Eight Sound Business Reasons for a Privacy Policy

It seems almost daily, we read in the media about another situation in which personal information has been compromised. The sensational ones involve banking information, identity theft or health information. It is likely there are many other times personal information is shared with someone who has no right to see it. It may involve divulging a home phone number or talking about personal matters.

At a minimum divulging of the information may create embarrassment. At a maximum it may create severe financial hardship. People are becoming more and more concerned about who has access to personal information and what it is being used for.

While technology may have made it easier for others to get that information, technology isn’t the only way. Personal information may unintentionally be shared through discussions in a public place, discovered in the garbage, left on a desk in view of others, faxed to a wrong number or stolen and sold by an employee.

As a business you have a legal and moral obligation to protect any and all personal information you hold on customers (prospective, current and former) and suppliers. However, there are several other business reasons to protect personal information and let people know what you are doing.

1. It is required by law- either under PIPEDA (Personal Information Protection and Electronic Documents Act) or “substantially similar” provincial privacy legislation, and there are fines and penalties if you don’t comply.

2. More important than the fines and penalties, you avoid the negative publicity that results when complaints are upheld. – People don’t like to deal with organizations that don’t respect the privacy of their information.

3. Because you inform the person why you are collecting the information and how you plan to use it, there are fewer complaints and misunderstandings that you have to deal with.

4. Although it may seem like an oxymoron – you may actually reduce paperwork. You might collect less information. You will more likely keep information in one place and you will destroy it when it is no longer needed for the purpose it was collected.

5. As you develop a policy you will think about why you collect information and what you use it for. The result? There no longer may be a need to collect the information. Therefore - streamlined records flow.

6. When you and your staff can explain why you are collecting certain information – it reduces denial of consent. The person has a logical and reasonable explanation of why you want it and are more willing to give it.

7. The seventh reason to have a Privacy Policy is to separate yourself from the competition. Even though a privacy policy is required by legislation, many organizations, particularly smaller ones, don’t have one. They can’t be bothered. They don’t think it applies to them. They don’t want to get caught up in their own rules.

By developing and proudly displaying your privacy policy you are saying to others that you respect the privacy of their personal information. By not having a posted policy, your competition is telling a different story.

8. The last reason to have a privacy policy – because treating personal and confidential information with respect is THE RIGHT THING TO DO!

Developing, communicating and adhering to your own Privacy Policy is not only the law – it can mean greater customer loyalty and greater sales. In other words – it makes business sense.

For further information on developing a privacy policy visit the web site of the Office of the Privacy Commissioner of Canada at http://www.privcom.gc.ca where there are links to various provincial privacy sites as well.

Bill Gilbert is a Small Business Coach who helps take the mystery out of starting and growing a small business. He is a partner in a business called On Target Presentations and can be reached at bill@ontargetpresentations.ca.

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NOTE: The preceding article may be reprinted in full without charge as long as author credits are provided and notification is sent to bill@ontargetpresentations.ca.