Ethical Implications of Data Privacy Regulations on Routine Organizational Operations: An Empirical Structural Equation Modeling Study

Abstract

Digital technologies have evolved quickly and the use of digital processes has changed the way that personal data is collected, processed, stored, analysed and shared by organisations. Meanwhile, the introduction of comprehensive data privacy rules has completely shifted organizational duties related to the ethical utilization and security of personal data. Data privacy has shifted from a primarily technical concern to a strategic, ethical, legal, and operational one with regulations like the General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), and various other national and sector-specific data privacy laws and policies. This study explored the ethical considerations of data privacy rules in everyday organizational processes, focusing on privacy compliance burden, employee awareness, organizational transparency, organizational ethics of data management, operational efficiency and organizational trust. The research method used in the study is quantitative research with analysis method used is structural equation modeling (SEM) to check the relationship between constructs. The data were organized using a questionnaire that was designed using the existing theoretical ideas about information privacy, organizational trust, technology acceptance and responsible data governance. The criterion of the measurement model was evaluated based on the factor loading, Cronbach's alpha, composite reliability, average variance extracted, convergent validity and discriminant validity. The direct effects of privacy regulatory compliance, awareness of privacy issues, transparency and ethical data governance on operational efficiency and organizational trust were analyzed in the structural model. The analysis revealed that there were positive relationships between good privacy compliance practices and good ethical data governance and organizational transparency. Perceived operational efficiency was found to have a negative direct relationship with privacy compliance burden, and positive relationships with privacy awareness and ethical data governance. Educational data governance also proved to be a strong indicator of trust within the organization. The results showed that data privacy laws imposed extra procedural demands on normal organizational tasks, but that the ethical application of the data privacy principles was more than an administrative burden, it became a way of improving organizational accountability, trust, information quality, and responsible decision-making. The study can be considered as adding to the currently increasing literature, as it combines regulatory compliance with "operational and ethical aspects" and seeks to show the importance of SEM in terms of studying the interconnectedness of the effects of data privacy regulation within an organization.