The Ethical Considerations of Data Analysis

In the modern business world and global market, companies need to pay attention to ethics when making business decisions. This rule should apply in all areas of a business but is especially relevant when it comes to data analysis. Data analysts must consider the security and privacy of their customers when storing any amount of personal data that could be exploited by or valuable to an outside party.

If data analysis shows that a specific decision will be monetarily beneficial to a business, but will cause harm to the environment or an individual, a company must ask if it is ethical to make that decision. Let’s say that your data mining efforts return with the result that if your company chooses to cut costs by obtaining raw materials from a supplier with poor environmental standards, you will have a 10% higher profit each year. Is it worth it to switch to a less environmentally friendly supplier?

Of course, there are other considerations as well. Customers now consider the ethics of a business before they interact with them—the 10% profit may not be realistic when factoring in consumers’ ethical choices. For some companies, this level of transparency may not be a problem but there are plenty of industries that are finding the typical customer has a higher level of environmental awareness and sense of social justice than they did even just a few years ago.

Companies now need to consider their impact on nations and communities on a worldwide scale. More people are becoming aware of what they buy and how it impacts the environment and people in other countries. A good example of this is clothing; some clothing is produced under questionable conditions in foreign factories; this can reduce production costs significantly due to lax labor regulations. This might not always be a smart business decision, however, as consumers are aware of this practice and are increasingly looking to get their clothing from ethical sources.

Another factor to consider is the ethics of retail pricing. Is it fair to the worker to charge $50 for a shirt that they were only paid a few dollars to produce? What is fair compensation for each step of manufacturing a product versus total profits for the company?

How to easily incorporate data ethics at your business

There are some methods that can be easily incorporated into your company policy that will ensure that you are using data in an ethical manner.

Always get permission

There is a reason why you are asked for your consent for any data collection. It is not ethical to collect data from people visiting your website, or using your software, or app without offering a document that outlines what data is being collected, what it may be used for, and then asking for consent. Companies are within their rights to refuse access to anyone that does not consent.

While a lot of people never read all the fine print, it is essential that they are allowed to do so. If they sign without reading, a company cannot be held liable for that action. While you should try to keep your disclaimer as short as possible, you want to be sure to not leave out any pertinent information that could come back to haunt you.

Be clear about your company’s policy of sharing or selling data or information

Plenty of companies share customer information for marketing purposes. This can be beneficial for companies with common customer demographics. In some cases, a company may get financial compensation for customer information. These practices can be considered ethical if there is an effort made to inform customers that their information may be used in this way.

Sharing customer information too much can result in customer dissatisfaction if people discover that they are getting a lot of solicitations.

Follow data collection regulations

Rules on data collection vary based on the country and the continent you are doing business in. It is essential that privacy and data collection laws and regulations are followed meticulously. The EU-US Privacy Shield is a good example of such laws.

Violating important privacy regulations can result in fines and other punishments that can impact your business’s ability to trade internationally.

Consider how well you are regulating your algorithms and AI technology

While algorithms and artificial intelligence are groundbreaking technologies that are helping businesses in many ways, they are far from perfect. It is important that both technologies are checked for bias that could lead to unethical or unfair decisions. One of the recent examples of biased algorithms is Amazon’s use of one to help them recruit employees. The entire algorithm had to be discarded when it was found to overwhelmingly favor men over women for all jobs.

Artificial intelligence is only as good as the data it has access to. That being said, AI is not sentient so it cannot make ethical decisions the same way humans can. AI technology needs to be monitored to make sure it has the information needed so that it can come as close as possible to making ethical choices.

Take reasonable precautions to protect customer and vendor data

We live in a time when a lot of companies, regardless of size, are falling victim to ransomware attacks and stolen customer information. It is not ethical to make little to no effort to protect private information from falling into the wrong hands. Data breaches lead to a loss of trust and thus a loss of customers. In some cases, a business may never gain back the number of customers they lost. What happens depends on the severity of the data breach and how much customers have to suffer financially or emotionally as a result.

Ransomware attacks put you in the position of not being able to conduct business until you either pay the ransom or redo your operations. In some cases, companies choose to pay the ransom because it is far less than the cost of losing business for days and losing customers due to distrust. Plenty of businesses get attacked by ransomware and no one ever knows about it besides the company and the attackers.

The financial impact of a ransomware attack is typically exponentially more than the cost of implementing good cybersecurity to start with. Hiring a professional to take care of data security is strongly recommended unless you are skilled in that area. Regular updates are necessary to keep ahead of the level of sophistication of attacks that modern companies are facing every day.

How does your company use internally collected data?

There is a lot of data collected internally at companies. Employees may find that a lot of data related to their work habits, communications, and more is gathered and sometimes used to make important decisions. It is up to each company to decide how ethical it is to collect or use some of this data within the operations of the company.

Communications data collection

Any communications done on company computers or servers are often subject to review. That doesn’t mean that every little message is looked at all the time, but it does mean that if there ever is a good reason for communications to be reviewed, absolutely all information may be looked at. This means any use of email, social media, messaging services, and platforms such as Airtable or Slack, may be looked at.

Employee data can be used to draw conclusions about relationships within a company

Let’s say that you have a major project coming up and you want to put together a team that you know without a doubt will work exceptionally well together. Employee data can be analyzed to see who at a company has worked with each other in the past and even see what the results of those projects were. This can be very useful at larger companies with many employees spread out among numerous locations or departments.

Of course, this type of data usage can result in the same people working together all the time rather than inspiring collaboration among a wider range of people. The ethical question becomes how much a company should keep track of the personal and professional relationships of its employees.

Surveillance can lead to suspicion, paranoia, and loss of trust

Collecting data can lead to employees feeling uneasy in the workplace. This means that they may be distracted while working which can affect overall performance. The paranoia that someone is always watching and waiting for them to mess up can result in poor morale among workers.

It is important for employers to seriously consider the benefits of collecting some types of data. Since the COVID-19 pandemic led to so many people working remotely, lots of companies have started using work time tracking software to make sure that people are actually at their computers and working for the number of hours they are expected to. Some consider this type of data collection to be an invasion of privacy and show a lack of trust. Businesses must ask themselves if it is ethical to use this type of data collection without due cause. If workers are completing their tasks and showing up for important meetings, is it ethical to track what they are doing on their computers every moment of the workday?

Ethics for data analysts

Data analysts are employed by companies to analyze data and find answers to questions that can have a major impact on the long-term success of a company. Analysts have the ability to process large amounts of data and mine it for standout information. Businesses can ask specific questions that they want answered and analysts can often get answers from readily available data.

An Online Business Analytics Masters Degree from St. Bonaventure University is an excellent way to learn how to help businesses reach their goals. In just under 2 years, you can be ready to help lead businesses into the future. The 100% online degree includes options for electives in many different fields so you can hone your skills in a niche that you are passionate about.

Some data analysts are employed at businesses as full-time analysts but a great deal are employed by analysis firms that are called upon by a variety of businesses to glean answers from data.

Data analysts must apply a strong set of ethical standards to their work. Here are a few ways analysts can achieve their goals in an ethical manner.

Customer data must be protected

All too often, you see reports of customer data being breached by hackers. Sometimes this data is merely shared while at other times it is sold or held for ransom. It is important that analysts have strong security measures in place to avoid any data being stolen. In addition, analysts that see that a business does not have strong cybersecurity should suggest they take steps to protect customer information.

Suggesting software and services that can close these security gaps is something any analyst should do if the need arises.  If security is particularly bad, analysis firms may consider halting any further work until security is assured. The last thing you want as an analyst is for a data breach to happen on your watch.  A breach could lead to other companies not trusting you with their data thus affecting your ability to attract future business.

Do not falsify data or inflate results if they are negative

Businesses are paying for you to offer them honest results even if they are not the results they would like to see. It is far better to be honest with a company when it comes time to present your findings based on data. One must learn to not take offense even if results are met with incredulity.

Of course, offering up a balanced view is important. Typically, there are at least some positive findings you can offer to balance out the bad but even if that is not the case, never skew results just because it is what others want to hear.

It is important to remember that all businesses have bad quarters and good quarters. Just because data shows that a business is in a slump doesn’t mean that analysis is not helpful. Analysis shows what the past and the current picture look like, so questions can be asked, and potential outcomes analyzed if certain changes are made. By using the data analysis process, companies can get answers that will help them make important business decisions without investing a lot of time and money into potential ventures that have low odds of paying off in the future.

Admit your mistakes

If you find a mistake in your analysis or in how data was collected, it is important to acknowledge this. It is far worse to let errors go unnoticed until they cause a major problem. Everyone makes mistakes and sometimes the most well-planned data collection practices have flaws. Analysts need to be honest throughout any project and create a plan to correct or account for errors and mistakes at any time.

Business leaders should ask for employee opinions and feedback regarding privacy and data collection

It is important to consider employee opinions and comfort levels regarding data and privacy policies. Encouraging feedback is a good idea so you can gauge the morale at your company. Anonymous feedback via surveys is best so you can encourage honesty without fear of repercussions.

If employees feel that their opinions and comfort level are valued then they are far more likely to stay with a company for a long period of time.


Businesses must make a major effort to stick to a strong set of ethics and principles. By doing this, they can develop a strong, trusting relationship with clients and collaborators. Data analysts can be utilized to process collected data and help businesses draw conclusions that can help them make ethical decisions for their business now and in the future. Protection of data via strong cybersecurity measures and regular updates is necessary for modern businesses to stay functional and not fall victim to ransomware attacks.