As individuals, we have a lot to hold up when it comes to data privacy, and it is particularly important to know about it in detail. It is not just to gain knowledge but to help ourselves to keep our data safe from all possible risks of getting stolen. But what is Data Privacy?
Well, basically, data privacy is how a piece of information or data is controlled based on its importance. For instance, sharing information with a stranger can be completely different than sharing your details for opening a bank account. You may have to give a lot of details about yourself while opening a bank account, more than just your name, it is mandatory. But when it comes to sharing information about yourself to a stranger, it is completely your decision about how much details you must share with them; nothing is mandatory here.
Since we are in the digital age, we are typically putting the concept of data privacy as critical personal information, which is divided into two parts, i.e., Personally Identifiable Information (PII) and Personal Health Information (PHI). Now under this, there is a Social Security number that comprises medical, financial records. Along with this, it also includes information about our credit cards, bank details, address, birthdates, and other such sensitive information.
On the contrary, for businesses, data privacy is something beyond PII. The information stored about the employees and customers who are part of the business is much more than what is stored in the PII. It includes information such as proprietary research, data development, and other financial information about recent investments. Now the ultimate question that arises is why it is important to keep your data private.
Importance of Data Privacy
A major reason why companies and organizations consider data privacy important is to avoid fines. Companies that do not follow the data privacy regulations are charged a fine for $10M and sometimes are penalized for 20 years. When private data is breached, it can lead to fraud and scams. Here are a few major reasons why it is important to maintain data privacy.
Data Breach can Affect the Business
Once you apply data privacy and regulations, the business must fulfill certain legal requirements. One of those is the implementation of a robust security safeguard that ensures data privacy. Once these measures are applied, the chances of security threats decrease, and the businesses don’t suffer losses in the revenue. On average, the cost of a data breach is $3.92M approx., which can be neglected with the help of a proper data regulatory system.
Protects Customer Privacy and Improves Brand Value
As we all know that data breach leads to the stealing of valuable information of the customers, which makes it directly questionable about the security policies of the data owners. With the stolen information, it becomes easy for the hackers to use this sensitive information to commit various crimes such as identity theft and credit card fraud. A data breach can damage a company’s reputation very easily, which directly impacts its brand value. When the customers trust the companies and give them access to their important data, they expect the organization to protect it in every manner.
Supports Code of Ethics and Gives Competitive Advantage
A lot of organizations follow the code of ethics. Companies that have not formed the code of ethics have at least certain bi-laws and memorandums that they follow. If the companies do not follow basic business ethics, they will not be staying stable in the business. One of the code ethics states that the information provided by the customers and the employees is supposed to be responsibly handled and only used for business purposes. Many of us are always concerned about how are the companies using their data. Apart from that, 81% of people believe that they have no control over their data. So if the businesses are sincerely following data privacy regulations, then the companies have a competitive advantage over organizations that don’t take this matter seriously.
How to Setup a Systematic Compliance of Regulations
If the organization has not made systematic compliance, it is very necessary to make it as soon as possible. It might take a lot of time and effort to be formed, but it is very necessary to bring it into existence as soon as possible. Here is what companies can do to make systematic compliance of regulations:
Make a Compliance Strategy and Higher Experts
Any compliance plan cannot be properly executed without a proper strategy. The strategy complies with data privacy agreement to its core, along with being measurable and integrated. The strategy can be further developed with a set of robust principal and work ethics, followed by a proper documentation process. It is particularly important to define all measures properly so that the personal data is completely protected. Many regulations must have complied, and it’s nearly impossible to keep a check on all of them. To keep a proper track of all of them, there is a team of experts that are trained in the General Data Protection Regulation (GDPR) and Health Insurance Portability and Accountability Act (HIPAA) regulations. These experts are also known as Subject Matter Experts (SMEs).
Have Plan to Deal with Breaches and Save Documentation
Even if all the regulatory policies are followed precisely, the systems cannot be completely protected from cyber-attacks and data breaches. Every organization must have a highly effective response plan for a data breach. All the processes and plans that are followed are supposed to be properly documented, and it should always be readily available. There should be an employee who assists solely in this document management process.
People across the globe are extremely concerned about data privacy. To avoid harmful consequences after a data breach, it is particularly important to maintain a systematic plan of Data Privacy and follow them efficiently. Since customers hold a lot of trust in the organizations, the companies need to follow the code of ethics and the data privacy regulation. If the companies follow these rules, it keeps your business away from facing penalties and saves the business and its reputation.