This is extremely important. Right now we have an extremely inefficient market with respect to privacy. Users don't know what policies companies have, and even if they know where to find that information, it's extremely inaccessible. Making it easy to compare services would allow users to actually distinguish based on this metric, which is the first step towards pressuring companies to actually compete on this metric.
Simplistically, this could be achieved with a set of data policy components (account information, login information, purchase information, location information, various activity information items, etc) and their policy on them in well defined terms, such as Not Applicable, Does not collect, Collects but does not share, Collects and may share, Collects and known to share. That would be the start of something beautiful.