Our engagement on child safety online

From an investment perspective, children’s online safety and digital wellbeing can affect long-term value creation across the technology sector and beyond. We see four particularly relevant drivers:

Changing consumer sentiment: public expectations are shifting toward greater demand for digital wellbeing and child protection online. This can create downside risks (reduced engagement, advertiser pressure, reputational damage), but also upside opportunities for platforms that can demonstrate safer, age-appropriate experiences, and earn sustained trust. The erosion of consumer trust and ongoing concerns that vulnerable populations are not adequately protected are increasingly pointing to a market for a safer online experience for their children. This reflects a clear growth opportunity for companies that lead on safety: by demonstrating safer, age-appropriate experiences and earning sustained trust, firms can attract and retain customers 

Litigation and regulatory risk: legal challenges, penalties and compliance costs are rising globally. Companies that fail to address foreseeable harms face greater financial and operational uncertainty, while clearer standards can reward firms with robust governance and better safety-by-design capabilities.

Brand and reputational damage: a company’s response to child safety online issues increasingly influences its public image and social licence to operate. Failures in this area can erode brand equity, deter business partners, and lead to a significant, long-term loss of trust. Conversely, firms that proactively safeguard young users can differentiate themselves, strengthen their brand reputation, and head off reputational crises before they materialise.

People and culture: responsiveness to stakeholder concerns, including those raised internally be employees, can help to build an internal culture of debate and proactive risk management. Credible approaches to safeguarding children and responsible product design improve a company’s culture and employees’ attitudes towards work.

In the UK, we welcome the Government’s intention to take a system-wide approach, bringing together not-for-profits, schools, parents, government, and finance, to prevent further harm and reduce escalating social and financial risks. We encourage the Government to consider the following measures:

• Ensure tech companies deliver age-appropriate experiences. Children’s needs and vulnerabilities vary significantly by age and stage of development. Regulatory approaches must reflect this by implementing evidence-based age restrictions for general access and imparting responsibility on the platforms not the child or parent.

• Address addictive product design and high risk features in line with public heath evidence through clear guardrails and transparency requirements. While digital services provide important benefits, persuasive design features can drive excessive use and amplify harm, particularly for younger users. Companies should integrate child safety considerations into their product development, governance and risk management processes (e.g. conducting child impact assessments, appointing board-level safety oversight, building in parental controls and moderation resources).

• Ensure there are consistent, proportionate enforcement mechanisms to avoid a fragmented approach that increases compliance costs and implementation risks for companies. Robust and effective age assurance mechanisms should meaningfully enforce age limits and companies should be required to clearly evidence how they are protecting young people. This may include data on how impacts controls are implemented and monitored (e.g. incident reporting); how impacts on children are considered in the product design and development stages (e.g. to mitigate compulsive use drivers); and a small set of comparable KPIs (e.g. prevalence of harmful exposure, number of high-risk interactions, age-assurance effectiveness). These requirements support more stable cashflows and lower risk from fines, litigation, and reputational damage. This would improve comparability for investors, reduce informational asymmetry, and support stewardship and capital allocation for investors.

• Adopt a system-wide approach to safeguarding children across the digital ecosystem. Treat child online safety as a cross-sector issue, for example across advertising, consumer goods, gaming, telecoms and app stores so as not to solely focus on "social media companies". This will prevent risk from simply migrating and displacing reputation and regulatory impacts unexpectedly on downstream companies. Encourage the use of established human rights frameworks such as the OECD Due Diligence Guidance on Responsible Business Conduct or the UN Guiding Principles Reporting Framework, to identify potential adverse impacts and help manage risks to children.