Making a Business Case to Protect Digital Rights

CIPE Insight | Anna Kompanek, Morgan Frost, Mahir Sheikh, Chris Doten

With two-thirds of the world regularly on the internet, we are experiencing an unprecedented shift in how people spend their money and time. Most companies, big or small, are now dependent on the internet for supply chains, connections to customers, and market information. A vibrant and inclusive digital economy requires the protection of digital rights: universal human rights of expression, assembly, privacy, and more as applied to the digital sphere. However, these digital rights that are essential for businesses to flourish in the 21st century are increasingly under threat. To address this challenge, the private sector, especially local business communities operating across the Global Majority countries, can play a key role in safeguarding democratic and economic freedoms in the digital age.

Digital Transformation

We are living through an extraordinary time of change brought on by the rise of the internet and ubiquitous global connectivity. Two-thirds of the world’s population now has regular internet access, which has improved connectivity infrastructure, increased competition, and decreased costs. Speedy 5G connections and new technologies such as satellite internet are also enabling millions more to connect to the internet every year.

The internet is integrated into our lives, producing tremendous changes in how we engage economically, socially, and politically. Digital technology has enabled people around the world to access digital health, online learning, social support, and government services, and these trends have only accelerated during the COVID-19 pandemic. Those online have the ability to access information nearly anywhere and connect with communities locally or around the world.

A Growing Digital Economy

The economy has been transformed along with these other societal changes. The ways that people spend their money and time are shifting, and with it the private sector. Firms of all sizes globally are increasingly changing business practices, supply chain and customer management systems, and methods of reaching the public by using digital technologies.

Companies that do not move with these trends are likely to fall behind the competition, miss opportunities to reduce costs, risk customer data, and fail to keep up with the changing ways customers are engaging in the marketplace today. Many businesses, including most small and medium-sized enterprises (SMEs) do not think of themselves as digital businesses, but in fact are directly or indirectly dependent on the internet. For instance, vendors are now able to sell products and services online and harness new “gig economy” ways of being an entrepreneur, such as through motorcycle ride hailing or delivery apps.

Even in places with the lowest levels of internet penetration, such as in Africa where approximately 40% of the population is online, most small businesses rely on mobile technology. Mobile money transactions in sub-Saharan Africa have surged to 1.26 trillion dollars annually, providing financial access and easy, reliable, secure transactions for SMEs. Ubiquitous, free messaging services such as WhatsApp also connect businesses with customers, partners, and potential investors who routinely ask, “Can I WhatsApp you?”

In addition to new efficiencies in how business is conducted, there are new potential markets and areas of growth. A growing digital economy means that many who have been isolated or less able to participate can do so online, and if the digital divide is decreased, more women and girls, people living in rural areas or with limited infrastructure, and other marginalized communities could more fully participate in the economy.

Digital Rights Under Threat

The way people experience and exercise their fundamental human rights has evolved over time. When we talk about digital rights, these are not new or less fundamental rights: these are the same universal human rights such as those defined in the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights, and other foundational charters. We now make use of these rights in different ways when sending messages, searching the internet, creating a website for our business, joining online communities, or managing information about our customers. Internet access is increasingly becoming a gateway to exercise these rights, as well as being key to participation in society and the economy. As we now live in a technologically interdependent world, we need to collaborate on building a rights-affirming digital society that is accessible to all.

While the internet has brought new opportunities to exercise fundamental rights, it has also created new and unique risks to digital rights, such as digital divides, privacy concerns, and internet disruptions. The private sector, including local business communities across the Global Majority countries, can and should play a key role in safeguarding democratic and economic freedoms in the digital age.

Digital Rights are Good for Business

Digital rights are now fundamental to successful businesses in the modern world. Every business has a stake in preserving an open, rights-respecting digital space. Digital rights can help protect modern business models by ensuring that companies can securely communicate with each other and their clients, share information about their products and services freely, and rely on online services with dependable connectivity to ensure customer access. Without a rights-respecting framework, businesses are at risk of losing large amounts of money. For example, internet disruptions can restrict customer access, interrupt supply chains, prevent advertising, block the flow of market information, and prevent members of the business community from connecting with one another. Businesses themselves also benefit from upholding digital rights in their own operations to strengthen their brand and avoid reputational risks, as it helps build trust with customers. For example, many successful businesses have made commitments to privacy a distinguishing feature for online products.

In the long run, upholding digital rights and building legal frameworks that support democratic and economic freedoms create an easier and more predictable environment for doing business. Appropriate frameworks and regulations that protect digital rights, developed in consultation with the local private sector, can help set a level playing field and ensure that the expectations and rules to conduct business in the digital space are clear for everyone. For example, businesses that are protecting customer data can be sure that all other organizations are bearing the same expenses and are blocked from selling private user information to gain an unfair financial gain or competitive advantage.

Codifying rights often requires appropriate norms at the local and international level; the right laws and norms can help defend company brands, support cybersecurity, provide protection for businesses against reputational risks, and protect the privacy of customers. Many global companies are also unable to work with SMEs in countries that do not have appropriate regulations that protect digital rights, placing undue burdens on local SMEs under these conditions that prevent them from joining global supply chains. More fundamentally, there are also basic ethical challenges with collaborating with companies that do not respect human rights.

Regulations Impacting the Digital Space

The rapid digitalization taking place across the globe puts policymakers under pressure to quickly develop and implement digital regulations that will have dramatic impacts on the economy. The local private sector can help build a better rights-respecting environment and economy by engaging with government and other key stakeholders to ensure that frameworks are beneficial for business and human rights.

At the same time, regulations that are too complicated or onerous can make compliance difficult, even if well intended from a digital rights perspective. If there are significant costs in implementing digital regulations, for example, to protect privacy, potentially only very large and already successful companies could afford to follow the letter of the law.

The Voice of the Local Private Sector

Digital rights are an important component of ongoing public-private dialogue on how to build a positive business environment, and the involvement of the local private sector in these conversations is essential. At the end of the day, a digital rights respecting regulatory framework allows the private sector to improve efficiency, tap into new markets, engage on a level playing field, and build successful business models. Moreover, without the input of the local private sector in these conversations, the only business voice will be large multinational companies, which could lead to regulations that are unfeasible for small businesses to implement, resulting in additional costs and burdens.

Now more than ever, the voice of the local private sector needs to be active in conversations on shaping and governing the internet. Through these dialogues, local business communities can help safeguard digital rights, while also ensuring that legislation impacting the digital space advances democratic and economic inclusion.

This article is a preview of a larger CIPE publication, Business Case for Digital Rights, forthcoming in early 2024.

Published Date: December 31, 2023