Privacy compliance is an ongoing concern for organizations across the globe. With data privacy regulation becoming more of a challenge as more legislation is adopted worldwide, the cost of compliance has increased substantially. This makes it necessary for companies to adopt and employ privacy compliance programs.
The GDPR and CCPA is estimated to result in a total compliance cost of 122 billion USD per year across all segments of the United States economy and International Association of Privacy Professionals (IAPP) estimates a 7.8 billion USD compliance cost for global Fortune 500 companies alone.
The high cost of compliance is a direct result of requirements under data privacy laws, such as:
Of special note as regards the above requirements is DSARs. The Information Commissioner's Office (ICO) in the UK has found that DSARs are the most frequent form of data protection complaint. On average, organizations may need up to two weeks to respond to a DSAR. Data privacy compliance inevitably poses huge costs for organizations in terms of time, money, and effort.
Penalties for non-compliance under data protection laws can be severely high. The GDPR sets the maximum penalty at 20 million EUR or 4% of the organization’s global turnover in case of grave violations.
A detailed privacy compliance program along with the use of automated softwares help reduce the complexity of compliance. Read on to learn how to design a holistic privacy compliance program for your organization.
A privacy compliance program helps you maintain a culture of responsibility, transparency and build trust with your customers and business partners. Given that both your business and data privacy compliance requirements will change with time, a dynamic privacy compliance program is needed to identify and mitigate compliance risks involved when dealing with personal data.
Depending on your customer base, employees and sphere of business, your organization may be required to comply with several data privacy laws, such as the GDPR (Europe), and CCPA (California).
A comprehensive privacy compliance program will cover every data-privacy related or compliance issue that may arise at your organization. While designing your privacy compliance program, keep the following considerations in mind:
Your organization collects and holds large chunks of personal information as part of your business operations. Data privacy laws come into the picture any time you process personal data. The first step is to ensure you maintain and store personal data properly.
Your organization might provide services to customers across international borders, without having any physical presence there. This means that your personal data collection, storage, and processing may attract privacy laws of several jurisdictions. Your privacy compliance program must be forward looking to make sure you are able to comply with any new data privacy regulation.
Data breaches have become more likely with the increase in data collection and all-pervasive nature of data. Your privacy compliance program should ensure a risk-free privacy experience for your customers, business partners, and employees.
A privacy compliance program provides your organization with a suitable framework for collecting, storing, and processing personal data. Let’s run through a 10-step process to designing and implementing a program for your business.
Every organization’s privacy needs are unique and depend on various factors. The first step for designing your privacy compliance program should be to develop a basic understanding of your unique privacy needs. This may be based on your organization’s:
To help you understand your organization’s compliance requirements and the risks associated with handling data, you need to create a data map. This means collecting information about all of your organization’s processes involving data collection, storage, processing, and the purposes of the data collection.
For example, if you are gathering information for marketing purposes, record the type of marketing activities you engage in, the amount and type of data that is being collected, who will have the access to that information and how it will be used. You should pay extra special attention to properly record any sensitive customer data that you collect, such as their medical history or social security details.
Understanding the information you collect will also come in handy while addressing DSARs.
As an initial step, your privacy compliance program should be designed to be able to meet all legal compliance obligations. For this, you should determine all the applicable laws and compliances for your jurisdiction and operations. This will usually depend on the type of information you collect, the jurisdictions you operate in, where your data subjects reside, and how you process your data.
After noting the compliance requirements, formulate a compliance roadmap which can be rolled out across the organization to meet the obligations. This roadmap will assist your business in complying with the laws and must be reviewed every six months.
Depending on the size of your organization and your privacy compliance burden, you should either find and hire a Data Protection Officer (DPO) or appoint someone as a DPO from within the organization. The DPO should be trained in managing privacy related compliance across jurisdictions. Yet another assessment of the costs of ensuring data privacy is provided by the Information Technology and Innovation Foundation (ITIF), which estimates that organizations will have to spend roughly 6.4 billion USD annually in the US alone on DPO-related costs.
Your privacy compliance program should ensure that the company is complying with all applicable laws and regulations and should be communicated to both front and back-office employees within your organization.
Privacy compliance is not a one-off process and your organization should conduct data privacy impact assessments from time to time to identify and mitigate its unique data privacy related risks. Conducting these assessments will allow you to identify and control risks relating to collection, storage and processing of personal data.
Your privacy compliance program should also include provisions to insure against privacy breach. Privacy breaches are not impossible and your organization must be prepared for such an event. For this, have a clear issue reporting and case management process to ensure privacy breaches are handled appropriately. This will help your organization in avoiding costly mistakes should such a situation arise.
To protect personal data from privacy breaches, it is important to manage information flows in a secure manner. Third parties outside of your organization, such as contractors, vendors, and other service providers may get access to personal information that you store. You should ensure that these third parties comply with data privacy laws and maintain strict data security at all times. This includes your data processors, who are also legally responsible under privacy legislation such as the GDPR.
While managing privacy risks with third parties, you should identify all third parties and vendors who have access to your company’s data. You should develop a due diligence process to vet vendors and address data privacy concerns when your relationship with the third party comes to an end.
In addition to your internal processes, you may also be required to seek advice from IT experts and lawyers to ensure compliance. You should also note other resources such as technology and software you will need to implement your privacy compliance program.
The cost for storing data is getting ever-cheaper and, consequently, organizations run the risk of falling into the trap of simply retaining all sorts of data forever. Collecting large amounts of otherwise useless data poses a significant risk to your organization. Manually retaining and deleting data is a time-consuming process, so it is essential that your organization has an automated and integrated data collection, retention, and deletion program in place.
Your organization’s privacy compliance program should include a data collection, retention and deletion program to ensure information is properly organized to be easily searchable for future use and delete information which is no longer required.
With new privacy laws similar to the CCPA and the GDPR being introduced around the world, your organization needs to be up-to-date with any changes in compliance requirements. This means that it is important to update your privacy compliance program from time to time.
In addition, your privacy compliance program should be forward thinking so that it is able to address newer privacy related challenges in the future. Privacy regulations are constantly evolving and emerging in other jurisdictions, so it is important that your privacy compliance is systematic enough to be able to meet any new requirements.
Privacy compliance is a dynamic process and it is essential for your employees to be up-to-date with your organization’s data privacy compliance obligations. Within your privacy compliance program, you should also provide for formal training on privacy compliance issues. The training program should cover all the applicable laws and regulations and also discuss potential violations and their consequences.
Privacy compliance can pose a significant challenge in terms of cost and labor, with newer and stricter laws and regulations. The ITIF estimates that US companies will have to spend around 7.2 billion USD alone on addressing DSARs, deletion and rectification of data annually. These costs are down to privacy laws like the GDPR and the CCPA, which provide right of access to data subjects which must be addressed by organizations free of charge.
Manually maintaining sustainable privacy compliance in an efficient and effective manner can be a huge challenge in a dynamic business environment. Adopting automated technology and software can significantly reduce this burden. As opposed to manual compliance, this will ensure errors and mistakes do not creep in; errors which may result in huge penalties in case of non-compliance.
Privacy software will allow you to be in control of the personal data you handle at the most granular level. Automating these processes will also help you in avoiding any potential lack of internal coordination which could result in gaps in compliance. You will also be able to handle and respond to DSARs without human intervention while saving on significant costs and time. With an integrated software assistance, you can ensure compliance with all the privacy laws across the globe.
By automating several stages of your privacy compliance program, you can ensure you are always compliant with the data privacy laws in a cost-effective manner.