On Digital Transformation and Ethics. Interview with Eberhard Schnebel
” Whether an organization is transparent and fair is, first of all, a very emotional category. This is something that customers and strategic partners decide by their own judgment and feelings.
The emotional communication of these values is the central task.
However, there must also be minimum standards. It must be possible to check whether digital processes are fair and transparent. An inspection can be carried out for these minimum standards either as certification or as an onsite inspection. This depends on the complexity of the systems.” — Eberhard Schnebel.
I have interviewed Eberhard Schnebel, Group Risk Management at Commerzbank AG, where he led the project “Data Ethics / Digital Ethics” to establish aspects of corporate ethics regarding digitalization, Big Data and AI in the financial industry. We talked about Digital Transformation and Ethics.
Stay safe!
RVZ
Q1. What is Digital Ethics?
Eberhard Schnebel: Digital Ethics is the communication of applying ethical or social ideas to digital technology and making them a reality with digital technology. In the past, this was done in the context of Technology Assessment. The social and technological aspects are strictly separated, and digital technology’s instrumental use is systematically assessed from an ethical perspective.
Today’s approach sees digital development as an integrated part of our social life. It is important to transfer our social ideas into this digital reality and understand which digital contexts we would like to change.
This new approach understands Digital Ethics as part of the digital transformation itself. Digital Ethics thus directly influences our life with digital technology.
Q2. Why should Data Ethics and Digital Ethics become a core element of a company’s digital strategy?
Eberhard Schnebel: Data, BigData, and digital technologies are changing the core elements of many companies’ business models. New communication and risk management tasks are emerging. These must be taken into account in many areas and professionally integrated into the organization.
Data Ethics and Digital Ethics create exactly this extension of organizational routines, which will contribute to the company’s success in the future. They create awareness of these elements’ new reality within the company – from marketing and customer communication to product design and data scientists.
Q3. In Europe, there are many legal precautions and increasing rules on how to adopt the issues of digital transformation and data ethics, e.g., EU-GDPR, EU-Trustworthy-AI, the recommendations of the Data Ethics Commission of the German government. What does this mean for an organization?
Eberhard Schnebel: Dealing with these developments and regulations is very important, given the rapid development of data technology and the rapid new possibilities for building up business models. There are always many grey areas where technology needs completely new solutions or where regulations have become blurred. Therefore, organizations must go far beyond a pure compliance system and consider integrating the requirements into a system as soon as they design it. In addition to pure “legal compliance”, organizations need an ethical policy that defines how employees must deal with fuzzy requirements. Such a policy helps to avoid various risks that would result from software development.
This is about creating the organizational conditions for living these ideas and increased awareness and readiness for social concerns in concrete terms.
Q4 How is it possible for companies to establish Data Ethics and Digital Ethics as an essential factor in their business model?
Eberhard Schnebel: Data Ethics and Digital Ethics define what needs to be done and what does not. On the other hand, they also define how products are set up and designed, and used. This is important to be able to sell everything to customers later in a way that satisfies them. When everyone – customers, employees, and management – has the same understanding of the company’s digital products, services, and tools.
Besides, the company must also make central organizational preparations, such as setting up a governance board or creating a framework for managing ethical risks.
Q5. What are the key challenges to achieving this in practice?
Eberhard Schnebel: Everyone who comes into contact with data or AI products should understand the framework of regulations applicable to a company’s data and AI ethics. We create a culture in which a data and AI ethics strategy can be successfully implemented and maintained. Therefore, it is necessary to educate and train employees, enabling them to raise important issues at key points and bring the main concerns to the appropriate advisory body.
Q6. What does “transparency” in the application practice mean for an organization?
Eberhard Schnebel: In an organization or company, “transparency” is very much about communication and less about the actual facts. Transparency is anything where others believe that they can sufficiently understand and comprehend your reasons and background. The creation of an emotional connection is the central point here. At the same time, it must be clear to the Governance Board and product designers and data scientists what it means to make this transparency factual.
Q7. What does “fairness” mean in the daily routine for an organization?
Eberhard Schnebel: Fairness is the most challenging term in Digital Ethics. Because we are seeing more and more transparently the tensions between the individual elements of digitization created by transparency, this must be offset by conveying fairness.
But fairness is also when new information asymmetries between companies and customers are used so that they always lead to an advantage for the customer. This advantage must, of course, be experienced by them exactly as such, which in turn requires very emotional communication. The tension between transparency and fairness, in turn, is a real ethical debate (see Nuffield Report).
Q8. Who will review whether an organization is transparent and fair?
Eberhard Schnebel: Whether an organization is transparent and fair is, first of all, a very emotional category. This is something that customers and strategic partners decide by their own judgment and feelings. The emotional communication of these values is the central task.
However, there must also be minimum standards. It must be possible to check whether digital processes are fair and transparent. An inspection can be carried out for these minimum standards either as certification or as an onsite inspection. This depends on the complexity of the systems.
Q9 Hardly any other technology is as cross-product and cross-industry as Artificial Intelligence (AI). Is it possible to achieve responsible use of AI?
Eberhard Schnebel: Yes, I think so, but this can only happen from within and not as a “regulation”. Just as the “honorable merchant” is supposed to lead to ensuring responsible use of the economy, an inner understanding of digitization can also emerge.
To achieve this, we must ensure that this technology’s initial fascination, which still embraces us, is transformed. It must give way to a more sober view of what can be expected and what it will be used for. We must find quality criteria that describe its “goodness”.
But we also need visible and comprehensible analyses of the systems, including discussing the ethical tasks involved. Here, a new system of ethical screening can provide the insights needed for societal evaluation and discussion.
Q10. In your new book (*), you talk about “Management by Digital Excellence Ethics”. What do you mean by this?
Eberhard Schnebel: In the end, three building blocks must come together in Digital Ethics:
1. Digital Ethics adjusted compliance system that ensures that minimum standards are met, and risks are avoided.
2. Analytical module that ensures the necessary transparency and flow of ethical information for system design.
3. Commitment of management and product designers to communicate this ethical content to customers and business partners.
Suppose the link can be made between digital technologies’ quality use, appropriate meaning, and communicating their benefits. In that case, this is Digital Excellence Ethics because it successfully translates the excellent use of digital technology to integrate social ideas into business models.
Q11 Do you have anything to add?
Eberhard Schnebel: Again, we want to encourage the connection between ethical instruments and ethical risk management to be communicative and not just organizational with this book. Those involved must be emotionally involved. If we want to find Digital Ethics “on the engine” in the end, then only as an inner ethical element, as mindfulness.
———————————————————–
Dr. habil. Eberhard Schnebel
Ethical Advisor. Frankfurt Big Data Lab, Goethe University Frankfurt, Germany.
Eberhard Schnebel is a philosopher, economist and theologian. He received his PhD in 1995 from the Faculty of Theology of the LMU in Munich and his habilitation in 2013 at the Faculty of Philosophy of the LMU. His work combines Theory of Action, System-Theory and Ethics as foundations for responsibility in business and management.
Eberhard Schnebel is teaching Business Ethics at Goethe University in Frankfurt since 2013. Since 2016 he is developing “Digital Ethics” to integrate ethical communication structures into design processes of digitization and Artificial Intelligence.
He is a member of the Executive Committee of the “European Business Ethics Network” (EBEN). This network is engaged in the establishment of a common European understanding of ethics as prerequisite for a converging European economy. He is also member of the research team on Z-Inspection®, working on assessing Trustworthy AI in practice.
Eberhard Schnebel works full-time at Commerzbank AG, Group Risk Management, where he led the project “Data Ethics / Digital Ethics” to establish aspects of corporate ethics regarding digitalization, Big Data and AI in the financial industry. Prior to that, he led the project “Business Ethics and Finance Ethics” to introduce ethics as a tool for increasing management efficiency and accountability.
Resources
(*) A Valuable Future. Digital Ethics. by Dr. Eberhard Schnebel and Thomas Szabo. digital excellence, July 2020
– Z-Inspection®: A process to assess Trustworthy AI.
Related Posts
Follow us on Twitter: odbmsorg
