Data privacy is inherently connected to ethics, trust and technology and protecting all materials that pass from your executive to your board should be something that’s at the top of your cybersecurity list. Data privacy is a critical component to a business’s value. All companies must meet certain compliance requirements, or they can face enormous fines, lengthy penalties and, ultimately, the loss of business relationships. In light of GDPR in Europe, this is even more true, and promises to be an even bigger issue in the coming years.
Data breaches damage businesses, individuals and customers. They also have a major impact on ethics, trust and the company’s reputation. Modern business requires secure communication and collaboration tools and strategies to ensure the highest possible level of data privacy.
Data Breaches Damage Business
Data privacy is a global issue. It’s a legal requirement and an expectation that companies will implement strong safeguards and data protection. Implementing security controls reduces the number of – and the potential for – security incidents that can result in data privacy breaches. The fewer breaches a company encounters, the easier it is for shareholders and stakeholders to maintain trust.
In addition to fines, multiyear penalties and civil lawsuits, companies risk damage to their brand and reputation. According to a Forbes Insights report, 46% of companies encountered reputational loss and damage to their brands after a data privacy breach. Vast concerns about data breaches should motivate companies to be explicit in their communications that protecting their consumers’ privacy is one of their primary goals. Companies will need to make their commitment to data privacy clear in their communications and also find ways to demonstrate their faithfulness to their principles.
Consumers desire to have some control over the entities and individuals who are allowed to have personal information about them. In particular, they want to have some degree of control over the specific types of information that others have about them. Businesses that can provide such controls will help build emotional connections to their brand, and in turn, increase the brand’s value.
Breaches Damage Individuals
Everyone has data out on the web about themselves. Often, we’re not as aware as we should be about how it’s being collected, stored, processed, transmitted, accessed, shared and disposed of.
Historically, companies and organizations have taken an “as needed” approach to applying data security controls. The prevalence and severity of data breaches are calling into question how companies can provide comprehensive, strong security controls over data throughout the enterprise. A good place to start is by protecting personal data to avoid breaches that hurt customers.
For example, in the second quarter of 2018, Kaspersky Labs solutions blocked 962,947,023 cyberattacks that were launched from the internet in 187 countries around the world. If hackers had been successful, the personal data of the affected people could have been used in unlimited ways for years to come.
It’s often a tragedy that calls the seriousness of data privacy to our attention, which was the case when actress Rebecca Schaeffer was shot to death in 1989 when a wayward fan retrieved her home address from the California State Department of Transportation. The California government responded with one of the first state privacy laws in the United States — the “Driver’s Privacy Protection Act” of 1997.
Breaches Damage Customers
Technology has given the general public much freedom. And where there is much freedom, there is much responsibility. The millennial generation has learned more about data privacy throughout their school years than previous generations. As a result, they hold increased expectations as they move into adulthood that they have increasing rights over their personal data and are entitled to have some say over how it’s collected, utilized, evaluated and shared.
Activists groups are forming and setting agendas to influence legislation so that their privacy rights are protected. Growing sentiments around data privacy are increasing the awareness around data protection and the right to control our own personal data.
In 2017, Baringa Partners conducted a survey of banking, insurance, energy, television and internet providers. The results showed that 30% of people would switch providers immediately in the event of a data breach. Another 25% of consumers said that they’d wait for a media response before changing providers or consider others’ opinions about it first. Essentially, over half of consumers would consider switching to another provider in the event of a data breach. That’s a pretty strong statement about consumer loyalty and consumers’ expectations about data privacy.
Data Privacy Ensures Ethics and Trust
Companies are required to have a code of ethics that outlines how the company will handle confidential information. Typically, the code will say something along the lines of the fact that the company won’t use personal information in a business act that would produce harm and that it will only be used for business purposes.
Data privacy ensures ethics and trust for investors, the public and customers. Companies and other types of organizations that don’t develop strong data privacy protection and then experience a breach, will lose trust in the company, which will result in lower profits and drive customers back to their competitors.
The Importance of Secure File-Sharing and Data Privacy for Boards and Executive Teams
Data privacy is a company-wide issue that starts at the top with the board and executives where the most highly confidential information lies. Some companies are afraid of innovation because of the security risks that come with it. On the contrary, innovation provides an opportunity to prove that security enhances innovation rather than stifle it, as it takes greater innovation to include strong security measures in programs and processes. Security measures for data privacy should be a standard requirement for any new technology or service that involves data privacy.
Data privacy has become a large enough concern that boards and executives should refrain from using personal or business email accounts and random file-sharing apps when working on board business. That’s simply too risky.
Board and executive work require a highly secure distribution method like Diligent Corporation’s File-Sharing Tool to protect confidential board and company information. Data privacy is a modern problem that requires a modern solution for secure file-sharing. Diligent’s Secure File-Sharing Tool locks down the security of your data while it’s sitting there and while it’s en route to the receiver. Strong encryption and granular access controls allow board directors and executives to share confidential information with full confidence that their communications are completely secure.
Diligent File Sharing allows cloud-based communication with hardened security features that ensure the integrity of data and uncompromised collaboration. Diligent Corporation is the modern governance company that plans to be the front-runner in innovation now and in the future.