Digital transformation is our present and future. Emerging technologies, as you read this, are changing our society as we know it. Artificial intelligence, big data, IoT, process automation, are some of the technologies that give organizations around the world new business solutions. The need to virtualize many areas of work in the on-going COVID-19 pandemic is digitally shaping our lives. This is also giving companies a chance to rethink digital business ethics and answer important questions like how to manage data privacy rights while they actively adopt customer analytics for better service.

The Pressing Need For Business Ethics

Maintaining a balance between economical and ethical imperatives was always a focus-point for businesses. Companies must make profits while minimizing loss and maximizing customer and employee benefits.  However, the sudden digital transformation has left companies to deal with several ethical challenges. Building internal trust and gaining societal acceptance are crucial for new businesses to succeed. As Daniela Hanauer, partner and expert for Risk consulting at PwC Germany says, "digital ethics is not a marginal topic for companies. Firms that establish rules and standards for a responsible approach to digitalization gain the acceptance of customers and the trust of society. This ensures their long-term business success.

She says this based on PwC Germany's recent study that provides an overview of the challenges and responsibilities of companies in the digital age. Key findings of the study suggest that only half of the German companies consider themselves well-prepared for the current digital responsibilities. It also states that only one-third of the German companies say that they had a positive digital transformation, which implies that many companies have a long way to go.

Self-Regulation Is The First Step

Rather than waiting for regulation from higher authorities, being proactive will largely benefit the company in meeting its digital responsibilities. While some companies look at it as a disadvantage, something that comes in the way of business functions, the reality of the matter is that ensuring responsible handling of data will strengthen the trust in the market.

According to PwC, "a framework for digital ethics should be considered an opportunity, especially in a competitive environment. This is particularly true when working in close cooperation with other companies. Cooperation, industry associations, and exchange on common standards can enable companies to efficiently create transparency for their customers and stakeholders."

The Challenges

Many companies have realized the need for ethics and yet, they are finding it difficult to incorporate it. This is because companies lack the right talent to develop and implement digital ethics. Another challenge is the lack of awareness at the internal level of a company. For this to change, PwC suggests the following actions:

Taking Responsibility – By being proactive, a company can be one step ahead of its competitors by aligning its business with digital responsibilities.

Leveraging Existing Structures – Digital ethics should have a permanent place in management systems like risk management, compliance, and HR measures.

Upskilling Digital Ethics – All employees must be taught to have sensitivity and problem-solving skills that are needed to address many ethical problems

Incorporating Ethics In Business Processes – Digital due diligence must be incorporated in the supply chain. A digital ethics code of conduct can detect risks and enable a company to transparently communicate its corporate requirements to outsiders.