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Globalization: the crisis of trust and how to solve it
Published May 26, 2025 in Leadership • 7 min read • 
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In an I by IMD interview, Ros Taylor, author of The Future of Trust, explores how the nebulous nature of globalization has fractured trust in institutions and triggered a renewal of faith in the individual.
I by IMD: What has caused today’s crisis of trust?
RT: There have been many crises of trust in the past, so this is not unprecedented. However, the way it’s playing out is new. Globalization means that, as an individual, you need to trust many more companies, institutions, and people than you did before because your contacts with the outside world are multiplied and spread geographically and culturally wider. You have to trust things you have never seen and may only have a very abstract idea about. That is a characteristic of the 20th century and the beginning of the 21st century. There is an increasing number of institutional bodies we need to trust to go about our daily lives – institutions we cannot fully understand. There is a backlash against that, which was accelerated by the pandemic: it demanded a massive amount of institutional trust, which people struggled to deal with.
How does this erosion of trust in institutions play out?
An example is rail companies in the UK. Once, it was just British Rail – one state-run organization. Now [since privatization in the 1990s], there are multiple rail companies that may or may not be accountable to the government (you’re not entirely sure how and how much), plus a track system and stations all run separately. There is no sense of a coherent institution looking after the railways and working to run them in the most efficient way. What we see as a result is a turn away from trusting institutions and a turn toward interpersonal trust, which is less open to scrutiny but simpler and easier to understand. You could regard the return of Donald Trump [as US President] as an example of a desire to cut through the need for institutional trust and to put one’s trust in an individual who promises to take away the complexity. That speaks to our desire for interpersonal trust and how novel institutional trust is in terms of human development and civilization – how rapidly it has grown and how ill-equipped we are to deal with the cognitive and intellectual demands. Interpersonal trust is something we are almost programmed to do. Making the switch and saying institutions are more important than individuals is hard for the human brain.
Why is interpersonal trust such a powerful force?
Interpersonal trust is key to the human experience and a necessary part of primitive early societies. People had to trust each other when they only knew a limited number of people and only occasionally traveled beyond where they lived. Before people lived in towns and cities, interpersonal trust was at a premium. Then, gradually, there would be manageable elements of institutional trust – for example, loyalty to a sovereign you didn’t see but knew.
Why are some people more comfortable than others with institutions?
They see how they fit into modern society and feel comfortable with their position. They don’t see institutions as a threat to their prosperity. Those institutions may be an important part of what they do. If you’re not part of that world and you don’t see how you fit into it, it’s more difficult. You don’t have a stake in that institution. You don’t see how you relate to it. It is something that operates, as far as you’re concerned, in the shadows in a way that you don’t understand.
Have businesses contributed to the crisis of trust?
I don’t hold business particularly accountable for what has happened. Businesses often find it easier to negotiate this trust relationship because their relationship with customers is very transactional. It’s much simpler to grasp than my relationship with a government where I pay taxes. The decisions on what I should get from that government and what everybody else gets are something I have very little power over. However, businesses need to understand that there’s a premium on interpersonal trust. People are turning back toward it and beginning to prefer it. People put a premium on the ability to talk directly to a business – with the move to bots and virtual assistants and the reluctance to invest in call centers, that creates problems for businesses. I don’t think many companies have quite grasped that. If you can provide some kind of interpersonal relationship and build interpersonal trust, your customers will probably be happier. That feels like a good idea, given where trust is going.
“It will benefit businesses to be more transparent and establish what makes their company different. What makes them more trustworthy? What identity do they have? That’s more than just branding; it is what the CEO and the organization’s leaders say and how they behave. ”Ros Taylor
How can leaders foster greater interpersonal trust?
They can make it clear why they’ve taken certain decisions and be as straightforward as possible about that: to be more transparent about their motivations and actions. What are an organization’s ultimate motivations apart from making money? Where are its red lines? It will benefit businesses to be more transparent and establish what makes their company different. What makes them more trustworthy? What identity do they have? That’s more than just branding; it is what the CEO and the organization’s leaders say and how they behave. People are more alert to wrongdoing and bad behavior, particularly among senior people in organizations. Unfortunately for those leaders, they can’t separate themselves from the institutions they work for. It will become more important for executives to personify the values their brand claims to stand for because it’s the only way people can get a sense of what the organization is for and what it believes in. Otherwise, with the proliferation of institutions and companies, it becomes too difficult for a human brain to take in all the competing institutions that they should trust or are required to trust. The interpersonal element will have to play a much bigger part, though I suspect some leaders will dislike that intensely.
What are the implications of the rapid development of AI?
There’s a real danger of it becoming an enormous problem. It may become its own kind of institutional trust problem. People who understand how it benefits them will be perfectly happy. People who see only that it’s taking away their livelihood or something they value and replacing it with something inferior will not. The sheer unknowability of AI puts it almost in a different league from other kinds of trust. There’s an example I give in my book that the algorithms used to power AI are so complicated that you can’t expect a jury in a regular trial to be able to understand them. So, who can judge whether they are fair or not? There are decisions about who is entitled to state welfare benefits, for example, which AI is increasingly making which will affect people lower down the income scale, and the black box nature of it – the fact that it’s so hard to talk about is going to lead to a lot of distrust and potentially some quite violent opposition.
What are the best and worst scenarios for the future of trust?
Human beings have an enormous need to trust. Society can’t function at any level without trust. It certainly can’t function at a town, city, state, or international level without huge amounts of trust. In the worst case, we might be starting to lean toward a place where institutional trust becomes so difficult that people reject it, and that is the end of the globalized society as we understand it. The best case is that institutions do a better job than they have of explaining why they’re useful and necessary and in a language that ordinary people can understand. They start to behave in ways that foster trust and to understand the limits of their authority. It’s not been appreciated by many people, especially on the left, the degree of distrust that’s out there. There is an assumption on the left that the rule of law is a good thing, but that is a view increasingly not shared by people who want to cut through all that. They want a charismatic individual who can turn all that on its head and enable them, as they see it, to break free. That is a dangerous place to be, but the impulse should not necessarily be to say we need more laws. Instead, it should be to say: We have a lot of laws – have we done a good enough job explaining why we have them? Have we convinced enough people of their worth?
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