Building trust in the digital era: achieving Scotland's aspirations as an ethical digital nation

The Future of Work in a Digital Economy

Objects of Trust

Freedom of choice: Is it optional? Would not using it prevent me from doing important things?

Fairness: Is it accessible and usable by everyone who could benefit? Is it exploitative?

Institutions: Are they on the ball? Where does the buck stop?

What is the Future of Work in a Digital Economy?

“New industries appearing in this sector are great for employment and could involve retraining those in environmentally harmful industries for new work” (National Digital Ethics Public Panel Insight Report, 2021, p. 69).

The growth and advancement of digital technology and innovation is a priority for Scotland. With the ambition to become the ‘data capital of Europe’^[20] there is a drive to think about how businesses and organisations can start to adopt new digital tools and ways of working.

This means that the future of work will look slightly different. As has already been evidenced with the need for remote working over the COVID-19 pandemic, there is likely to be a shift towards remote working, using automated and cloud based services and relying more on digital tools to help support workers. The increased use of digital technologies could lead to a wide range of economic and social benefits.

Scotland’s thriving technology sector could provide numerous economic impacts and opportunities for Scottish citizens. An increased focus on digital could deliver:

• Improved health and wellbeing
• Medical/safety advances
• Improved job quality
• Lower costs for consumers
• Potential for higher paid jobs
• Ease of communication with companies
• Convenience
• Greater consumer choice
• Access for people otherwise excluded from the labour market– disabled, carers, older people.

“What are people are going to be re-trained to? Are there sufficient options and will there be the commitment and investment to back it up?”

National Digital Ethics Public Panel Insight Report, 2021, P. 68

Why is the Future of Work in a Digital Economy Important?

Scotland’s Digital Strategy (2021) outlines that "the businesses that have responded best to the challenges of the pandemic are those who have been able to innovate: pivoting quickly to homeworking, adopting cloud computing for speed and collaborative working, using new and secure digital platforms to access customers and to repurpose or diversify products and services and there is a growing body of evidence to suggest that this way of working is here to stay."

Whilst increased use of digital and automated services can help to offer an improved worker experience, there is a widespread concern that automation could lead to significant job losses and decreased social interaction. It may also exacerbate existing societal inequalities.

The balance between economic and societal prosperity is important when considering the future of work. Advancements in digital and AI technologies should be focused on assisting with human tasks, rather than eliminating them. Coupling this with investment in reskilling and the creation of new jobs in the digital sector will help to prevent largescale unemployment, as well as ensuring the workforce is appropriately skilled for the opportunities of the new market.

Case Study:

Governing the Rise in the Remote Economy

Sam Brakarsh & Prof. Abigail Marks

The Digital Strategy for Scotland (2021) sets as a goal that the country becomes a centre for home working, saying, “We will engage with communities in remote and rural areas to find ways in which Scotland can capitalise on changes in the world of work and position itself as a leading centre for home and remote working.” The articulated value of such an initiative is clear. It has the potential to increase the ease of work for entrepreneurs who would benefit from collaborations that extend beyond the local. Technologies exist to allow teams to coordinate without shared office spaces thereby purportedly increasing worker efficiency without in situ managerial supervision. In addition, remote work is framed as a solution to spatial inequality, opening up access to specialised employment for individuals in remote areas of Scotland who would otherwise find such opportunities restricted to those in larger cities and business centres. The potential for these benefits holds true. However, an overemphasis on remote work can lead to collective social harm and psychological harm. Comprehensive policy is needed to secure the economic and social gains whilst protecting against potential drivers of inequity that are embedded within remote work.

The language of inequality reduction can be co-opted by the for-profit industry to justify actions that may benefit the employer rather than the employee. Remote work can increase access to opportunity, but remote work is just as capable of being used as a strategy to shift costs of supplies and overheads onto employees. Throughout the COVID-19 pandemic, large organisations have provided insufficient support to employees to work from home. Most individuals have had to pay for basic office supplies out of pocket to make their home environment workable.

At least a quarter of employees had to finance provision for IT tools in order to homework during the COVID-19 pandemic and over half had to provide their own office equipment. In addition, working remotely is likely to silo employees and make collective mobilisation around worker rights more challenging. Shared hardships in the workspace are veiled through restricted social engagements on digital platforms. As one participant from the Working@Home project noted "And with the technology, you know, you can see people, talk to people... I think you missed some of the contact with people you’re particularly friendly with ... So, there’s probably been occasions where it would be nice if, you know, we could get together." Asking the question of who remote work serves, the employee or the corporation, is vital in assessing how to protect the wellbeing and rights of Scottish peoples in the digital economy.

Remote work has its own barriers to entry. Blue-collar workers, whose labour is inextricably tied to their bodies, or those who work in Scotland’s extensive tourist industry, will not benefit from policies aimed at increasing remote work. From a recent TUC (2021^[21]) survey of employers, there is the suggestion that organisations are less likely to offer flexible work to staff who were unable to work from home during the pandemic. One in six (16 percent) of employers surveyed said that after the pandemic, they will not offer flexible working opportunities to staff who could not work from home during the pandemic, compared to one in sixteen (6 percent) saying they will not offer flexible working opportunities to those who worked from home during the pandemic.

We cannot allow flexible working to become a perk for the favoured few – offered to a minority of the workforce who are able to work from home – and serving to reinforce existing inequalities. The remote economy is most likely to support middle to upper-income workers whose skills are easily transferable to digital platforms. Remote work is not radically restructuring the economy. It removes some barriers to entry but introduces others. In particular, the Working@Home^[22] project found that those who had large homes with less occupancy (and thus the space to afford a dedicated office) were more likely to ‘succeed’ at homeworking. From the Working@Home survey, it was clear that this advantaged men with 60% of men having a dedicated home office space compared to 49% of women. Moreover, with many remote workers having to pay for some of their own office equipment and IT provision, there is another advantage to those that are most affluent.

To find out more detail on Governing the Rise in the Remote Economy, click here to read the full case study from Sam Brakarsh & Abigail Marks.

Balancing cultural enrichment, economic benefit and the environment

Having access to Scotland’s shared cultural heritage such as; census records; birth, marriage and deaths records; world-leading collections in galleries and museums; and Scotland’s treasures that are digitised in libraries, is a crucial part of building an ethical society. Through understanding our past, we can understand more about our humanity. Digital provides us a new way of accessing this past, and we must ensure that access to our digitised past is accessible by all. There are complex intersections between digital collections and social media platforms, and different values that come in to play when supporting digital infrastructures that are for cultural engagement, and wellbeing, that extend beyond the cultural and creative economy.

Beyond accessibility, emerging technologies can enable the generation of much-needed revenue for artists, as well as cultural organisations, which are currently heavily reliant on public funding. Last year saw the meteoric rise of Non-Fungible Tokens (NFTs), a blockchain-based, fundraising medium that introduced scarcity into the digital realm. NFTs are described as the digital-equivalent of limited editions (as visualised in Figure 2 of the linked case study) and sales in 2022 have already exceeded 37 billion US dollars (Chainalysis 2022). Having emerged in the aftermath of the pandemic, in early 2021, NFTs were deemed as a “lifeline” for “cash-strapped” cultural heritage organisations (Ciecko 2021). Indicatively, in 2020, Museums Galleries Scotland had reported that two thirds of the country’s independent museums did not have enough funds to survive for a year (Knott 2020). With museums eager to explore new revenue streams, leading institutions globally experimented with NFTs; from the Uffizi Gallery in Florence to the British Museum in the UK. However, early experimentation from institutions with limited technological expertise, with a medium for which little is known, was bound to spark controversy and raise critical issues, as analysed in the attached case study. In addition, funding for cultural heritage, and digital cultural heritage, needs not to be only raised by institutions themselves: a society, which values its heritage and its past must fund its Gallery, Libraries, Archives and Museum (GLAM) organisations, and that includes providing adequate funding for them to embrace the opportunities and possibilities of digital.

Despite this, there are opportunities for the GLAM sector to experiment with new technologies. Even though there is currently a bear market within the crypto economy, more than 10 million US dollars are invested in NFTs every day (Anon. 2022c), highlighting the potential of this new fundraising medium, which has also opened up significant opportunities for artists and individual creators. Notably, Scotland is home to some of the world’s leading figures of the NFT market. However, as a nascent medium, NFTs are plagued by risks and unknowns, such as the environmental impact of making and selling NFTs (depending on the underlying blockchain), the unclear copyright landscape, as well as the issue of digital deaccessioning. As NFTs present a form of ownership, publicly funded museums should be discouraged from selling NFTs of 'digital twins' of artefacts in their collections. These challenges persist and must be acknowledged and proactively addressed, as explained in the attached case study.

With £230 million being invested every year in Scotland’s culture, historic environment and major events in order to ensure that the country’s “world class cultural scene and rich heritage continues to thrive” (Dickie 2022) it is important to explore ways emerging technologies could make a substantial economic contribution towards that goal.

Given the potential of NFTs as a powerful fundraising medium, which could contribute towards the financial sustainability of individual creators and cultural institutions heavily relying on public funding, it is recommended for the appropriate framework to be provided, to enable interested parties to explore this new medium cautiously and methodically. Scotland is home to pioneers in the broader field of NFTs, from the world-leading Blockchain Technology Laboratory of the University of Edinburgh, which is pioneering developments in its field, to best-selling artists globally in the NFT market. Therefore, facilitating knowledge exchange between those pioneers to share their knowledge, insight and learnings with other fellow artists, researchers, as well as, creators, cultural institutions and innovation entrepreneurs, would help artists and heritage organisations start leveraging and eventually reaping the economic benefits of this new medium. More importantly, it will help form and foster a vivid community of creatives, researchers, practitioners and organisations that could make a major impact by helping shape the future of the rapidly expanding decentralised web. Funding and support for digital experimentation within the GLAM sector is crucial be able to make the most of our shared heritage, and to be able to build upon it. NFTs are just one example of the type of innovation that can occur in this space.

To find out more detail on NFTs and Cultural Heritage, click here to read the full case study from Foteini Valeonti & Melissa Terras. It should be noted that there are serious concerns over the use of NFTs and blockchain and their environmental footprint. This case study aims to profile the existence of a rapidly emerging technology in a sector less commonly associated with digital. This does not detract from the importance of understanding e-waste, per the other content of this report in the ‘Green’ Digital Scotland chapter.

How is the Digital Economy an Investment in our Collective Future?

A profitable economy can have a positive influence on a number of societal factors. However, it is important to balance this with an awareness of how a digital economy promotes fairness and inclusion. There is a concern that the push to digital will come at a disadvantage to those in lower paid or lower skilled roles. Whilst efficiency and automation can be useful, human flourishing should be the priority. That is why an Ethical Digital Nation must consider the impact of a digital economy on:

• Job losses
• The loss of human interaction
• Impacts on vulnerable groups
• Risks to safety of individuals
• Harms to employee rights
• Unequal access to Information
• Technology and digital skills
• Consumer Rights
• Education
• Climate and sustainability.

Case Study

Datafication of Higher Education

Joanna Van Der Merwe, Melissa Amorós-Lark, And Grégory Von Boetticher

Digital technology is being integrated into higher education at an exponential rate, especially as the COVID-19 pandemic moved teaching online causing severe educational disruption across the globe. If done correctly, these tools and data can change the way higher education is delivered, ensuring that it is flexible and accessible. It can also empower students and teachers by giving them insights into their learning and teaching practices allowing them to improve themselves and their learning/teaching journey. As well as using digital technologies to increase community engagement and participation. Conversely, if implemented without adequate ethical considerations this data can be used to create a model of education reliant on the constant surveillance of teachers and students rather than empowerment. Additionally, with data being used for profit motives, rights to privacy may be at risk and boundaries between personal and professional/ student life blurred.

This case study takes on two examples to illustrate the ethical issues involving technologies, namely digital proctoring and the video-conferencing platform Zoom, which are currently in use and have permeated the (digital) education sector. Given the datafication of education, reflecting on the ethical concerns raised with existing technologies is vital in assessing the risks and benefits involved in future technologies and the design of a national policy on digital ethics.

Moreover, this case study contains insights from direct stakeholders such professors, student representatives and more. They touch upon themes such as awareness, data and digital literacy, the need to rethink education, new divides and barriers, funding, and power dynamics between institutions, staff, and students.

To find out more about the datafication of higher education in Scotland click here to read the full case study from Joanna van der Merwe, Melissa Amorós-Lark, and Grégory von Boetticher from Centre for Innovation Leiden University.

Case Study:

Fintech in Scotland

Felix Honecker

Over the past decade, innovations in financial technology (fintech) have started to transform the way financial services are delivered. Advancements in cutting-edge technologies such as artificial intelligence, natural language processing, cloud computing, Application Programming Interfaces (API), and blockchain continue to change how businesses in the sector operate, collaborate, and transact with their customers, regulators, and other stakeholders. Additionally, Open Banking practices allow fintech companies to access vast amounts of previously unavailable data (including transaction data), enabling them to develop new products and services that are potentially better suited to the needs of consumers.

Fintech’s economic potential is staggering and investment into the sector is booming, with venture capital funding in 2020 exceeding $4.1bn in the UK alone.^[23] Globally, the sector is projected to reach a value of about $305bn in 2025 – growth that is fuelled mainly by consumers and small and medium-sized businesses turning to fintech for payments, financial management, and financing.^[24] When promoting the fintech sector, businesses, NGOs and policy makers alike have highlighted not only its huge economic potential, but also its capacity to trigger positive social change. Fintech can improve the efficiency and reduce costs of the current financial system, extending financial services to previously unserved or underserved households. However, consumer experts have identified several obstacles that could reduce the positive social effects of fintech and, potentially, leave consumers worse off.

There is no doubt that fintech can play a key role in delivering some of the National Outcomes set by Scotland’s National Performance Framework. Scotland is home to a fast-growing fintech sector that benefits from the country’s historically strong financial services expertise, world-class universities and talent, and excellent business support ecosystem.^[25] The Scottish cluster has positioned itself among the leading fintech destinations in the UK and the world, creating high- income, tech-based employment in the country’s fintech cities Edinburgh, Glasgow, Aberdeen, Dundee, Stirling, and Perth.^[26] Through an increase in remote work, current and future jobs in fintech are no longer restricted to these larger cities but open up opportunities for high-quality employment across Scotland. Moreover, companies across a varied range of sectors can adopt financial technology tools for payments, accounting, cash flow management, smart contracts, and other business functions to increase productivity. These developments, therefore, contribute to the Economy, International, and Fair Work and Business outcomes of the performance framework.^[27]

Notwithstanding the aforementioned opportunities, there are several challenges emerging from increased fintech adoption. Social inclusion could be at risk if the ongoing COVID-19 pandemic accelerates the transition to digital financial services. Unequal access to digital infrastructure (e.g., lack of access to mobile phones, computers, or the internet) could exacerbate existing and create new forms of exclusion. Additionally, people who may have access to the necessary infrastructure but lack digital expertise may refrain from using new technologies and miss the opportunities associated with them. This could aggravate existing inequalities, expand the digital divide, and further isolate vulnerable groups.^[28]

Similarly, machine learning and data biases (which occur due to prejudiced assumptions made during the algorithm development process or biased training data) as well as inaccurate or incomplete data could restrict rather than broaden access to credit. There is some evidence indicating that, instead of delivering on the promise of facilitating access to affordable credit for previously excluded consumers, increasing data points in credit scoring also increases inaccuracies which in turn negatively affect creditworthiness.^[29] People who deliberately avoid leaving a data trail or who suffer from data poverty^[30] will be disadvantaged by these approaches if there are no moderating measures in place.^[31] This potentially forces people to establish a data history at the expense of their privacy if they want to avoid being subjected to unfair price discrimination (or being excluded from credit altogether). At worst, some of our most sensitive and private data could be extracted and used for exploitative ends. Thereby, the financial inclusion argument could be co-opted by firms to bolster their legitimacy.

“There is more to being online than we realise. Seek knowledge so you are aware of the personal and societal impacts of what you are doing.”

National Digital Ethics Public Panel Insight Report, 2021, P. 74