How do you rebuild trust: whether in Banks, BBC, the Internet or a Regulator?

The Newsnight debacle and the impending libel actions have not only dented trust in the BBC but also in the Internet as a source of reliable information on what is being kept from us and where comment is free. The challenge of Guido Fawkes to the Information Commissioner’s appeals tribunal refusal to order the release of the list of those present at the BBC Climate change workshop which decided to replace impartiality by a “policy“, by publishing it anyway also raises interesting questions of trust in the regulatory regimes for both Freedom of Information and Draft Protection.  

So how is trust rebuilt, once lost? A couple of days ago I blogged on the attempt by Nominet to rebuild Trust in .uk . I apologise that the blog was a bit long but it provoked a robust (and even longer) response from Paul Keating, retained to attend the consultation meetings to oppose the proposals. Do read his comments. You will better understand why I regard the topic as so important – and not one to be left to those whose business is the sale of domain names.

Last week I printed one of the more technical responses to my note of the planned competition for students on how we rebuild trust in the on-line world. Below is the response from the Head of Risk in the London offices of one of the world’s largest banks. 

I hope you are not offended by what I am about to say. I think the paper misses the essential point; the moral compass has been eroded from Government, Business leaders, the press and the general public.

Now we seek technical solutions to a human problem. I am afraid that it will fail. We have email surveillance, market abuse monitoring systems, recording of voice and electronic transactions and of IM  and email traffic. We also have insider trading laws, personal data protection laws, corporate theft laws and internal audit, external audit, operational risk teams and multiple global regulators.

In my working day I often here words such as “if IT Risk and Control haven’t defined a policy then I don’t have to do anything/it is ok to carry on doing what I am doing”.  So, responsibility is passed to someone else (or so they would have it). Best practice, risk assessment,  20 years of experience count for nothing unless they are told explicitly how to behave.

If the proposed program goes ahead as set out I fear further abrogation of responsibility.

For the same reason I am not in favour if ever more regulation. We already have enough laws and regulation. The onus is taken away from individuals. Wrong doers need to know that they will be punished and ultimately end up in jail. Proper enforcement of existing laws is what is needed.

But what of root cause? I am afraid we have to go back to basics and start with the young and education. Honesty in business and life. Corporate Social Responsibility to the community and the environment.  Re-establish the moral compass and explain that instant fame and fortune is not the norm or a reasonable expectation. Honesty and hard work will bring their rewards. We knew how to do it once –  education, competition in sport (be a good sport, you don’t always win), respect others.

Happy to discuss further.

My Word Is My Bond. Let’s get back to it.

I was not in the least offended. Yesterday we heard some of the UK largest on-line operations explaining why they pay little or no tax in the UK. The reasons are not new. What is new is the attempt by a new generation of global multi-nationals to defend what was indefensible thrity years ago. When I was Corporate Planner in the early 1980s one of my more interesting tasks was to quietly re-write a global management accounting systems because our transfer pricing systems had become so complex that one of our trusted overseas accountants (who had been instructed by his own government to check they were getting a fair tax take) warned us they were being used to conceal insider fraud.  He was right.  Not only we were able to remove a fraud costing a quarter of our global profits, we had the evidence to ensure that politicians, regulators and tax authorities around the world could be shown they were getting approximately the same percentage of local sales as a tax take – although the mix (sales tax, corporation tax, payroll tax etc.) might be very different. That was one of the reasons why The Wellcome Foundation (not the Wellcome Trust whose main role was to administer the endowments for UK University Pharmacology Departments to train researchers for the Foundation) was globally trusted in the way that most modern companies are not. When I joined I was told that very firmly by my Director that our century old reputation for trust (from rigorous testing and quality control to commercial negotiaton) was a more valuable asset than the patent portfolio over which others might obsess. I soon discovered he really meant what he said. Over time I discovered how right he was. 

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