Consultancy firm KMPG said finding the right balance between customers' right to privacy and gaining business value could help firms take the lead through innovative online services.
Stephen Bonner, partner in information protection and business resilience at KPMG said: "Businesses are getting so much economic benefit from understanding their customers better, but that insight must come with assurances that they are not over-stepping the mark.
"In a flat, global network where e-commerce can be delivered anywhere in the world, striking that right balance of fair, but firm
regulation is what provides a competitive advantage for countries."
Christopher Graham, information commissioner at KPMG said the ICO seeks to enable the development and delivery of products without compromising privacy.
He added: "But to be an effective partner in delivering modern and innovative services, the ICO needs stronger powers, a more sustainable funding system and a clearer guarantee of independence.
Stephen Bonner believes that as the world moves towards the internet of things and the automated home, UK citizens need to be aware if someone is watching over their information.
He added: "We stand at the cusp of what could be incredibly empowering insights from data properly collected and analysed that will change the way we do medicine and commerce, creating opportunity for innovation.
"But there is also the terrifying possibility of oppression, manipulation and restriction of freedom, so there is a need for industry to embrace a proper regulatory framework."
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