BCG Henderson Institute

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Nearly all social compacts are based on trust, including the one between governments and the residents of a country, a city, or some other political region. Today, as societies grapple with rapid change and the stresses of growth—growth that is forecast to make cities home to 68% of the world’s population by 2050—recognizing that fact could hardly be more important. Between May 2020 and January 2021—the height of the COVID-19 pandemic—trust in government declined in the 11 countries surveyed for the Edelman Trust Barometer.1 In many US cities, soaring crime rates have shaken residents’ sense of security. At the same time, trust-building measures, such as those undertaken by Taiwan and Singapore to contain the pandemic, have reassured residents and helped maintain normalcy during a crisis that has overwhelmed and demoralized so many of the world’s cities.

Trust is broadly considered an essential feature of well-functioning economic and social systems. We know, for example, that trust is one of the strongest levers for promoting sustainable development in cities. That’s because sustainable development depends on resident advocacy—how willing people are to tie their future to their city—and advocacy springs from a foundation of trust. Moreover, in situations where neither hierarchies nor markets prevail, trust is particularly important because it’s the primary means of promoting cooperation. This is true in business ecosystems as well as in socioeconomic systems such as cities, where constituents need to cooperate for the common good.

To maintain the social fabric—and fulfill their promise to residents and local businesses—governments need to foster and fortify trust with and among the people they serve. Building on our previously published research on trust in business ecosystems, this article explores the nature of trust in the context of a city: its benefits (and the problems that spring from its absence) and how it works between government and the residents of a city and among those residents. Drawing from real-world examples, we then explore the two main ways that city leaders can build trust: directly, by emulating the scale that gives tribes and small communities cohesiveness, and indirectly, by adopting instruments and techniques to generate trust or manage distrust.

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