Warren Buffet famously once said: “It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.”
Data holds significant power in the contemporary digital economy. It is changing the competitive landscape and the ability to collect and effectively use large amounts of data gives companies a competitive advantage.
But with that opportunity comes risk and responsibility. When it comes to customer relationships, data responsibility is the price of admission and converting data into value, securely and ethically, is the business imperative for the next few years, at least. Trust, and specifically the concept of “digital trust”, has become fundamental to an organisation’s growth strategy.
To learn more, visit OneTrust.com
It takes a lot of effort to establish trust with customers and other stakeholders and it can be lost in an instant. With that in mind, TechCentral hosted a recent webinar – sponsored by OneTrust – to unpack the notion of “trust”, its benefits and business impact, and to share thoughts on achieving trust in practice. Watch the full webinar on demand below.
A valuable currency in today’s digital economy
Technological progress has presented us with abundant opportunities. From artificial intelligence and big data to cryptocurrency and blockchain, we are constantly encountering imminent technological revolution, transformative developments and fundamental shifts in our way of doing things.
At the same time, we live in a time where “digital trust” – defined as confidence in an organisation to protect consumer data, enact effective cybersecurity, offer trustworthy products and services and provide transparency around AI and data usage – is at an all-time low.
The inherent trust that exists in the physical world – because we can see and know who we are interacting with – has not been replicated in the digital world. Because of this, it is imperative for businesses to demonstrate that they are trustworthy for their stakeholders – customers, suppliers, partners and employees alike – to gain a competitive advantage in an age of digital transformation.
Firstly, trust is a vital factor in building strong customer relationships. When customers trust a business, they are more likely to remain loyal and continue to engage in repeat purchases. Trust fosters customer satisfaction, as it creates a sense of confidence in the quality, reliability and integrity of products or services. Satisfied and loyal customers contribute to increased sales, positive word-of-mouth referrals and long-term profitability.
Watch the webinar
Secondly, trust is essential for fostering collaboration and establishing partnerships with other businesses or stakeholders. When organisations trust each other, they are more likely to engage in mutually beneficial collaborations, joint ventures or strategic alliances. Trust facilitates sharing resources, knowledge, and expertise, leading to innovation, increased market reach and shared success.
Lastly, trust is also a critical element in building a positive work culture. When employees trust their organisation’s leadership, colleagues and processes, they are more engaged, motivated and committed to their work. Trusting environments promote open communication, collaboration and transparency, which can boost productivity, creativity and employee satisfaction. Additionally, organisations that prioritise trust are more likely to attract and retain top talent.
In an increasingly “online” economy, trust gives businesses a significant competitive edge. In today’s crowded marketplace, where consumers have numerous choices, trust can act as a differentiator and attract customers who prioritise integrity and reliability when making purchasing decisions.
The role of risk management, security and compliance in establishing trust
One of the most transparent ways for organisations to demonstrate digital trust is to establish a foundation of effective regulatory compliance, demonstrating that they maintain the integrity of systems, protect sensitive information, and ensuring ethical and legal practices.
- Risk management: This involves identifying, assessing and mitigating potential risks that may impact an organisation’s operations, reputation or stakeholders. By proactively addressing risks, organisations demonstrate their commitment to safeguarding the interests of their stakeholders by preventing disruptions, financial losses or reputational damage.
- Security: Organisations must implement robust security measures to prevent unauthorised access, data breaches, cyber-attacks or other security incidents. When stakeholders observe that an organisation has invested in strong security protocols, they are more likely to trust the organisation with their personal information or business transactions.
- Compliance: Organisations that demonstrate compliance with laws, regulations and industry standards build trust by showcasing their commitment to ethical behaviour, fairness and responsible practices.
The role of privacy, third party risk management and ESG in maintaining trust
By taking an integrated and strategic approach to risk management, security, and compliance, organisations establish a foundation for success when trying to establish trust. But the ecosystem is more complex than this. The relationship between companies and consumers has undergone a radical transformation over the past several years. Consumers expect customers to reflect their values, engage with them as partners and keep their private information private. This is where the role of privacy, third party risk management and ESG becomes critical to establishing trust.
- Privacy: In an increasingly data-driven world, individuals are concerned about the security and handling of their personal information. By prioritising robust privacy practices such as secure data storage, transparent data handling practices, and obtaining informed consent, organisations demonstrate their commitment to protecting the privacy rights of their customers, employees and partners, instilling confidence and providing reassurance that personal information will be handled responsibly.
- Third-party risk management: In today’s interconnected business landscape, organisations often rely on third-party vendors, suppliers or partners to fulfil various functions. However, these relationships come with inherent risks that can affect the organisation and its stakeholders. By implementing effective third-party risk management practices, organisations can demonstrate their commitment to protecting stakeholder interests.
- Environmental, social and governance: By prioritising ESG practices, organisations establish trust by aligning their actions with the broader interests of society. Ethical practices, such as promoting diversity and inclusion, respecting human rights and ensuring fair labour practices, build trust with employees, customers and communities. Environmental responsibility, including reducing a carbon footprint, conserving resources and supporting eco-friendly initiatives, showing a commitment to a sustainable future. Moreover, robust governance practices, transparent decision-making processes and accountable leadership contribute to building trust.
Trust complements governance models and operationalising this concept is critical to bringing efficiency gains and maybe even competitive advantage. Nonetheless, determining how to build trust can seem complex and overwhelming for many organisations, especially those that don’t have an established trust programme. As a starting point to helping organisations establish and exhibit trust, it is essential to build the principles of privacy, security, risk and compliance by design into technology stacks from the moment development begins. When companies meet all the conditions for good data governance and data management, they set the foundations for establishing trust through data ethics. As companies continue to grow and evolve into the enterprise landscape, they can then focus on building more dedicated risk management and security functions to maintain ongoing trust.
Embracing the trust dynamic presented by the digital economy is not insurmountable. It is a journey of proactive and holistic risk management that leads to sustainable business growth. It is entirely possible for organisations to earn trust, comply with regulations and policies and to get the insights needed to deliver the personalised experiences that move customers and business forward.
OneTrust is the category-defining enterprise platform to operationalise trust. More than 12 000 customers, including half of the Fortune Global 500, use OneTrust to make trust a competitive differentiator – implementing central agile workflows across privacy and data governance, GRC and security, ethics and compliance, and ESG and sustainability programmes. To learn more, visit OneTrust.com.
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