The move to the cloud and the digitization of the corporate record has been great news for corporate secretaries and compliance teams in general – good news because it not only makes their jobs easier thanks to less manual handling, but also because it, in turn, allows the time and space for them to take a more proactive approach to compliance and governance. There is less reactive jumping at deadlines, more strategic planning and getting ahead for growth once technology is embedded in an organization’s processes.
Digital records are also much easier to work with; there is less need to use traditional mail to get documents to directors and signatories, and less physical paperwork to store. Those miles of filing cabinets at HQ can become a thing of the past. It also means there’s theoretically no limit to the size of files you can share – an end to those pesky messages about the attachment being too large to send.
However, as with all things digital, this ease of doing business does not come risk-free. Without a means of secure file sharing for entity management, entities risk exposing confidential business information and having that information fall into the wrong hands.
What is file-sharing security?
Sharing files electronically – that is, sending files by email or via a cloud-based server – has become an everyday occurrence in modern business. We don’t think twice about attaching a file to an email, or sending a link to an online folder to share information. However, file sharing can introduce risks into an organization’s infrastructure. It can result in malware infections, expose the organization to hacking attempts, or result in a loss or exposure of sensitive information.
This is where secure file sharing becomes important for an organization’s data. Secure file sharing, also known as protected file sharing, refers to the process of sharing one or more files between different users or organizations securely, privately or within a protected mode by using encryption algorithms.
File transfer encryption helps to prevent an outside party from being able to read and understand what’s being transferred. The encryption scrambles data for transfer, then decrypts it back to a readable form once it’s reached its destination. It’s essential for organizations storing and sharing files via the cloud, as it helps to protect confidential and sensitive information.
What are you risking when you share files electronically?
Research that analyzed 100 million files shared on the leading public cloud applications showed sensitive enterprise data is leaving company networks via web-based file-sharing services at a staggering rate, according to Digital Guardian. The survey found employees store an average of 2,037 files in the cloud; 20% of those that were “broadly shared” through file-sharing services included some form of regulated data.
Employees may not be purposely sharing regulated or confidential information via these platforms, but it happens easily and often. The bulk of documents that form the corporate record are sensitive or confidential in nature – especially when we’re talking about board documents – so these files must be handled carefully. Finding a way forward with secure file sharing helps to mitigate the following risks.
Data leaks aren’t just about malicious acts; information can accidentally be sent to the wrong people quite easily. How many times have you thought you sent an email to Jim in sales, but you actually sent it to your brother Jim, whom you email from your work account? Now think of the number of times that happens on an organizational level, and the sorts of files that might accidentally find their way outside the business.
While most of the receivers of that information will delete and move on, the risk is that confidential and sensitive business plans or information that could impact investors could easily be leaked outside the company. Using secure file-sharing technology for entity management helps to ensure regulatory information remains tightly controlled and accessible only to those who should see it.
As soon as anything goes online, it’s at risk of being found by hackers – and hackers know that getting their hands on sensitive corporate information can be very lucrative indeed. Cybersecurity best practices don’t just involve setting a firewall around your own entity’s infrastructure, they also cover how you transmit data and files to and from your own network. The fact is that, without security measures in place, any files in the cloud are among the most susceptible to being hacked. Experts advise the best form of security against the threat of hacking into files stored in the cloud is to ensure data is both encrypted and transmitted over a secure connection to prevent outsiders from accessing the cloud’s metadata as well.
No control over your own data
Essentially, without setting up secure file sharing for entity management, your organization places its entire information system at risk. Relying on external security practices means you don’t have any control over your own data because you sign over the terms to the cloud-based storage facility. It’s best to take control of your own information by deploying secure file-sharing technology for entity management, and help to mitigate these and many more of the risks of sharing files online.
Secure file-sharing technology for entity management elevates compliance
Even with these security risks, secure file sharing for entity management is an essential step in the digitization of the corporate record and compliance activities. It helps to mitigate risk and enhance collaboration in board meeting preparation and other highly sensitive communications by keeping that information safe from prying eyes – its benefits outweigh its costs in most instances. Take, for example, preparing for board meetings. Good board governance depends on robust communications, security, compliance and efficiency. Combining a secure entity management system and board portal with secure file-sharing technology helps the corporate secretary to secure and automate the collation, distribution and management of board meeting materials.
Diligent’s secure file-sharing and secure meeting workflow technology enables organizations to take secure file sharing for entity management to the next level. By integrating seamlessly with both Diligent Entities and Diligent Boards, the ecosystem creates the Governance Cloud, an enterprise governance management solution enabling best-in-class governance. Get in touch and schedule a demo to see how Diligent’s secure file-sharing technology for entity management can help your organization to create a data feedback and sharing loop that elevates your governance and compliance processes.