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We all have an ethical responsibility. It means doing what is morally right for society and the planet, and sometimes these ethical principles are wrapped around regulations to enable enforcement. We can’t forget this during our digital evolution.
If Meta‘s string of scandals is any indication, tech companies don’t often think about their impact on society. The company was aware that Instagram could harm women’s self-esteem, yet continued developing a version of the application for young kids. Social media companies have generally engaged in unhealthy practices as the industry misuses data collected for targeted marketing, tailoring products and even defining public policies.
However, public opinion and regulations can force the prioritization of ethical responsibility. Companies must comply with regulations, as we’ve seen with economic sanctions against Russia for its aggression in Ukraine and China for its treatment of the Uyghurs. As the chief technology officer at a blockchain consulting company, I believe that all companies should consider the ethical implications of their technology stack.
Related: How to Navigate Data Privacy Regulations When Deploying Enterprise Blockchain Solutions
Ethical responsibility in business
Ethical responsibility in business starts with protecting individual privacy and personally identifiable information (PII). Clients require solution providers that comply with global privacy laws, such as Europe‘s General Data Protection Regulation (GDPR). When designing software, providers must secure PII data through encryption, enabling easy reporting and deletion at a customer’s request.
There are also ethical issues in financial management. There have been some egregious malpractices in past business that spawned a host of regulations, such as Sarbanes-Oxley, Know-Your-Customer and Payment Card Industry standards. Compliance with these regulations is mandatory for any business, regardless of industry or technology.
And sustainability is the ethical and social responsibility of every business. Companies need to review their carbon emissions, energy and water utilization and other sustainable practices to ensure a net benefit to their communities. Our planet’s finite resources are being depleted by mismanagement, and it is our obligation to preserve them for future generations.
Related: What Is Sustainable Entrepreneurship, and Why Does it Matter?
Ethical considerations for your digital transformation
Business ethics and responsibility extend beyond generating revenues and profits, and ethical behavior in financial management is about more than just regulatory compliance. It’s about contributing to citizen welfare, environmental sustainability and other aspects of society.
I worked for an organization that had an internal tool called “Business Opportunity Assessment” to evaluate potential tech initiatives, but it may have to be adapted for the new enterprise. Beyond simply considering corporate revenue goals, it should look at ethical aspects such as sustainability, use of child labor, workforce diversity, sourcing conflict minerals, supporting climate initiatives and other global concerns. There are three ways to ensure the business is practicing ethical principles.
Related: How to Build a Regenerative Business — and Save the Planet
1. Perform audits and compliance
Although an organization shouldn’t comply for compliance’s sake, regulatory compliance is the best way to ensure a foundation of morality in the organization. Tech giants like Apple and Google implement “privacy” in their products while still enabling powerful third-party analytics. Current testing approaches just focus on functionality, integration, performance and user acceptance and must be extended to cover ethical compliance.
Testing ESG compliance, business process transparency and data privacy will require new approaches, such as checking network energy usage. Bitcoin‘s network uses an unsustainable amount of energy, causing it to be banned in China. In response, Ethereum is upgrading to proof-of-stake mining to reduce the carbon footprint.
Exposure to PII can also pose one of the greatest threats. Therefore, clients increasingly require tech companies to be ISO 27001, SOC 1 and SOC 2 certified. HIPAA or GDPR violations are expensive, and companies must conduct security audits and test for exposures to malware, ransomware and other forms of nefarious cyberattacks.
2. Recognize employees as an essential part of success
I can’t emphasize enough the importance of a diverse workforce. Employees from different backgrounds can help remove implicit biases in technology to allow for equitable usage among all people. These efforts are crucial as racial and gender bias continue seeping into AI’s every use. OpenAI’s DALL-E 2 image generator, for example, is most likely to show a woman as a “flight attendant,” despite women being disproportionately represented in the data.
Your company should be monitoring systems for potential internal company threats, but employees should also have comprehensive training on diversity, security, privacy and regulatory practices. At Chainyard, we mandate that all employees undergo training such as security, data privacy and HIPAA.
Related: Decoding the Ethical Concerns With Respect To Technology
3. Include vendors and partners
An organization’s ESG compliance is tied to its downstream suppliers and business partners. One of the key challenges is to get those suppliers to adopt best practices and report on their progress. Make sure you are in consistent communication to build trust with them. ESG noncompliance can result in monetary penalties and impact a company’s future.
When building or adopting new technology, it’s easy to focus on the glory. It could make work processes easier, generate profits and support the company’s bottom line. But there’s more to business than just making money.
Companies should be concerned with the ethical considerations of doing business. Everything from our carbon footprint to how we treat others contributes to our net societal effect. We should all aim to do the right thing in everything we do.
