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Although many countries have been implementing stricter privacy laws for years, most companies have not yet complied. Regulatory noncompliance may be cheaper in the short run, but if you don’t make an effort to bring your organization up to speed, you could face high fines and a tarnished reputation.
Privacy laws require your company to invest in data security and monitor your cloud environment, but this is challenging when you have limited resources and an ever-growing list of high-risk vulnerabilities. To solve this problem, some organizations have implemented data posture management to automate monitoring and improve their compliance.
Data Privacy Laws Have Been Around for Years
In 2016, European countries adopted the General Data Protection Regulation (GDPR), which became effective in 2018. The GDPR requires companies to handle consumers’ personal information securely, so that personal information cannot be traced to the consumer. Companies must minimize the collection of consumer data, and any data that they do collect must be safe from unauthorized views. The regulations also guarantee that users may request access or alterations to their data.
The California Consumer Privacy Act (CCPA), which was also implemented in 2018, gives California consumers the right to be notified when companies collect data on them. They can also access the data, forbid their information from being sold, and request that data be deleted. The California Privacy Rights Act (CPRA) is an amendment to the CCPA that created stricter requirements. It was adopted in 2020 and came into effect in January 2023.
Other countries have adopted similar measures, each with the goal of better securing consumer data. As more companies collect consumer data, governments have become more concerned with protecting that data, particularly personally identifying information. While there has so far been some leeway due to the gaps between when the measures were adopted and when they began to be enforced, those grace periods are ending.
Most Companies Are Failing on Regulatory Compliance
These measures were designed to reduce the risk of consumers’ data exposure; however, as of 2022 at least 91% of companies across industries were unprepared for the GDPR and CCPA. So far, 1462 GDPR fines have come to over $2.5 billion. Fines for noncompliance pack a punch. The CPRA’s maximum fine per violation is $7,500 , and a violation may pertain to a single customer. When companies work with hundreds or thousands of customers, the fine grows dramatically.
Reports show that over half of companies who are in the EU or California know they are required to comply with these stricter regulations, but they do not provide consumers with any methods of actually controlling their data. This is considered an intentional violation, which incurs higher fines than an unintentional violation. Some companies are also still selling consumer information despite provisions in the laws against it, which led to a $1.2 million fine for Sephora, the first major violator.
Part of the problem is that around 37% of companies are still using manual processes to manage their data security, which is time consuming and can be expensive. Privacy laws require that companies take special care to keep consumer data safe from attack, so it’s important to keep data locked down to every extent possible. Financial concerns and limited personnel will affect your ability to comply with regulations, so your company will have to find ways to ensure consumer privacy at the lowest possible cost to balance compliance responsibilities with available resources.
Developing an Effective Data Security and Compliance Strategy
To raise your odds of success, consider an automated monitoring solution suggests AdFixus. Implementing monitoring will relieve some of the responsibility from your security team, leaving them more able to deal with larger projects. Monitoring can also alert you if there is any suspicious activity, allowing you to act quickly and avoid data exposure.
You should also consider using real-time data classification, which will sort your most sensitive data and isolate it from more accessible, less sensitive data. Set security policies and train employees to ensure they know and follow company policy. Limit employee access only to data that they need to do their jobs effectively, which will prevent social engineering or phishing attacks from gaining unlimited access to your company’s data.
Remember that although cloud service providers protect their servers and networks from attack, they do not necessarily take extra measures to protect your data. Any of your access points are your own responsibility, and they are vulnerable to attack. If your company’s cloud environment does experience a breach, be sure to have an incident response plan that includes notifying customers as soon as possible and prompt patching.
Most companies have not yet become compliant with privacy laws, but they are running out of time to remedy their violations. These laws, even the CPRA, are now fully effective and enforced. If your company does not prioritize compliance, you risk both the usual costs of a breach and the high fines for violations. Even if the upfront costs are high, be sure to follow the laws relevant to your company’s location to avoid even steeper noncompliance costs.
