Can companies resist wrongdoing in a digital world?

Executive Summary

Rapidly advancing technologies such as big data analytics offer potentially great benefits to companies and consumers, but experts warn that modern technology also has a downside: It can give companies seeking a competitive edge the tools to engage in illegal or unethical practices. Because digital devices—from the sensors and computers that control the inner workings of automobiles to code that tracks individuals’ activities on the Internet—are powered by software that is inherently invisible, consumers and regulators are often in the dark about the data that companies are collecting and how they are using it. Industry groups and outside observers disagree about what should be done. The former argues self-regulation is sufficient while the latter seeks tough regulation and increased ethics training in business schools and companies. Among the questions being debated: Should the uses of big data be more tightly controlled? Should there be limits on employers’ monitoring of employees? Is software too open to abuse?

Looks like you do not have access to this content.

Please login or find out how to gain access.




Bamberger, Kenneth A., and Deirdre K. Mulligan, “Privacy on the Ground: Driving Corporate Behavior in the United States and Europe,” MIT Press, 2015. A University of California, Berkeley, law professor (Bamberger) and a professor at Berkeley's School of Information (Mulligan) explain the regulations governing corporate use of consumer data in five countries, including the United States, and how those regulations shape company behavior.

Howard, Philip N., “Pax Technica: How the Internet of Things May Set Us Free or Lock Us Up,” Yale University Press, 2015. A communications professor at the University of Washington outlines the challenges to come in the age of the Internet of Things and suggests measures to ease the way.

Schneier, Bruce, “Data and Goliath: The Hidden Battles to Collect Your Data and Control Your World,” W.W. Norton & Co., 2015. A security expert explores, and explains, the reach and power of surveillance tools that corporations and governments are using.


Barocas, Solon, and Andrew D. Selbst, “Big Data's Disparate Impact,” California Law Review, 2016, A technologist and a lawyer team up to examine the ways in which algorithms used in big data analytics can discriminate against groups of people.

Hunt, Robert M., “You Can Patent That? Are Patents on Computer Programs and Business Methods Good for the New Economy?” Business Review, Federal Reserve Bank of Philadelphia, First Quarter 2001, A Federal Reserve Bank economist offers a history of patent protection for software and questions whether the current system is a good one.

Richards, Neil M., and Jonathan H. King, “Big Data Ethics,” Wake Forest Law Review, May 19, 2014, A law professor (Richards) and a technology company executive (King) examine the ethical issues confronting those performing big data analytics.

Reports and Studies

“Big Data and Privacy: A Technological Perspective,” President's Council of Advisers on Science and Technology, May 2014, A report by a White House technology panel recommends that regulators focus on the uses of big data by companies rather than on collection and storage.

“Consumer Data Privacy in a Networked World: A Framework for Protecting Privacy and Promoting Innovation in the Global Digital Economy,” White House, Feb. 23, 2012, A White House report calls for legislation creating a “Consumer Bill of Rights” that would restrict what companies can do with consumer data.

“Data Brokers: A Call for Transparency and Accountability,” Federal Trade Commission, May 2014, This 110-page report from the federal agency that oversees consumer protection offers a thorough examination of the data broker industry and finds it lacking in transparency.

“The Latest on Workplace Monitoring and Surveillance,” American Management Association, Nov. 17, 2014, Corporate training group offers a wealth of up-to-date survey data on the surveillance and monitoring practices of U.S. companies.

“A Review of the Data Broker Industry: Collection, Use, and Sale of Consumer Data for Marketing Purposes,” Senate Committee on Commerce, Science and Transportation, Office of Oversight and Investigations Majority Staff, Dec. 18, 2013, A Senate report examines the growth of the multibillion-dollar data broker industry and finds that it operates hidden from consumer view.

Ciocchetti, Corey A., “The Eavesdropping Employer: A Twenty-First Century Framework for Employee Monitoring,” May 29, 2010, A professor of ethics and legal studies at the University of Denver's Daniels College of Business says the American legal system has failed to keep up with changes in monitoring technologies.

Furletti, Mark J., “An Overview and History of Credit Reporting,” Discussion Paper, Federal Reserve Bank of Philadelphia, June 2002, An analyst at the Federal Reserve Bank of Philadelphia provides a concise and interesting history of the development of consumer credit databases and reporting services.

The Next Step

Big Data

Clover, Charles, “China: When big data meets big brother,” Financial Times, Jan. 19, 2016, The Chinese government has licensed eight companies to collect Web users’ data and develop so-called “social credit” ratings that affect eligibility for activities ranging from travel to pet adoption, a practice that some have deemed mass surveillance.

Darrow, Barb, “Coming Soon: Ethics Training for Data Scientists,” Fortune, Dec. 4, 2015, All university data science programs will add classes in 2016 on the human implications of mass data collection, a principal data researcher for Microsoft predicts.

Green, Chloe, “By 2018 big data will be responsible for half of ethics violations in business – study,” Information Age, Oct. 7, 2015, Big data collection will cause up to half of all business ethics violations by 2018, although companies can cautiously invest in advanced analytics and implement clear strategies for their use to reduce future violations, according to a U.S. market research firm.

Employee Monitoring

Melendez, Steven, “The Office Is Watching You,” Fast Company, May 22, 2015, Technology start-ups are developing software that other companies can use to track employee time spent in meetings and track behavior and workplace engagement levels.

Shockman, Elizabeth, “Gamifying the workplace: is it ethical?” Science Friday, Public Radio International, Sept. 5, 2015, More companies have introduced software in offices in recent years that track employee health habits to optimize performance, though some say such technologies can be disruptive and disregard the personal interests of employees.

Son, Hugh, “JPMorgan Algorithm Knows You’re a Rogue Employee Before You Do,” Bloomberg Business, April 8, 2015, Financial services firm JPMorgan Chase will introduce an employee-surveillance program in 2016 that uses algorithms to track whether workers follow trading rules and complete compliance courses, among other criteria, to reduce legal risks.


Ashford, Warwick, “EU privacy watchdog to set up ethics advisory group,” Computer Weekly, Jan. 6, 2016, The European Union's independent supervisory data-protection body plans to form an ethics advisory group that will recommend ways for the EU to use new technologies while protecting personal privacy.

Scott, Mark, and Natasha Singer, “How Europe Protects Your Online Data Differently Than the U.S.,” The New York Times, Jan. 31, 2016, The EU grants Web users more data-related protections than the United States, including the rights to request that search engines remove links with personal information from results and that companies share personal data they have collected and how they are using it.

Wagner, Kurt, and Mark Bergen, “Europe's 'safe Harbor’ Ruling: A Headache for Tech Giants, but a Blow to the Little Guys,” re/code, Oct. 6, 2016, A 2015 European Court of Justice ruling, which invalidated an agreement that permitted American companies to transmit data gathered in Europe to the United States, will likely mostly harm small- and medium-sized companies that lack other data-collection arrangements with EU nations.

Hiring Discrimination

Lam, Bourree, “For More Workplace Diversity, Should Algorithms Make Hiring Decisions?” The Atlantic, June 22, 2015, A software company that develops algorithms that can analyze job applicants’ behavioral data, predict their performance and compare it to that of top employees claims companies using its software would hire 26 percent more blacks and Hispanics on average.

Noguchi, Yuki, “How Startups Are Using Tech To Try And Fight Workplace Bias,” NPR, Sept. 1, 2015, Some software start-ups have developed technology that mitigates racial or gender bias by playing down résumés in favor of skill-based tests, and others have created training methods for managers that identify their hidden biases in evaluations.

Pepitone, Julianne, “Can Résumé-Reviewing Software Be As Biased As Human Hiring Managers?” NBC News, Aug. 17, 2015, Computer science researchers from the Universities of Arizona and Utah and Haverford College developed a test that they say detects hidden bias in supposedly gender- and race-blind hiring software.


Center for Democracy and Technology
1634 I St., N.W., #1100, Washington, DC 20006
Advocates laws, corporate policies and technology tools that protect the privacy of Internet users.

Direct Marketing Association
1333 Broadway, Suite #300, New York, NY 10018
Industry organization that represents the interests of marketing companies and data brokers.

Electronic Frontier Foundation
815 Eddy St., San Francisco, CA 94109
Focuses on defending civil liberties in the digital world and lobbies for legislation at state and federal levels.

Electronic Privacy Information Center
1718 Connecticut Ave., N.W., Suite 200, Washington, DC 20009
Research center focused on technology-related privacy and civil liberties issues; also lobbies for privacy legislation.

The ePolicy Institute
2300 Walhaven Court, Columbus, Ohio 43220
Consulting group that offers seminars and webinars to clients seeking to minimize electronic risks, maximize compliance and manage employees’ online use and content.

Federal Trade Commission
600 Pennsylvania Ave., N.W., Washington, DC 20580
Agency charged with preventing business practices that are anti-competitive or are deceptive or unfair to consumers; also holds workshops, makes legislative recommendations and conducts enforcement actions.

National Society of Professional Engineers
1420 King St., Alexandria, VA 22314
Professional society that provides education and training, and advocates for measures aimed at protecting engineers and the public from unqualified practitioners.

National Workrights Institute
128 Stone Cliff Road, Princeton, NJ 08540
Nonprofit spinoff from the American Civil Liberties Union that is focused on protecting human rights in the workplace.

Open Source Initiative
855 El Camino Real, Suite 13A, #270, Palo Alto, CA 94301
Educational and advocacy group that backs adoption of nonproprietary software; also serves as a licensing body for Open-Source Definition compliant software.

DOI: 10.1177/237455680204.n1