Privacy Policy Disclosures of Companies: An Exploratory Study of Country Level and Industry Level Differences

Abstract

Growing customer privacy concerns are resulting in companies paying increased attention to privacy. The main challenge to e-commerce companies is to balance the competitive advantages provided by the use of personal information with the privacy concerns that customers may have regarding the use of their personal information. This study investigates companies’ privacy policies stated in their privacy policy disclosures (i.e., privacy policy statements). We examine 360 companies’ privacy disclosures from six countries (U.S., Canada, U.K., Germany, Japan, and China). Our findings indicate that there are important differences in companies’ privacy disclosures and, by implication, privacy policies and practices across countries. The results also show that regulatory intervention significantly increases companies’ privacy policy disclosures compared to no regulation. However, the self-regulation regime practiced in the U.S. led to privacy policies that were no less extensive than those implemented by companies in government regulation regimes. Finally, no difference was found in the privacy policy disclosures of companies in more information-sensitive industries compared with those in less information-sensitive industries.

Keywords: Privacy, privacy policy disclosure, electronic commerce