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Frédérique Six and Hans Van Ees

Trust plays a role in all relations within regulatory regimes, as Six and Verhoest (this volume) show in their literature review. They conclude that, among others, the dynamics of processes for trust building and repair are under studied. In this chapter we begin to address this gap. In a double case study, we reconstruct and analyse the interaction process between a public regulator (water board in charge of licensing and enforcement for water management) and public regulatee (local authority developing new housing district). Even though (dis)trust was not often explicitly mentioned, processes of trust building and repair provide a fruitful conceptual lens through which we can understand and explain what happens. Our micro-level study shows how trust is built and what happens after trouble occurs and conflict erupts. We tentatively formulate propositions on processes of trust building and repair at individual and organizational level.
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Frédérique Six and Koen Verhoest

This edited volume is the first endeavour to systematically investigate the role of trust in the different relations within regulatory regimes. Trust as a multifaceted concept is contested within public administration and political science in general and especially within the relation between regulator and regulated party. The aim of this book is to scope the field and to set the agenda for further research. In this introductory chapter we map the different relations within regulatory regimes and review empirical research into the role of trust within the different relations. Our review reveals several themes that we address in the different empirical chapters and in the research agenda formulated in the concluding chapter.
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Edited by Frédérique Six and Koen Verhoest

Within political and administrative sciences generally, trust as a concept is contested, especially in the field of regulatory governance. This groundbreaking book is the first to systematically explore the role and dynamics of trust within regulatory regimes.
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Haiko Van der Voort

Public regulators increasingly cooperate with self-regulating industries regarding their oversight activities such as standard setting, information gathering, and sanctioning. The effectiveness of this “co-regulation” has been discussed extensively in the past decade, albeit usually with the government’s perspective in mind. This contribution focuses on the emergence and maintenance of co-regulation as an interaction process in which public regulators and self-regulating industry are involved. This process provides explanations for the effectiveness of co-regulation. This chapter takes “trust” and “cooperation” as the core variables. They are perceived as mutually dependent. The interplay between trust and cooperation is coined “trust-in-action”. It is assumed to be embedded in institutional arrangements, but may produce these arrangements as well. Two case studies show the complex interaction processes among public regulators, self-regulating industries, and intermediaries. The cases involve the regulatory regime on the quality of Dutch eggs and the regime concerning the reliability of Dutch temporary employment agencies. Both case studies start with public and private trust in co-regulation, expressed in institutional arrangements. However, in one of the cases this trust-on-paper did not find fertile ground on an operational level, while in the other it did. The cases confirm that on an operational level, trust is both an enabler and a result of cooperation. However, this mutual reinforcement process of trust and cooperation needs to be supported by institutional arrangements made on a political level. These institutional arrangements can be artifacts of distrust rather than trust.
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Russell W. Mills and Dorit Rubinstein Reiss

As part of the shift from command and control to process oriented regulatory regimes (Gilad 2010), building trust between regulators and the regulated firms has grown in importance. Collaborative mechanisms often rely on a free-flow of information and communication, which requires the building and maintenance of trust. This exchange of information and trust building is even more vital in complex and high-risk industries where potential information asymmetries and prevailing motivations could lend themselves to the hiding of information (Gormley 1986; May 2005). In this paper, we examine the evolution of the role of trust in the U.S. Federal Aviation Administration’s Voluntary Disclosure Programs by developing case studies of three voluntary disclosure programs: the Aviation Safety Reporting System (ASRS), the Aviation Safety Action Program (ASAP) and the Voluntary Disclosure Reporting Program (VDRP). Using extensive interview and observational data, we demonstrate how trust is essential to the operation of the problems. We show how the FAA used institutional mechanisms to create trust at the national level, but at the local level, personal relationships had to be built to foster trust. The need for relationship-based trust building meant that the level of trust between the FAA and air carriers varied across regions and was often contingent upon the enforcement style of the regulator. While trust is necessary for the programs we describe and can provide substantial benefits to the public, it can also lead regulators to ignore warning signs and miss problems. We explore this darker side of trust using the Southwest Airlines incident.
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Peter Oomsels and Geert Bouckaert

In this chapter, we study interorganizational trust of regulated organizations in regulating organizations in the Flemish public administration. The objective is to better understand interorganizational trust and the (perceived) characteristics of interorganizational interactions that contribute to its development. We propose that the interorganizational trust process is affected by boundary spanners’ perceptions of certain macro and meso-level interaction characteristics. Findings from our nested mixed-method analysis, in which we compared trusted and distrusted interorganizational interactions in Flemish public administration, show that macro- and meso-level interaction characteristics affect the trust process through various direct and indirect mechanisms, that both extent and form of these interaction characteristics are important to understand how they affect interorganizational trust, and that macro- and meso-level interaction characteristics shape each other in neo-institutional structuration processes. On the basis of these findings, we suggest that any due understanding of interorganizational trust must acknowledge that no single group of institutional, rational, or social exchange theories can provide a full understanding of interorganizational trust. A model that allows interdependent macro- and meso-level interaction characteristics to affect the trust process may be required to achieve a comprehensive understanding of interorganizational trust.
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Betsy Carter

Both French and Italian quality wine regulation developed as a means of creating a protected market by guaranteeing a traditional, limited-quantity product. But consumer trust in the private, government-backed mark varies significantly in France and Italy, and France manages to obtain significantly higher prices for regulated AOC wine than their Italian DOC counterparts. This article investigates the origins of divergent trust patterns as well as the relationship between trust and production strategies. My research indicates trust patterns are shaped by the structure and operation of the regulatory regime. Drawing upon extensive personal interviews, I find price differentials and trust in the regulatory mark may be explained by three factors: administrative historical legacy and government trust, trust among supply chain actors, and market structure. Higher institutionalized trust—or trust in the regulatory regime—is associated with higher quality production, higher prices, less price-based competition, and less market concentration.
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Erik Baekkeskov

Do formally autonomous agencies tasked with expert regulatory roles act deliberately to gain and maintain trust among policy stakeholders? This chapter explores the question through a study of influenza pandemic response processes in an anonymized European public health agency (EPHA). In particular, it tests whether seeking a reputation for trustworthiness could shape the agency’s 2009 H1N1 “swine” flu pandemic responses. In doing so, the analysis breaks new methodological ground: where most previous analyses have relied on retrospective studies, this analysis uses a unique, first-hand participant-observer record and interviews collected within EPHA. It shows that demonstrating trustworthiness to various audiences could control some of EPHA’s pandemic response actions and overrule rival concerns. Hence, deliberate trust-building can demonstrably be a powerful driver of autonomous agency behaviour.
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Lovisa Näslund and Kristina Tamm Hallström

In the chapter “Being everybody’s accomplice: trust and control in eco-labelling”, the focus is on regulatory regimes as intermediaries. Using case studies of three Swedish eco-labelling organizations (Good Environmental Choice, The Swan, and KRAV), the chapter studies how regulators, through the creation of impersonal system trust, are able to act as guardians of trust on globalized markets. In order to do so, they need to be credible as accomplices to both citizens and organizations (regulatees). Voluntary private regulators need to solve the paradox of appearing to distrust regulatees (in order to attain legitimacy as independent regulators), while simultaneously creating a trusting relationship with them (in order to enable a business relationship and ensure compliance). The studied labelling organizations use a combination of strategies to solve this dilemma. In terms of organizing, the different tasks necessary to create an eco-label are separated and decoupled. However, as it is not the act of monitoring itself that breeds distrust, but rather the attitude of distrust that it tends to signal, such organizational strategies need to be combined with sensegiving strategies, seen here in terms of three storylines, highlighting different aspects or interpretations of the regulatory regime, and aimed at different stakeholders. The chapter thus shows how the intermediary position of a regulatory actor allows it to act as a guardian of trust, but giving this chain of strangers legitimacy and authority, and ensuring compliance with its regulatory regime creates a dilemma that requires strategic sensegiving and organizing in order to be solved.
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Frédérique Six and Koen Verhoest

In this concluding chapter we formulate a research agenda for trust in regulatory regimes, based on the insights gained from the chapters in this edited volume. This agenda follows the five themes identified in the introductory chapter: 1) there are outstanding issues for most trust relations within regulatory regimes that need further research; 2) the interactional dynamics between the different trust relationships within regulatory regimes need more systematic research; 3) the dynamics of processes of trust building and repair within regulatory relationships are understudied; 4) there are still unresolved conceptual issues around trust and related concepts that need further study; and 5) the field is ready to move to more theory building and hypothesis testing research.