The surprisingly competitive advantage of digital trust

By Tarsus Distribution

Data is the foundation of today’s world, and it governs the ways in which people, organisations and societies work together. As technology rapidly advances and the importance of data increases, it’s no wonder that McKinsey is predicting 2025 to be the year of “the data-driven enterprise.”

 By 2025, according to the World Economic Forum (WEF), we will produce an estimated 463 exabytes of data each day. How this data is used, stored and governed can have a substantial impact on users, communities and the planet. That’s why we have seen an upsurge in policies and initiatives designed to protect people and their data from ending up in the wrong hands.

WEF states that responsible data usage is imperative for three key reasons:

• Promoting responsible and ethical data policies strengthens digital trust, helps build more resilient business and also benefits the planet.
• Emphasising the value of responsible, ethical data policies will reinforce and build digital trust and build resilience, while also saving our planet.
• To build resilient responsible data frameworks, businesses must do an iterative review and update of data protection policies and processes.

Covered in this article

Building digital trust
Get the C-suite involved
Establish data ownership and risk mitigation
Embed data principles in company operations

Building digital trust

Our digital world is becoming increasingly regulated, with organisations everywhere being called upon to address the critical issue of how volumes of customer data can be managed ethically. They need clear, transparent standards on how they will protect data and use it responsibly.

"Businesses that invest in building digital trust will win the approval and loyalty of consumers who are demanding secure digital experiences that respect and safeguard their privacy."

Without a formalised data usage programme, data can be breached or sold to third parties without consent. This could result in significant reputational damage and financial costs for companies, with leaders being held personally liable.

McKinsey Digital highlights that a data program should go beyond regulation in protecting the privacy and use of customer data: “It should focus on providing transparency about what data is collected and how, how the information is used, and whether those use cases are appropriate. Further, companies should be able to identify potential data usage that might be deemed illegal.”

Get the C-suite involved

It’s important to keep the CEO and the board in the loop when it comes to decisions about data ethics. In addition, having a champion in the C-suite indicates the importance of data ethics to the rest of the organisation.

Establish data ownership and risk mitigation

Your organisation’s data programme should define the ethical use of data and data ownership and determine who controls access to the data. The policy should also state who is responsible for the data collected and processed.

Managing risk is a vital element. Organisations should also be aware of existing data risks, such as using personal customer contact information. Say something goes wrong, like an unauthorised user negatively impacting the confidentiality, integrity, and availability of data that you collect, transmit, or store, the business will need an escalation process in place to address this.

Embed data principles in company operations

Your organisation’s data principles and rules must be integrated into operations across the business, including its corporate strategies.

Regardless of where you begin, it’s important to establish KPIs for monitoring and measuring the progress towards achieving your data ethics objectives. Formal training programmes on data ethics for everyone in the organisation will ensure that that the ethical use of data becomes part of each employee’s day-to-day work.

Changing organisational culture and attitudes toward data is no easy task, but companies that fail to implement and uphold ethical data usage standards risk losing customers’ trust – the most valuable form of currency today – and losing trust means losing business.

References:

https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-data-driven-enterprise-of-2025
https://www.weforum.org/agenda/2019/04/how-much-data-is-generated-each-day-cf4bddf29f/
https://www.weforum.org/agenda/2023/01/davos23-responsible-data-protection-economic-crisis/
https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/tech-forward/ethical-data-usage-in-an-era-of-digital-technology-and-regulation