What is Data Compliance?

Data compliance refers to the policies, procedures, and technologies organizations implement to sustain data privacy and security compliance. It involves appropriately governing sensitive information to meet enterprise business rules and legal and governmental regulations.

Sensitive data encompasses customers’ details, employees’ confidential records, financial information, intellectual property, etc. As data volumes and diversity grow exponentially, organizations are accountable for properly managing access to, handling, and protecting this information.

Data compliance promotes consumer trust and organizational resilience by ensuring sensitive information remains secure yet usable for business objectives. A compliance-centric approach to data helps avoid breaches, fines, and reputational damages.

Why do we need data compliance?

Organizations must establish robust data privacy and security to protect customer and employee information. Comprehensive compliance frameworks help avert cyber incidents like data breaches, which put sensitive information at risk. They also avoid regulatory investigations or lawsuits.

Implementing rigorous controls across data collection, storage, use, and deletion enables compliance with expanding laws like the General Data Protection Regulation (GDPR), California Consumer Privacy Act (CCPA), Sarbanes-Oxley Act (SOX), and more. This mandates data governance through access controls, encryption, anomaly detection, and remediation.

Formal standards such as ISO 27001 and the National Institute of Standards and Technology (NIST) provide guidelines. Adhering to these while enabling measures like multi-factor authentication and backup facilitates compliance. Organizations must safeguard personally identifiable information, cardholder data, and other sensitive customer records from compromise.

Ongoing security awareness training alongside real-time monitoring, automated blocking of vulnerabilities, regular audits, and timely patching promotes compliance. It also reduces exposure to reputational damages, fines, and lost consumer trust from incidents.

How data compliance impacts businesses

Data compliance is more than just securing data; it shapes how businesses handle, transmit, and utilize information. It’s the critical junction where individual data privacy rights converge with ethical data use within enterprises. Key questions surface to comprehend data compliance obligations: How is data safeguarded against unauthorized access? And how is it utilized—purely for business purposes or directly benefiting customers?

Security stands as a cornerstone in compliance standards. Governments and standards like GDPR emphasize the importance of data privacy, necessitating robust cyber risk management. Compliance is not just a checkbox; it ensures individual rights across industries and upholds user privacy in critical healthcare, finance, and retail sectors.

Compliance governs proper business data use and mandates documented consent. It transcends a mere checklist—a strategic cornerstone molding operational efficiency, fostering customer trust, and ensuring compliance with rigorous regulatory norms.

Most common data compliance requirements

There are some governmental and industry data privacy rules and regulations organizations must comply with, including:

General Data Protection Regulation

The General Data Protection Regulation (GDPR) is a legal framework developed by the European Union (EU) that creates guidelines for how companies that do business with the EU member states can collect and process the personal information of people living in the EU. 

The GDPR, which went into effect on May 25, 2018, aims to regulate the processing of EU citizens’ data. The GDPR includes a range of rules regarding people’s right to know what sensitive data businesses collect on them and how companies should store and process this sensitive data. The GDPR also offers more stringent rules on how organizations should report data breaches. 

EU data protection authorities can fine organizations that don’t comply with the GDPR and don’t protect the personal information of EU citizens. The fines range from up to 10 million euros ($11.4 million) or two percent of its annual revenue, whichever is more significant.  

Health Insurance Portability and Accountability Act of 1996 (HIPAA)

Under HIPAA regulations, healthcare organizations and their business associates must take measures to safeguard patients’ electronic health records from cybersecurity threats. Companies handling individuals’ Protected Health Information (PHI) must comply with HIPAA regulations covering the security and privacy of sensitive data.

The HIPAA Privacy Rule established national standards to protect patients’ sensitive data or PHI. The HIPAA Security Rule established the national standards organizations must follow to secure patients’ sensitive data that they store or transfer electronically. The penalties for failing to protect patients’ sensitive data range from $10,000 per violation to $50,000 per violation based on a tiered structure. The annual maximum fine is $1.5 million.

Payment Card Industry Data Security Standard (PCI DSS)

Companies that deal with customers’ payment card information must comply with the PCI DSS. The PCI DSS defines the rules concerning how organizations handle, transmit, store, and secure customers’ credit, debit, and cash card-sensitive data. 

Cardholder personal data includes the account holder’s name, address, account number, and the card’s expiration date. An organization that suffers a data breach and exposes customers’ personal information because of non-compliance could be fined between $5,000 and $100,000 a month until it achieves PCI compliance requirements.

Common Challenges to Data Compliance

Achieving robust data privacy and security for customer data compliance remains challenging due to:

• Rapid Tech Shifts: Cloud adoption and Bring Your Own Device (BYOD) policies hinder information security control.
• Expanding Data Volumes: Ever-growing business data across multiple apps strains data management protocols.
• Complex Regulations: Multifaceted compliance requirements stemming from laws like GDPR, CCPA, HIPAA, and SOX.
• Resource Limitations: Budget, time, and talent constraints prevent the full implementation of privacy regulations and security measures.
• Fragmented Systems: Lack of visibility into fragmented infrastructure hinders security oversight, including credit card or California residents’ data.
• Proof Challenges: Credibly demonstrating SOC 2 or other standards compliance to auditors remains difficult.

With evolving technology storing more sensitive information, achieving continuous regulatory data compliance throughout the data lifecycle is increasingly complex. But well-planned frameworks, automated tools, and robust policy communication aid data privacy, security, and governance – the foundations for defensible compliance.

How to Ensure Data Compliance in an Organization

Strategically achieving continuous data privacy and security compliance necessitates:

1. Strong Governance: Documenting data management policies aligned with providers and privacy laws like CCPA for customer data storage.
2. Technical Controls: Encrypting data, automating patching, and implementing robust access controls per data protection regulations.
3. Training Programs: Instituting information security management system training and general employee education covering compliance program protocols.
4. Risk Management: Identifying and mitigating vulnerabilities through audits, especially for sensitive data like healthcare records or cardholder information.
5. Control Validation: Arranging independent audits to confirm controls meet standards like SOC 2, ISO 27001, or NIST.
6. Monitored Access: Allowing user access to real-time data without compromising security policies or enabling breaches.
7. Constant Improvement: Review processes and systems to address gaps quickly, upholding regulatory compliance.

With strong governance, appropriate security controls, and continuous training, organizations can achieve sustainable data compliance – bolstering customer trust and avoiding fines.

Let ZenGRC Be Your Data Compliance Solution

ZenGRC offers a comprehensive platform designed to simplify and optimize data compliance. With features tailored to address compliance challenges, streamline processes, and provide real-time insights, ZenGRC empowers organizations to navigate the complex regulatory landscape effectively.

By prioritizing compliance, organizations protect their reputation, build trust, and create a secure environment for data handling. Schedule a demo today!