Does My Company Need to Have a Privacy and Data Protection Program?

Privacy and Data Protection Program

The short answer is “Yes.”

To begin with, such programs are needed to comply with legal and compliance requirements. Privacy is regulated by a growing number of jurisdictions around the world. Some of these regulations, such as proposed Canadian Consumer Privacy Protection Act, specifically require companies to implement a privacy management program. Others, such as the HIPAA Security Rule and New York SHIELD Act, require covered organizations to maintain appropriate administrative, technical, and physical safeguards to protect certain personal information.

Second, a privacy program implies an integrated and structured approach to the management of organizational information, including collection, storage, processing, access, use and deletion of data. This will also help companies comply with a complex and ever-growing web of regulatory requirements regarding collection, processing, and security of personal information.

Third, contracts related to disclosure and processing of personal information often require parties to comply with certain requirements for the protection of such data. Organizations risk losing valuable business relationships by not developing data management policies and procedures and failing to comply with their contractual requirements on these issues.

Fourth, developing a robust data management and protection program will help organizations minimize the risk of data breaches that cause damage to businesses and consumers. The average total cost of a data breach in the world is $3.86 million, although the costs are much higher for organizations that lag behind in areas such as incident response processes and security automation. Implementing a data protection and security program will reduce the risk and number of data breaches, meaning that a business will incur fewer costs, reduce the risk of fines and lawsuits, and protect its customers’ trust and market position.

Fifth, developing a data protection program will help an organization to maintain trust with public, investors, and customers. A great number of organizations have suffered damage to their reputation as a result of privacy mishaps and data breaches. Organizations that make it clear that data protection is their primary goal and support this goal through transparent and consistent practices earn the trust of public, investors, and customers.

Finally, consumers are becoming more aware of their rights to protect their data and the right to access and control their personal information. Organizations that implement data and privacy protections will strengthen and grow their businesses as consumers will prefer them over competitors that do not provide such controls.

The proliferation of privacy and data protection regulations around the world, data security risks, as well as consumers’ emerging awareness of their rights and growing expectation that companies take steps to protect their privacy and personal information, require organizations to take a structured approach toward their privacy and data management practices. Developing a proactive privacy and data management program is essential not only for compliance and data risk management but also to maintain consumers’ trust and confidence, and to sustain and grow the organization’s position in a competitive marketplace.