In the contemporary landscape of data-driven enterprises, a paramount obstacle confronting businesses is the proficient management of data. Amidst the surge in data accumulation and analysis, safeguarding consumer data privacy emerges as an ongoing imperative. Data breaches, wielding repercussions that transcend mere financial ramifications, cast a deleterious shadow upon both corporate entities and their clientele, fostering a milieu of distrust and trepidation. Recognising the gravity of recent high-profile breaches and an escalating consciousness surrounding personal privacy, regulatory bodies have embarked upon the enactment of robust legislative frameworks aimed at fortifying and preserving the sanctity of individual rights and privacy.
Data privacy versus data security
Data privacy and data security are two interlinked yet distinct aspects of a company’s data governance framework.
Data privacy focuses on protecting individual rights related to their data. It allows users to control their information. For companies, maintaining data privacy means implementing protocols that enable users to manage their data in accordance with relevant privacy regulations.
Conversely, data security is about protecting data from unauthorised access and misuse. Companies prioritise data security by setting up safeguards against external threats and internal breaches.
Data security enhances data privacy by ensuring that only authorised individuals can access personal data for legitimate reasons. Likewise, data privacy strengthens data security by specifying the requirements for determining “authorised individuals” and the valid justifications for accessing a particular dataset.
Regulatory compliance
We live in a world driven by data. Every consumer leaves a data trail as they go about their daily lives, from the websites they visit to the online transactions they make. As life becomes increasingly digital, more and more of this personal information is shared with organisations, leading to elevated fears about privacy and security.
To meet these concerns, the European Union introduced the General Data Protection Regulation (GDPR), which became law in 2018. Since then many other countries and states have enacted, or are planning, similar legislation to protect personal information.
This makes understanding the underlying principles behind the GDPR vital for organisations across the globe. Even if you are currently not subject to GDPR-style legislation, being compliant is good practise and should be at the heart of your data strategies and data governance projects, helping deliver reassurance to citizens, consumers and partners.
The principles behind the GDPR
At the core of the General Data Protection Regulation (GDPR) lie seven fundamental principles, delineating the responsibilities of organisations in handling and safeguarding the personal data they gather. These principles serve as guiding pillars:
- Lawfulness, Fairness, and Transparency: The processing of personal data must adhere to lawful, fair, and transparent practices, ensuring clarity for the data subject, whether a citizen or consumer.
- Purpose Limitation: Organisations are bound to process data solely for legitimate purposes explicitly consented to by the data subject during collection.
- Data Minimisation: Emphasizing prudence, organisations should only collect and process the minimum necessary data for the agreed-upon purposes.
- Accuracy: Organisations are duty-bound to maintain the accuracy and currency of personal data, ensuring its reliability.
- Storage Limitation: Personally identifying data may only be retained for the duration necessary for the specified purpose, promoting responsible data management.
- Integrity and Confidentiality: Data processing must prioritise robust security measures to ensure the integrity, confidentiality, and safeguarding of personal data, incorporating encryption where applicable.
- Accountability: Organisations bear the onus of demonstrating compliance with GDPR principles, underscoring the importance of transparency and accountability in data handling practices.
In essence, the GDPR fortifies the rights of citizens and consumers concerning their data. These rights encompass:
- Explicit consent from individuals for the collection of personal data.
- Simplified access to personal data stored by organisations.
- Rights to rectify erroneous data and request its deletion if desired.
- The prerogative to object to the utilisation of personal data for individual profiling.
- The right to data portability, facilitating the transfer of personal data between service providers.
The Impact of GDPR Outside the EU
The GDPR, hailed as the inaugural and most all-encompassing global data privacy statute, has wielded considerable influence beyond the confines of the European Union. Notably, several U.S. states have enacted their own statutes, drawing inspiration from the foundational tenets of GDPR:
California
In 2018, California introduced the California Consumer Privacy Act (CCPA), later supplemented by the California Privacy Rights Act in 2020. These acts empower Californian residents with heightened autonomy over their personal data, including the prerogative to ascertain data collection, receive notifications of data sharing or sales, and exert control over data commercialization.
Colorado
The Colorado Privacy Act, which was implemented on July 1, 2023, affirms the privacy rights of consumers while imposing obligations on businesses to uphold the sanctity of personal data. In addition, it sanctions enforcement mechanisms to address cases of non-compliance.
Connecticut
As of July 1, 2023, this legislation established a framework for the management and processing of personal data, outlining both organisational obligations and consumer rights in relation to the use of data.
Utah
The Utah Consumer Privacy Act, which went into effect on December 31, 2023, provides consumers with transparency regarding data collected by companies and requires specific entities to ensure that personal information is safeguarded.
Virginia
Effective January 1, 2023, this legislation outlined organisational obligations and sets standards for privacy protection, while granting consumers rights related to their data.
Alongside these five states, legislation is currently being debated in some others too, meaning a large proportion of the population could be protected through data privacy legislation.
As we continue to navigate the digital landscape, the importance of data privacy and regulatory compliance will only continue to grow.
