Consumer privacy good for business

Canadian companies interested in conducting business over the Web need to address the privacy concerns of consumers now and not wait until they are forced to by imminent legislation, according to panellists at a recent event in Toronto.

A barrier to e-commerce lies in the fact that consumers may not be eager to make on-line purchases if they feel their personal information might be in danger of being viewed or used by someone other than the intended recipient.

NCR Canada Ltd. addressed this issue at a recent executive breakfast it conducted in Toronto with members of the business community, including retail, financial, government and telecommunications leaders.

Following the breakfast, panellists spoke at a media briefing to discuss the issues surrounding consumer privacy and data collection. The speakers for the event included Mona Goldstein, chair of the Ethics and Privacy Committee of the Canadian Marketing Association (CMA, formerly the Canadian Direct Marketing Association), Robert Henderson, vice-president of NCR’s Privacy Center of Enterprise, and Dr. Ann Cavoukian, the Information and Privacy Commissioner for the province of Ontario.

All three panellists agreed that consumer privacy is good for business.

“The concern about informational privacy in the market place has risen in tandem with the rapid development of new technology,” Cavoukian said. “Consumers now want goods and services, but increasingly assurances that personal information which they may provide a business will be kept confidential, unless of course they consent otherwise.”

NCR’s Henderson compared the situation to the Y2K problem.

“The reason I say that it (the privacy issue) is as large if not larger than Y2K is that privacy does have resource and capital impact on a business,” he said. “I also believe that in the next 18 months, businesses that are collecting, analysing, distributing, processing personal end-data are going to have to change the way they do business to respond to the emergence of privacy. And those businesses who don’t pay attention to this are going to have problems in the next 18 to 24 months.”

The federal government is taking action with Bill C-54, expected to be passed this fall. The bill will extend policies already in place for the public sector to the private sector. All of the panellists support Bill C-54 and see it as an aide in the protection of personal and consumer privacy.

However, Cavoukian doesn’t think businesses should wait for the bill to be passed.

“Just do it. Start protecting your customers’ information now,” she said. “Any company that wants to grow should consider privacy as one of their major tenets. For this, you need no legislation.”

The issue of privacy is a touchy one in the marketing world, and for Goldstein, it meant that she had to look at the issue from two different sides: as a marketer who wants the information, and as someone who wants to protect it.

But Goldstein seemed very clear on her stance toward Bill C-54.

“We’ve also taken an active role in the development of Bill C-54, and believe the bill strikes the right balance by providing clear direction about how personal information should be collected, used and retained, while allowing to take advantage of new or emerging technology,” Goldstein said.

There are privacy solutions other than the bill that will increase in popularity over the next few years, according to Cavoukian. She cautioned that there is a difference between privacy-enhancing solutions and security.

“There are a lot of technologies that protect security in terms of encryption technologies that will secure the emission of an e-mail, for example, from one location to another,” she said. “Privacy-enhancing technologies are broader in that they encompass protections relating to the use of the information.”

She suggested the use of privacy-enhancing technologies that involve “pseudonymizing” or “anonymizing”, such as cloaking devices, as well as the trust of third parties or privacy seal companies.

“When you go to a Web site, for example, you will look for a trusted seal such as those covered by Truste, BBB On-line, CPA Trust, and what this will do is it will give you, the consumer, some assurance that this Web site not only has a privacy policy…but that the policy can be trusted,” Cavoukian said.