The critical case for policy that instills digital trust
Q&A with Bhaskar Chakravorti of The Fletcher School at Tufts University
August 29, 2023 l By Chris Harrall
There’s no question that the digital economy is playing a larger role in our lives and livelihoods. Over the last fifteen years, the digital economy has grown two and a half times faster than the global GDP. Yet with this growth, we see evidence of a paradox emerging: the more time we spend on digital platforms, the less we trust these interactions.
Trust is essential to our ability to integrate emerging technologies into the wider economic system, explains Bhaskar Chakravorti, Dean of Global Business at The Fletcher School at Tufts University, founding Executive Director of Fletcher's Institute for Business in the Global Context, and founder and chair of Digital Planet. Chakravorti points out that we’re already seeing this impact in several industries. For example, an analysis of why lagging use of AI in healthcare reveals a lack of trust in algorithms, and a lack of trust has been a major hurdle to the adoption of self-driving cars.
According to Chakravorti, the next evolution of our digital economy depends upon our ability to instill trust in these interactions—and doing so may require the rise of new public-private partnerships. I recently spoke with Chakravorti about the value of digital trust, and the role policymakers can play in ensuring consumers can trust the technology service providers with whom they share their data.
Q: How can we go about closing this “digital trust gap”?
Chakravorti: It is unlikely that the trust gap will ever close completely, but we can implement guardrails that minimize the friction created by this trust gap. First, however, it is helpful to note that in some cases friction can instill trust. For example, when purchasing something from an ecommerce site, users may be prompted to enter an authentication code sent to their mobile phone. While this additional step slows the transaction, it provides consumers with the sense that the industry takes user security seriously. There are many examples of how service providers are already taking steps to build trust with consumers, eliminating “unproductive” friction, such as a transaction being declined, while keeping trust-enhancing, “productive” friction in place.
Yet given the size and rapid growth of the digital economy, we must think bigger about how we minimize the trust gap. Of course, it is unlikely that we’ll completely close the gap. A useful analogy might be to think about driving a vehicle. No matter how short your route, there is no way to eliminate the risk of an accident along the way. However, we have put systems in place that mitigate this risk to the point that we rarely even think of the danger inherent in driving down the street. These systems come from automobile OEMs in the form of seatbelts, airbags, sensors, and emerging self-driving capabilities. They are also the result of policy that mandates use of these safety devices and establishes traffic laws. And, of course, they are the result of drivers who are trained to use these tools and safely operate their vehicles.
This combination of operator education, technology provider action, and regulations set by policymakers will be necessary for implementing technological guardrails and creating a sense of digital trust.
Q: You have suggested that a digital trust fiduciary could help support this type of collaboration around digital trust. What might such an entity look like?
Chakravorti: There are different ways such a service could arise, but I don't believe the private sector on its own can serve as a digital trust fiduciary without some form of public accreditation. We would inevitably get to a point where companies use their ability to engender greater digital trust as a source of competitive advantage. To be credible and address the complexity of the existing trust gap, we need a public-private collaboration dedicated to making digital services work for users.
This might begin with a policy framework that establishes standards, processes for authenticating the presence of digital trust, and potential penalties for guarantors who fail to guarantee it. The guarantors should also participate in this framework-building process. Today’s emerging technologies are so esoteric that the participation of the technology providers is essential to formulate secure policies.
With these frameworks in place, I believe we could see a rise in independent service professionals who can understand and advocate for digital users’ needs. Their job would be to offer digital trust as a product or service, designed around the user’s needs. These professionals would, ideally, be certified and regulated, much like doctors and financial advisors, although there may be a public entity role here as well.
Q: Are there examples from other industries we can use as templates for this digital fiduciary?
Chakravorti: As one example, the technology industry might look to the public-private-partnerships that guide the financial industry. A combination of financial regulations and service providers (accountants, financial advisors, and other consultants) ensure that public companies accurately report data with the welfare of the broader market in mind. If one were to think of that same concept carrying over to the state of trust in the digital system, digital trust fiduciaries acting in the best interest of digital users could audit various aspects of digital interaction. Those areas might include cybersecurity measures, how data is used, system pricing, and other factors. This professional class could potentially grow from within the current IT, cybersecurity and management consulting industry, or arise out as something altogether new.
Q: It would seem to me that previously proposed frameworks that have been jointly developed by the private and public sectors, such as guidance offered in the World Economic Forum’s “Earning Digital Trust: Decision-Making for Trustworthy Technologies”, would be useful in helping policymakers shape the digital fiduciary role. As a contributor to that framework, Mastercard believes a common set of principles and requirements for digital trust is a critical starting point to achieve the necessary level of shared responsibility. Any closing thoughts on how a framework such as this could be applied?
Chakravorti: Regulators and policymakers would have to set standards that regulate and professionalize the system of trust. Just as accountants must pass the CPA exam or lawyers the bar, similar codifying systems and frameworks must be put in place to regulate digital trust fiduciaries. Before we reach this point, however, policymakers must consider the many different, and sometimes conflicting, rules that govern the use of data across international boundaries. We need policy established not only at the national but international level if we are to develop standards that support the easy, secure flow of data around the world. And we need policy to subscribe to a shared set of requirements as much as possible. Without this, it will be difficult, if not impossible, to create a new role such as that of a digital fiduciary.
Given the size of the digital economy, and how complex it's rapidly becoming, the need to create this public-private partnership is already upon us. The growing penetration – and significance – of rapidly emerging technologies, such as AI, add to the growing trust gap and a need to bridge it. The imperative is quite urgent. The earlier we recognize this, the better off we all will be.