Acumen Edelman Trust Barometer 2024: Regulation and building trust in innovative technologies

In the pursuit of fostering innovation, business in New Zealand often finds itself encumbered by regulations that result in increased compliance cost and decreased productivity. As a result, innovation can struggle for air.

We know that our ability to innovate is critical to addressing our growth and productivity challenges and providing us a competitive advantage in global markets. However, the Acumen Edelman Trust Barometer has found that New Zealanders are distrusting of innovation – even more than our global counterparts such as Canada and Australia.

The Barometer has resurfaced the age-old tug of war between innovation and regulation. The research has found that no institution, whether it be government, media, businesses, or NGOs is trusted in New Zealand to integrate innovation into New Zealand society in a safe and effective way.

While no-one likes the thought of regulation, we know that its existence is a mitigating factor for adopting public trust in innovative technologies. When participants were asked what government could do to increase their trust in innovative technologies, the top three factors identified were, instituting safeguards (such as regulation), along with communicating the pluses and minuses of the innovation and answering questions or concerns.

A tension exists in that more than half (56%) of respondents think that government lacks the competence and understanding of emerging technologies to regulate them effectively; the majority also believe that if effective regulations are put in place, their trust in innovation and technology would increase.

The opportunity for Government and Business

If regulation is one of the barriers to innovation, yet the existence of regulation increases the likelihood New Zealanders will trust an innovation; how do we reconcile the two? How can businesses work with government and regulators to increase public trust in innovation without slowing things down with more bureaucracy?

The Government is endeavouring to do away with onerous regulation and has created a new Ministry to achieve this. Deregulation, just like regulation, requires care to not create unintended consequences. Done well, and with the appropriate monitoring and evaluation, deregulation can reap economic and social benefits for business and the public.

The Trust Barometer shows that New Zealanders want to see greater partnership between government and business. For instance, if business partners with government, 56% said they would trust both entities more with technology-led changes. What this looks like in practice is genuine dialogue and commitment to a work plan focused on outcomes for New Zealanders rather than being motivated by commercial or political interests.

For business, it is critical to understand both the parliamentary and political processes that decision-makers must follow. While they can be incredibly frustrating and slow, they exist for a reason and any perceptions of cutting corners can further erode the fragile trust the public have to start with. For government, it’s important that both politicians and officials are genuinely open-minded to suggestions for improvements that business might have, rather than discounting ideas or innovations at the outset. Transparency around research and evidence that is being used to inform decisions is critical to foster trust on both sides.

What’s next?

The Government has sent a clear message to business that it wants to hear solutions to complex problems. This is a great invitation to take up.

While there may be an appetite for deregulation, we need to proceed with care. Removing what can be seen as important guard rails will need to be well communicated, done in partnership and be backed by experts in order for the public to trust that government and business are not making detrimental decisions.

For businesses looking to influence regulatory outcomes and unblock the barriers that prevent innovation, it is critical to understand the facets of the regulatory process. This means engaging early in the policy-making process, actively participating in consultations, and collaborating with regulators to shape policies. Employing a strategic approach to impact analysis and leveraging industry coalitions for co-regulation can be particularly effective. Ensuring compliance with existing regulations and demonstrating the ability to self-regulate can also strengthen a business's position in negotiations with government bodies.

Overall, businesses need to be proactive, well-informed, and collaborative in their engagement with Government to effectively influence regulatory outcomes in their favour.

Innovation is part of the identity for many New Zealand businesses. In order to grow, businesses need the trust of New Zealanders, to partner with government effectively and to utilise scientists, technical experts and evidence to support the suitability and impact of proposed changes.