Theoretical Explanations for Firms' Information Privacy Behaviors

Information privacy is an important information management issue that is increasingly challenging managers and policy makers. While many studies have investigated information privacy as an individual, sectoral, or national level phenomenon, there is a gap in our understanding of organizational approaches to developing and implementing policies and programs to manage customer information privacy. Information systems research lacks theory to explain firm level information privacy behaviors. This article argues for an expanded repertoire of theories to be applied to investigating information privacy, especially the role that the pursuit of competitive necessity versus competitive advantage plays in explaining organizational level behavior. The authors outline how the Institutional Approach (IA) and the Resource-Based View (RBV) of the firm offer compelling theoretical explanations for firms’ behaviors and should be applied to privacy research within the information systems area.