TrustTalk - It's all about Trust

Our guest in episode 81 is Dan Abrahams, a renowned sports psychologist, who delves into the mental aspects of sports. Dan emphasizes the foundational role of trust in both individual performance and team dynamics, explaining how it's as crucial in team sports like football and basketball as in individual sports such as tennis and golf. The discussion includes Dan's unique approach to mental skills training, tailored for athletes at all levels, and his innovative 'Game Face' concept, which assists athletes in achieving their optimal mental state for peak performance. Dan also touches upon the function of sports psychologists in premier football teams, with a particular focus on Ajax and Manchester United, detailing the importance of psychological strategies and trust cultivation in enhancing team performance. Additionally, the episode covers how breaches in trust can impact an athlete's performance and overall well-being, and the role of sports psychologists in rebuilding trust following major scandals. This episode is a must-listen not only for sports enthusiasts but for anyone interested in the psychological elements that drive success and effective teamwork.

Our guest today is Sim Sitkin, a Professor at Duke University, Durham (N.C.) He explores the intricate dynamics between trust and distrust, highlighting their distinct natures and the challenges involved in navigating these complex emotional states. He uncovers the nuances of how trust can vary incrementally across different domains, and contrasts this with the pervasive and often unyielding nature of distrust. He provides perspective on the vital role of values in shaping trust relationships. Through Sitkin's study involving a Dutch court, we learn how value incongruence between groups can lead to a breakdown in communication and trust, explaining the processes of rebuilding trust, and focusing on shared values and perspectives. Sitkin also touches on the role well-crafted control systems play in cultivating trust, drawing parallels from Ideo's approach, which harmonizes such systems with company ethos to reinforce trust. Furthermore, he provides insight into his forthcoming research, which seeks to consolidate the fields of trust and distrust into a unified theory. He emphasizes that competence alone is insufficient for trust to flourish, leaders must demonstrate benevolence and an understanding of their team's perspectives and values. He discusses the "tipping point" of trust, a critical juncture where accumulated missteps can erode trust beyond a simple fix, stressing the importance of early recognition and intervention to prevent distrust from becoming entrenched. Additionally, he touches on the impacts of immediate actions versus systemic changes on trust, the critical role of understanding in building trust, and the importance of relational leadership behaviors. Finally, we wrap up our conversation with a look towards the future. Sim Sitkin, alongside colleagues, is pioneering a general field theory to integrate research on distrust, trust, and generalized trust, aiming to illuminate the future landscape of trust in our rapidly evolving world.

Our guest today, Stephen M.R. Covey, emphasizes the profound importance of trust in leadership. He believes that trust, once broken, can only be rebuilt through consistent and genuine behavior rather than mere words. Covey passionately advocates for a leadership style of "trust and inspire" as opposed to the traditional "command and control." In this approach, leaders need to embody attributes like integrity, credibility, and transparency. They should be the first to demonstrate the values they wish to instill in their teams. Furthermore, Covey makes a distinction between leadership and management. While management often pertains to processes and objects, leadership is about guiding and inspiring people. He posits that individuals do not want to be merely managed; they wish to be led, trusted, and inspired. To this end, Covey introduces the idea that leadership is akin to stewardship, highlighting responsibility over rights. This perspective calls on leaders, especially those at the CEO level, to view their roles as stewards who model behavior, extend trust, and inspire those they lead. Concluding his insights, Covey commends the TrustTalk podcast for amplifying the essential conversation around trust, underscoring its pivotal role in today's world.

In episode 78 our guest, professor Nick Wheeler, discusses several crucial aspects of international relations and diplomacy. He explores the concept of "reassurance summits" and the role they play in diplomacy, where leaders attending diplomatic summits seek reassurance and test whether the other side perceives their defensive actions as stemming from fear and insecurity rather than hostile intent. He challenges the conventional wisdom that leaders should only engage in face-to-face diplomacy when their interests are already aligned. He introduces the idea of "security dilemma sensibility" in international relations, challenging the notion that uncertainty inevitably leads to competition and distrust. He emphasizes the need for leaders to understand the defensive motivations of others and break the cycle of misperceptions to promote cooperation and trust. Nick Wheeler delves into the possibility of developing social bonds and trust in the absence of face-to-face interaction. Drawing from Randall Collins' work, he suggests that weaker social bonds can indeed be formed without physical proximity, particularly through textually mediated interactions. He highlights the importance of shared security dilemma sensibility and shared mood in this context. He shares a cautionary tale from Dostoyevsky's "The Brothers Karamazov" to illustrate the limits of trust in transactional relationships. He argues that trust based solely on individual calculations of benefits and risks can quickly erode when the context changes. Shifting his focus to India-Pakistan relations, Wheeler examines the trust dynamics between leaders like Vajpayee and Sharif, emphasizing the importance of "trust, capacity, vulnerability" in assessing whether leaders can fulfill their promises and commitments. He also highlights the complexity of trust and opportunism in adversarial relationships. The discussion continues with an exploration of the role of interpersonal dyads in changing conflict situations. Wheeler underscores the significance of leaders being able to deliver on their commitments and the challenges of scaling up trust beyond individual relationships. He emphasizes the need to embed trust within decision-making processes and society itself to address future uncertainty. Finally he touches upon his upcoming book with Marcus Holmes, "Personal Chemistry: Social Bonds and International Conflict." The book aims to demystify the concept of personal chemistry in international relations by developing a theory that explains why leaders sometimes establish positive interpersonal relationships and sometimes do not. Through case studies, they aim to shed light on the factors influencing leaders' relationships and trust dynamics in diplomacy and conflict resolution.

Our guest today is Nicole Gillespie. She is the KPMG Chair in Organizational Trust and Professor of Management at the Australian University of Queensland Business School and an International Research Fellow at the Centre for Corporate Reputation at Oxford University. In the podcast interview, we cover various aspects of trust. She begins by addressing the challenge of translating theoretical trust research into practical solutions, noting that academia often values theoretical contributions over solving real-world issues. To bridge this gap, she advocates for interdisciplinary research that tackles critical trust problems and suggests collaboration with industries and non-governmental organizations. She also highlights the importance of practitioner-oriented journals to make research accessible. Nicole notes the emergence of a trend towards valuing research impact and relevance in academic work, particularly with interdisciplinary efforts addressing significant challenges. Vulnerability's role in trust is another key topic. Nicole emphasizes that trust involves a willingness to be vulnerable based on positive expectations. Trust is most pertinent in uncertain and risky situations. An interesting paradox arises where high-trust relationships create a subjective sense of security while making individuals objectively vulnerable. She highlights the importance of understanding vulnerability's bright side, including its role in fostering connections, innovation, and resilience. The interview further delves into the challenges of establishing trust across cultural boundaries. Gillespie co-authored a paper exploring trust dynamics between German supervisors and Chinese supervisees. The research highlighted the clash of cultural expectations, particularly regarding hierarchical relationships. Chinese employees often entered with high initial trust due to cultural expectations, while German supervisors focused more on task-oriented dynamics. The misalignment led to disillusionment and challenges in maintaining trust. Lastly, Gillespie touches on the significance of trustworthy AI. She was part of a paper outlining a model for ensuring trustworthy AI. While acknowledging the rapidly evolving landscape of AI, she explains the six dimensions of the model: organizational alignment, data integrity, system robustness, security, legal compliance, and ethics. Gillespie emphasizes the need for a comprehensive approach, integrating these dimensions to ensure responsible and trustworthy AI use. The interview concludes with a focus on the future of trust research. Gillespie highlights the evolving nature of technology, particularly AI, and its impact on trust relationships. She suggests exploring how emerging technologies affect trust dynamics, polarization, and societal relationships. As she commends the podcast host for his dedication to discussing trust-related topics, Gillespie underscores the importance of continuous research and dialogue in understanding and maintaining trust in an ever-changing world.

Our guest, Tom Tyler, a psychologist, and professor at Yale Law School, highlights the paradox in the legal academy, where much of the law is dependent on beliefs about psychology, yet it is seldom based on actual psychological research. Tom mentions the significance of trust in the legal system and its central role in discussions within law schools and the field of law. They emphasize that trust is a crucial component of legitimacy and that the ability of the legal system to function effectively relies on the trust the public places in legal institutions. He explains that historically, the legal system relied on a sanction-based model, threatening punishment to ensure compliance. However, behavioral science research has shown that building trust between the public and legal authorities is a more effective approach to gaining compliance and cooperation. Trust allows for a more cooperative relationship between the population and law enforcement, leading to an increased willingness to cooperate, provide information, and engage with the community, which aids in crime control. The concept of procedural fairness plays a significant role in building trust in legal authorities. People want to be treated with dignity, respect, and have decisions and policies explained to them. Research suggests that procedural fairness is more important in determining trust in authorities than the actual outcomes of their decisions. Additionally, trust is not solely about neutrality and rule-based procedures, but also encompasses relational aspects, such as sincerity, benevolence, and taking into account the needs of the people being dealt with. Tom argues that trust in legal authorities leads to not only compliance but also contributes to building the viability and strength of communities. A trust-based system promotes engagement, social connections, and active participation in community governance and activities. This, in turn, can reduce the need for constant surveillance and policing, making the community more self-regulating and self-sustaining. He notes that implementing procedural justice in policing and courts has shown positive outcomes in various communities. Improving the internal climate of law enforcement, as well as how officers are treated by their superiors, can positively impact how they treat the public, ultimately leading to enhanced procedural fairness and trust in the community. Furthermore, Tom argues that procedural justice is a widely accepted and agreed-upon concept across different ethnic, cultural, and economic groups. It is seen as a universal feature that fosters trust in legal authorities. While primarily studied in advanced industrialized societies, the principles of procedural justice have been found to hold true in various contexts.

Our guest today is Tom Van der Meer, a political science professor from the University of Amsterdam. He's an expert in political trust, social connections and voting patterns. Tom highlights the historical importance of political trust since post-World War II. He explains that the idea of a continuous decline in trust isn't entirely accurate. Trust levels vary across regions and times. He shares an interesting idea when people lose trust due to poor government performance, it might actually motivate them to get more involved in a democracy like voting and protesting. This can lead to positive change. Tom also explores what shapes political trust. He breaks down reasons like fair institutions, electoral systems, and education's impact. He discusses the link between corruption and trust, showing how corruption hurts trustworthiness and the importance of fairness in countering it. Tom talks about how politicians talk about trust and the connection between populism and political trust. He points out that the two aren't always directly linked, but trust affects how people vote and which parties they support. When asked about Francis Fukuyama's view on populist politicians and distrust in institutions, Tom partially agrees but adds nuance. He challenges the idea that populism always arises from declining trust, pointing out examples like modern populism emerging in high-trust countries. He also notes that the connection between rising populism and decreasing trust isn't always direct, as events and trust fluctuations don't consistently match Fukuyama's theory. Tom does share agreement with Fukuyama on the growing politicization of political trust. He observes that voters now choose parties based on trust levels a change from the past, where Trusters and Distrusters often voted for the same parties. Tom highlights the role of polarization and ideology in shaping party dynamics. He's concerned not just about overall trust levels, but also how trust is distributed across parties. He warns that parties dominated by distrusting individuals could lead to challenges like questioning election legitimacy, as seen in the United States.

Our next guest, Lee Rainee, director of the Pew Research Center’s Internet & Technology Research Group, delves into the subject of trust in the context of the Internet and institutions. He identifies two key aspects of online trust. Firstly, a decline in trust, particularly concerning major technology companies and institutions. People have become increasingly skeptical about the privacy and reliability of these entities. This decline is further exacerbated by the interplay between privacy concerns, trust issues, and confidence in institutions within the online space. However, despite the declining trust, he argues that people are unlikely to disengage from online activities. The internet has become deeply integrated into modern life, and essential tasks, such as banking and shopping, heavily rely on online tools. People have grown dependent on the convenience and efficiency offered by internet-based services, even if they express reservations about trusting the companies providing them. The conversation also explores several contributing factors to declining trust. Historical events, such as the Vietnam War, Watergate scandals, and economic recessions, have eroded trust in institutions over time. The internet has amplified these trends by providing access to information about institutional shortcomings, fuelling suspicions and concerns about trust. Political polarization is another influential factor. The rise of right-wing nationalist organizations, combined with politics becoming a divisive battleground, has led to heightened mistrust among citizens. Additionally, frustrations arise from the perception that governments are inept in addressing major societal challenges, such as climate change, misinformation, and the pandemic. Notably, trust is portrayed as a transactional calculation. Individuals weigh the potential benefits of an interaction against the compromises it might entail. Trust, in this context, becomes context-specific and contingent on various factors, reflecting a complex interplay of motivations and perceptions. Lee discusses the research methodology employed to study trust. Given the declining response rates to phone polls, online surveys have become more prevalent. Ensuring representative samples is crucial to obtain accurate insights into trust levels. However, some individuals distrust survey-givers, which may lead to incomplete data representation. He discusses the echo chamber argument, where people seek information that aligns with their views, but his data shows that highly motivated partisans from both the activist left and right actively engage with diverse information, including opposing views, to strengthen their arguments and understanding of the political landscape. Partisanship, civic engagement, and commitment to the political system play a significant role in determining the information people seek. The interview touches upon the role of academia and research in understanding trust. Different researchers focus on various aspects of trust, ranging from political culture and democratic institutions to corporations and macroeconomics. Understanding the complexities of trust in its various forms and contexts remains an ongoing area of exploration.

Our guest, Peter Dinesen, Professor of political science at UCL London and the University of Copenhagen talks about the consequences of immigration on generalized social trust. In his research, he explores if immigrants bring low levels of trust from their home countries or adapt to the trust levels in their new countries. And if natives respond to the increased presence of immigrants with lower levels of trust. Immigrants tend to catch up to the trust levels of natives in their new countries, while there is evidence of a weak negative effect of the presence of immigrants on trust levels among the native-born. However, Peter cautions against exaggerating the negative consequences, as other factors such as low corruption play a more significant role in trust. This is illustrated by trust increasing to record levels in Denmark since 1980 despite increasing immigration to the country.

Kevin Werbach, professor of Legal Studies and Business Ethics at the Wharton School, University of Pennsylvania, and formerly Counsel for New Technology Policy at the U.S. Federal Communications Commission, is a well-known expert on the business, legal, and social implications of emerging technologies. In this interview, we explore blockchain technology and its impact on traditional notions of trust. He delves into the different architectures of trust, including peer-to-peer trust, Leviathan trust, and intermediary trust, highlighting the limitations and risks associated with these traditional forms of trust, leading to the introduction of decentralized architecture offered by blockchain technology. The interview focuses on the application of blockchain in enhancing trust in specific contexts, using the example of Walmart implementing a blockchain-based solution to improve food safety within its global supply chain. The guest speaker emphasizes how blockchain can overcome trust barriers and inefficiencies, leading to enhanced trust and improved outcomes. The conversation also delves into the potential of blockchain technology to bring about freedom from corporate and government power, while acknowledging the risk of empowering criminals. Kevin highlights the importance of blockchain as a part of rebuilding trust in society, by providing transparent and decentralized systems for verifying information and maintaining integrity. He sets out the value of cryptocurrencies, bitcoin, with an emphasis on how blockchain technology provides trust through the integrity and transparency of the ledger. The interview concludes with a discussion on the viability of blockchain technology, the collapse of centralized platforms like FTX, and the comparison between the telecom industry and blockchain.

Podcast Notes. Here I add who i meet what the siubject etc

In this episode nr. 71, Eric Uslaner, in his latest book, “National Identity and Partisan Polarization” delves into the complex topic of trust and its implications for societies and politics. He highlights some key insights and concerns regarding trust, corruption, nationalism, and their interconnections. Throughout the interview, we explore the moral basis of trust, it lies in the belief that people of different backgrounds can trust each other based on shared interests, regardless of ethnic, religious, or ideological differences. This belief instils the notion of equality and is typically learned from parents at an early stage of life. Trusting individuals are more likely to engage in charitable giving, volunteerism, and compromise in both personal and political spheres. However, the current climate of political polarization runs counter to the concept of generalized trust. The level of trust in a society is strongly influenced by the degree of economic equality. Corruption tends to thrive in societies with low levels of trust and high levels of inequality. In highly corrupt environments, resources for public goods such as education and healthcare are diminished. Moreover, individuals in such societies often prioritize their own well-being and may support corrupt leaders from their own group. Punishing corrupt individuals alone is insufficient, as new corrupt actors will likely take their place. The guest emphasizes that reducing corruption requires widespread public education. The rise of nationalism globally signifies a decline or stagnation in trust. Nationalism reflects particularized trust, where individuals trust only those who are similar to them. It often entails perceiving those different from oneself as threats to the desired social order. Countering the rise of nationalism is challenging and requires long-term efforts, including education and generational change. Political trust presents a similar challenge, as opposing sides tend to view each other as enemies. Our guest expresses concerns about the growing nationalism trend worldwide. Notably, Sweden, a country known for its tolerance, experienced the rise of nationalist parties advocating for stricter immigration policies and emphasizing divisions between natives and foreigners. The United States has also seen immigration become a major political concern. Troublingly, in some cases, immigration opposition gained more support for certain political parties than they lost on other issues such as abortion. The rise of nationalism presents complex challenges without immediate solutions. Throughout our conversation, we explore the multifaceted nature of trust, its relationship with corruption and nationalism, and the difficulties associated with addressing these issues. The guest's insights shed light on the dynamics shaping trust in societies today.

Our guest today is Marguerite Soeteman-Reijnen, former Chairman of the Executive Board of Aon Holdings B.V. and member of SER Topvrouwen. She tells about her journey to her current position and her interest in supporting and encouraging women in leadership roles. She emphasizes the importance of trust in her career success and the success of the organizations she has led. Trust is particularly significant in the insurance industry, where she started her career, as it is based on the principle of ultimate good faith. Marguerite explains that building trust involves logic, empathy, and authenticity. She believes that trust is crucial in relationships and leadership and highlights the role of trust in women's leadership. The interview also discusses a study that suggests women are less prone to losing trust and more likely to regain trust even after repeated transgressions. Marguerite attributes this to women's optimism and relationship-driven nature. However, she notes that personal experiences and the frequency of trust violations can influence individual responses. When it comes to balancing trust and empathy with making sound business decisions, Marguerite mentions the importance of trust but verify approach. She emphasizes the need to gather all relevant information, maintain competence and confidence, and have realistic self-awareness. Building trust with underrepresented groups requires leaders to foster an inclusive and belonging culture. In her former role at Aon Holdings, trust is vital in providing risk and insurance solutions to clients. We talk about a recent report on sexually transgressive behavior in a TV show and the importance of independent and unbiased investigations to maintain trust. She offers advice to young women aspiring to leadership roles in underrepresented industries, the importance of continuous learning, asking questions, making oneself visible, and believing in oneself.

In this new episode, we explore the fascinating world of trust and cooperation in economics with economist Professor Benjamin Ho, author of "Why Trust Matters, An Economist's Guide to the Ties That Bind Us." He discusses how game theory offers insights into trust, highlighting the role of reputation, history of interactions, and vulnerability in building trust. He also explores the use of social signaling and mathematical principles in understanding trustworthiness, particularly in relation to apologies using Bayes' rule. The interview delves into the puzzle economists faced in explaining cooperation and altruism, emphasizing that most people are inherently cooperative, except for economists who are trained to be self-interested. The importance of cooperation, fairness, and altruism in human nature and society is highlighted, drawing from Robert Frank's book on the baseline economic model. Early hunter-gatherer societies faced the trust dilemma and developed accounting systems, language, and legal systems to facilitate trust and cooperation as communities expanded. The complexities of apologies are examined, emphasizing the need for them to carry a cost or commitment to be effective. The experiment involving Bill Clinton's apologies showcases the trade-offs between likability, respect, and authority for politicians. The cost associated with trust-building, such as in apologies, is emphasized, with costly apologies proving more effective in restoring trust. In cooperative dilemmas like climate change, trust plays a crucial role, as coercion is impractical at the international level. The Paris Climate Accords' approach of transparency to foster trust, accountability, and positive behaviors is discussed. The relationship between trust and contract enforcement is explored, noting that while trust and contract enforcement often go hand in hand, excessive rules in contracts can hinder trust-building by limiting vulnerability and risk-taking. The importance of including trust-building mechanisms in economic development is emphasized, as the absence of trusted institutions hinders poverty alleviation and overall progress. The interview sheds light on the significance of trust in economics, drawing from game theory, behavioral economics, and historical perspectives. It underscores the role of trust in cooperation, apologies, climate change, and contract enforcement, and emphasizes the need to prioritize trust-building in educational curricula and economic development efforts.

Our guest is Peter van Keulen, a prominent lobbyist in The Netherlands. He talks about trust as a fundamental aspect of lobbying, and the importance to establish and maintain it through transparency, integrity, and access. He discusses the essential elements for building trust in lobbying, namely integrity, and access. Integrity is demonstrated through a code of conduct that outlines how lobbyists protect their clients' interests and how they act towards the people they seek to influence. Access is the ability to interact with decision-makers due to relationships built over time. While knowing decision-makers does not guarantee success, it can be useful. In the United States, lobbyists must register and disclose certain information about their activities under the Lobbying Disclosure Act of 1995. In Europe, regulations have been introduced, but they vary by member state, and The Netherlands has been slow to regulate lobbying. The European Commission has rules in place that prohibit former commissioners or high-level professionals from acting as lobbyists for a specific party for a specific period after leaving their position. However, there are still stereotypes and misconceptions about lobbying that can impact the perception of the profession as a whole. When people view lobbyists as only representing big corporations or having questionable motives, it can be challenging to establish trust. That's why it is crucial to educate the public and policymakers about the diversity of actors involved in lobbying and how it operates to foster trust and create a more positive image of the profession. Ultimately, building trust is an ongoing process that requires open and honest communication and a commitment to ethical practices. NGOs, governments, and municipalities also engage in lobbying activities, and the growth of lobbying activities in the Netherlands is in the municipalities and provincial decision-making levels. By promoting transparency, integrity, and access, lobbyists can build and maintain trust with decision-makers and the public.

Our guest today is Alison Taylor, clinical associate professor at New York University Stern School and Business Executive Director of Ethical Systems, a non-profit research collaboration focused on bringing the best ideas on business ethics from academia into the corporate sector. She has had a diverse career working in corporate investigations in emerging markets, leading her to question the role of culture and leadership in businesses. Her background in political science, history, and organizational psychology has given her a unique perspective on business ethics. She believes that society has lost consensus on what it means to be a good business and her upcoming book aims to clarify this confusing debate. She argues that organizations should focus less on rules and compliance programs and more on building ethical decision-making capacity. They should bring in the wisdom of the collective and have debates about gray areas to jointly make decisions based on the collective's wisdom. Rather than treating ethics as a fundamental black-and-white issue, she suggests building thoughtful capacity for ethical reasoning among the workforce and in society in general. We talk about Elon Musk's decision to lay off the director of Ethics, Transparency and Accountability at Twitter, she believes that he may have underestimated the complexity of content moderation and is now facing the consequences of his decision. She raises the topic of transparency and questions the notion that more transparency leads to more trust in businesses, despite the increase in the level of information available about corporate conduct over the past two decades. She argues that that businesses need to change how they think about ethics and be more transparent and honest, while also being more restrained in what they promise to achieve. She suggests corporations should have a more focused strategy on what they can and cannot solve and stop exaggerating and spinning a story to deflect scrutiny. Finally, she explains how leaders can navigate ethical dilemmas and make decisions in the best interest of their organization.

Our guest today is Jan van der Spoel, the author of "360 Degrees Trust." His approach, known as the Trust Compass, can elevate ordinary relationships into high-trust ones. During our interview, Jan discusses his background in graphic design and how his fascination with human behaviour led him to explore the concept of trust. He also shares how he created his own tools to better understand the challenges of achieving a consensus on trust. Jan then goes on to outline the top three things that organizations can do to foster team spirit through trust: intent, system, and power balance. He stresses that all three are critical in building a team that trusts one another. Furthermore, he explains that control is the antithesis of trust and details how organizations can transition from a culture of control to a culture of trust. Jan recommends providing employees with professional freedom and setting clear expectations instead of micromanaging them, as studies show that this approach can be more effective in motivating employees than having a task-based manager watching over their shoulders.

Our guest today is Esther van Zimmeren, Professor of Intellectual Property Law & Governance at the Faculty of Law of the University of Antwerp and coordinator of the Centre of Excellence GOVTRUST. The connection between trust and the legal profession is not a simple one. In legal literature, the concept of trust typically pertains to confidence in (legal) institutions, such as courts, judges, or "the legal system." Legitimacy is often used as a synonym for trust, despite its unclear relationship with trust in broader literature from other disciplines. The terms trust, rule of law, and legitimacy are used interchangeably without specifying their drivers or consequences, leading to a lack of clarity in their practical implications. Esther discusses the challenges of creating trust in contractual arrangements, particularly in complex IP licensing and patent pool agreements. They explore the balance between creating clarity and legal certainty while leaving room for innovation and open communication to build trust. She suggests that clear milestones can be imposed at the beginning of the contract, but renegotiation and mediation can be used when more space is needed. The use of alternative dispute resolution, such as mediation, can help to maintain good long-term relationships and build trust. She highlights the importance of considering the context in determining the effectiveness of rules and contracts. They suggest that differences in outcomes may be related to variations in empirical research and theoretical work, as well as factors such as the type of collaboration, contract, actors involved, and geographical scope. Esther van Zimmeren believes that legitimacy, fairness, and procedural justice are important considerations for trust in an organization or institution, especially in a regulatory governance context. She talks about the Unified Patent Court in Europe, which has promising rules for fairness and impartiality but faces challenges in terms of the independence of its technically qualified judges who work part-time for patent firms. She emphasizes the need to look at specific examples rather than general concepts when discussing trust in the legal system.

Our guest today is Emily Frolick, lead partner of KPMG’s "Trusted Imperative", a new, proactive, strategic approach to risk management that creates a powerful platform for growth and innovation. By inspiring trust in customers, investors, employees, suppliers, communities and regulators, businesses can achieve sustainable advances in performance and efficiency. She talks about the different risks that companies face, including regulation, technology disruption, brand reputation, environmental factors, and cyber risks. In the area of digital transformation, she notices significant changes to businesses, from moving key functions to the cloud to creating new digital offerings and ways to not overlook the role of trust. She talks about a cultural change project by KPMG, conducting interviews and workshops with key stakeholders to identify challenges and desired outcomes, leading to a better understanding of the steps needed to create a culture of trust and accountability.

Today’s guest is David Dunning, professor of psychology at the University of Michigan - known from the "Dunning-Kruger effect" - who focuses in this interview on the psychology underlying human misbelief. In the interview, we talk about what is going on in the human psyche that's allowing people to trust, and why people trust other people when, according to the economics of rational analysis, they shouldn't. Trust often turns out to be not really an economic decision. When you go to a doctor there's a norm that if your doctor says X, unless you have excellent reasons to ignore him, you should go with the doctor’s advice. Trust is crucial not just for established relationships. It’s also especially vital between strangers with no responsibility toward each other outside of a single interaction. Psychologists found “excessive” trust rates rising much higher than anticipated, given people’s aversion to risk and rather cynical expectations of their peers’ trustworthiness. Many trust even though they expect their trust not to be honored. David is most well-known for the Dunning-Kruger effect when a person's lack of knowledge and skills in a particular area causes him to overestimate his own competence. We talk about the 1986 negotiations between Reagan and Gorbachev, both walked away from a potentially historic agreement that would have eliminated nuclear threats. They famously walked away from a deal because they couldn't get themselves to trust one another.