A Guide to Data Privacy Management
Data privacy is a hot-button issue, with data breaches and regulatory fines in the headlines almost every week. Most CIOs, CISOs, and cybersecurity experts are well aware of the importance of data privacy. But do they have an effective plan for ensuring privacy throughout their organization?
Data privacy management offers a way for organizations to meet compliance with privacy laws, operationalize their privacy-by-design or data-minimization frameworks, and protect their valuable data. In this blog post, we’ll explain the ins and outs of the practice, as well as some key components of creating a robust data privacy management strategy.
What is data privacy management?
Data privacy management is the set of procedures that organizations use to handle data in order to safeguard sensitive information, respect individuals’ privacy rights, and meet legal requirements. It’s often part of a larger data governance program that helps companies maintain the confidentiality, integrity, and availability of their data assets.
Because data privacy regulations impose a slew of rules, maintaining compliance can be a major challenge. As such, data privacy management is often focused heavily on regulatory requirements, with tasks including:
- Conducting data protection assessments (DPAs)
- Assessing data privacy risk
- Creating data retention policies
- Creating clear and transparent privacy notices to inform data subjects of how their personal information is being used
- Asking for consent to collect consumers’ personal or sensitive data (i.e. consent management)
- Responding to data subject access requests (DSAR)
- Auditing where personal data is stored and how it is processed
- Implementing data privacy and security measures
- Responding to data breaches
- And more.
Data privacy management vs. data security management: what’s the difference?
Data privacy and data security are often used interchangeably, but they’re more like two sides of the same coin. Data security involves the protection of data assets from cyberattacks, outages, and exploitation, just as physical security involves the protection of physical assets. Data privacy, on the other hand, ensures that data is processed correctly, ethically, and in accordance with both the relevant regulations and the data subject’s wishes. Robust data security is generally needed to ensure effective data privacy practices.
Another way to conceptualize it is that data privacy management and data security management focus on complementary but distinct activities. Data privacy management is generally more concerned with understanding legal requirements and establishing policies and processes. Some technical know-how is involved — for instance, creating universal opt-out mechanisms to comply with certain regulations around data processing — but the overall focus is on creating an effective and legally compliant in-house privacy program.
Data security management, on the other hand, focuses more on implementing technical and organizational safeguards. It requires an in-depth understanding of common cybersecurity measures like encryption, role-based access control (RBAC), the principle of least privilege, and other data protection measures.
Due to the rapidly changing digital landscape and the nature of modern workplaces, data privacy management and data security management may fall under the purview of many different positions, including Chief Data Officers (CDOs), Chief Information Security Officers (CISOs) and Chief Privacy Officers (CPOs).
Why is data privacy management important?
The more common it is for companies to process, collect, and store personal data, the more important privacy management becomes. Without data privacy initiatives, organizations and individuals lack the ability to safeguard their sensitive data from unauthorized access, breaches, and loss. Below, we’ll outline a few of the top reasons to take a careful, measured approach to data privacy management.
To meet regulatory compliance. The most common reason to invest in comprehensive data privacy management is to keep abreast of regulatory requirements and avoid penalties. Adhering to data protection regulations is now a legal obligation in the majority of countries — and recent fines like Meta’s €1.2 billion GDPR penalty show the staggering cost of noncompliance.
To avoid financial losses. Beyond potential fines and legal expenses for noncompliance with data protection regulations, data breaches can lead to litigation, loss of intellectual property, and lost revenue. Experts say that breaches can also cause a ripple effect in the supply chain, amplifying initial losses 25 times over for a company’s business ecosystem.
To prevent reputational damage. Maintaining strong data privacy practices can significantly enhance an organization’s reputation, just as news of a public breach can cause major issues for a brand or service. As research shows, publicly traded companies experience an average 7.5% decline in their stock values after a data breach. For a major enterprise, this can amount to many millions of dollars of losses for shareholders.
To safeguard consumer data and build customer trust. Apart from causing legal and reputational problems, mishandling personal data can severely erode user trust. Consumers are more likely to engage with businesses that respect privacy and safeguard customer data.
To gain a competitive advantage. Lastly, organizations that prioritize data privacy may be able to use it as a competitive advantage. Companies can stand out from the crowd by highlighting their commitment to protecting customer data, including B2B customers. Additionally, well-managed data can lead to improved decision-making and operational efficiency within the organization.
Data privacy management by regulation
What are the most important data privacy laws? Simply put, the ones that apply to your business. Depending on your jurisdiction, industry, and organization size, you may need to comply with one or several different regulations. Here are a few of the most common.
The GDPR. The EU’s General Data Protection Regulation mandates informed consent for data collection and enforces stringent data security measures. It also encourages data minimization and privacy by design, and it requires organizations to conduct data protection impact assessments (DPIAs) for high-risk activities. By empowering individuals with new data subject rights, the regulation aims to protect the personal data of people in the European Union.
HIPAA. The Health Insurance Portability and Accountability Act, a US federal law, safeguards many categories of healthcare data by setting privacy and security standards. The regulation also defines protected health information (PHI), mandates breach notifications, and implements mandatory training and awareness programs. Healthcare providers and organizations dealing with PHI will need to abide by HIPAA closely to ensure the confidentiality and security of patients’ medical information.
The CCPA and CPRA. As the first state-level data privacy law in the United States, the California Consumer Privacy Act was the inspiration for many subsequent US state data privacy laws. The CCPA grants California residents rights to know, opt-out of data sales, and promotes data minimization, while the California Privacy Rights Act extends these rights and introduces enhanced privacy protections.
The TDPSA. One surprising contender? The Texas Data Privacy and Security Act. The TDPSA’s wide applicability — covering almost any entity that doesn’t meet the US Small Business Administration’s definition of a small business — means many organizations that don’t otherwise have to worry about their privacy practices will be required to meet data privacy compliance.
Creating a data privacy management strategy
An effective data privacy management strategy will guide organizations in safeguarding the confidentiality, integrity, and availability of personal data — while also adhering to legal obligations and industry standards. It’s no small feat, but luckily there are some guiding principles to get you started.
Know your data. Regularly engage in audits, data discovery, and data inventories to ensure you know where all your data assets are. Make sure you also understand the specific categories of data you collect, especially personal identifiable information (PII). Seek to understand the common privacy challenges to cloud data and data in on-prem storage locations.
Understand the regulatory landscape. Different regulations will call for different privacy programs. For instance, some state-level data protection laws require an opt-out mechanism for the processing of sensitive data, while others require consumers to actively opt in before processing can take place. Knowing the exact parameters for compliance — and consulting legal experts when necessary — is key to an effective strategy.
Implement privacy by design and data minimization frameworks. Make sure to proactively incorporate data privacy and security measures into your organization’s operations. Keep data processing activities and data retention to a minimum, and perform risk assessments and privacy impact assessments as necessary.
Build a privacy-conscious culture. There are many ways to build a strong culture of data privacy in your organization. Regular employee training, clear communication, and leadership from the C suite are all useful. Encouraging open dialogue about privacy concerns and incidents, as well as promoting a non-punitive approach to reporting breaches, can further strengthen your company’s culture.
Evaluate automated tools. Advances in AI and machine learning (ML) are allowing companies to tackle cybersecurity threats with more precision, speed, and efficiency. With the right AI tools, organizations can not only streamline data protection processes but also gain real-time insights into data handling practices to identify potential problems and vulnerabilities. Make sure to consider the AI capabilities of the privacy management software on the market today.
Simplify data privacy and compliance with ShardSecure
Regardless of where your data is stored, the ShardSecure platform offers benefits for your company’s data privacy and protection efforts. Our technology provides advanced data privacy, security, and resilience, offering an innovative approach to file-level encryption that protects data from unauthorized access. As a unified, multi-protocol platform that operates across multiple clouds, our platform also does not introduce significant performance drawbacks or require existing workflows to be redesigned.
ShardSecure meets the European Data Protection Board’s requirements as a supplemental technology to enable cross-border data transfers under the GDPR. Our company was also recently named a 2023 Gartner® Cool Vendor in Privacy.
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