel amazing – mutual trust stimulates our brain to synthesise the kind of hormones that makes us feel good. No wonder the world’s highest-performing teams operate on principles of high-trust.

But before we get carried away in that dream, reality will hit.

The Generational Divide on Digital Trust

We live in a world accustomed to inflationary, pathological distrust. Think security checks, contracts, compliance and so on. It’s necessary, but it wastes time and annoys most of us. All this bureaucracy effectively prevents important change, because its job is to protect the status quo. Global productivity gains per year have essentially been on the decline since the 1950s. While technology is advancing exponentially, we’re unable to do the same with productivity. 

So, distrust is creating a productivity and innovation ceiling. I call this the distrust epidemic. It’s ineffective and on top of that nobody really likes to distrust, we just got used to it. 

Encouragingly, we see the complete opposite across the digital economy. But all is not well. We all too willingly place our trust in digital interfaces, platforms and the data and technology powering them. Marketplaces and peer-to-peer business models have changed our behaviour and we nowadays easily trust strangers online. This caused a wave of over-trust in the digital economy. I mean, do you ever read website terms and conditions before clicking accept? 

I see two major problems with this. Our younger generations, meaning Gen Y, Z and whoever comes after this, increasingly and indiscriminately trust technology because it makes life easier to do so. Meanwhile Baby Boomers and Gen X are more sceptical and resist this somewhat. That disconnect between generations is likely to escalate. More senior generations expect trust to be earned, young folks trust fast and want to be trusted by default (until or unless they screw up.) This already causes lots of frustration inside organisations, because different generations have these different attitudes to trust and therefore data, technology and leadership. It’s a constant, dysfunctional blame game of ‘why don’t you trust me’ versus ‘why don’t you work towards earning my trust.’

Where to Go From Here?

Ironically, the distrust epidemic is currently being replaced by a digital trust epidemic. The trust-first camp will over trust and take far too high risks until (in the worst case) everything comes crashing down. This might lead them to lose everything and even cause major disasters (just think of the Cybersecurity issues we already have today!) Meanwhile, people and companies who embrace distrust as a first principle will keep adding more rules until it becomes impossible to compete. As the world gets ever more complex, they will eventually grind to a halt, suffocated by all that distrust.

We should endeavour to find a balanced middle way. Smart organisations are starting to realise that less rules can result in more compliance, and many innovative companies are showing that trust-first does not necessarily equal naive. A solution is for all camps to come to the table, understand each other’s different sentiments, find a healthy balance between too much and too little trust and establish common ground for a brighter future.