What Are Privacy Acts? And Why Are They Important for Your Business?
Control over our privacy is something we should all be entitled to. Privacy is a human right after all and that should be the case whether we’re on or offline. Good news is many countries around the world have introduced privacy acts for both online and offline data use over the recent years.
With the internet growing astronomically in such a short period of time, more concern than ever has been placed on user data and how it's gathered, stored, and used by those who acquire it. That said, more freedom of use and less personal control of data have put users' information almost perpetually in danger of being breached and stolen.
Cybercrimes are also rising, with 465,177 reported incidents during 2020, as The Internet Crime Complaint Center's report found that year. That number doesn't include attempted attacks, by the way.
Data privacy laws can (and do) help protect user data, which is why more businesses must take the legislation seriously. In this guide, we'll look at what privacy acts are, the consequences of breaching them, and how they're a top priority for any business in 2022.
What Are Privacy Acts?
A privacy act or law is a body of law that deals with regulating the storage of data and how any one organization or person uses the stated information beyond simply asking for it and keeping it in a database.
This data is often personally identifiable information, such as financial data and personal healthcare details. These laws often apply heavily to the commercial sector, making individuals liable when they're responsible for handling this data.
However, not all countries have the exact same data laws or privacy acts in place. Currently, 137 out of the total 194 countries on the planet have legislation in place to protect users' privacy.
Despite many of us seeing privacy as a human right, protections have not been rolled out universally to their fullest extent as of yet.
There are plenty of resources on privacy acts, what they are, and how they could affect your business in particular. Take some time to utilize this guide on Osano's website as it offers further information on the CPRA and many other privacy acts.
The Importance of Privacy Acts for Your Business
How is privacy acts noteworthy to your business specifically? Privacy acts are something we are all protected by. Therefore we can all appreciate the need to comply with legislation and the laws in place when in the position of collecting and using other people's data.
However, despite many countries introducing strict laws, not everyone abides by them. Privacy laws are essential to a business for several reasons:
They're a necessity for many industries
From banking to medical institutions, some industries require privacy laws as a necessity. Many professions have privacy laws built into the job that employees and organizations are expected to maintain both online and offline.
Builds trust in customers and clients
Data protection can help improve the relationships between businesses and customers. Confidentiality, regardless of the level of sensitive information provided, should be kept private no matter what. Otherwise, it can effectively ruin a client relationship beyond repair in some cases.
The Consequences of Breaching Privacy Laws
As it's been mentioned, privacy laws can damage a business if the trust between a customer or client has been broken due to a lack of privacy. The broader consequences that come with breaching privacy laws can be significant.
A data breach is bad publicity, and once you have been breached, it's your duty and responsibility to share that news within a certain number of hours. If not, that could lead to further action being taken against you.
Either way, if you're seen to have done nothing to help prevent the breach, like non-compliance to the laws in place, then reputational damage is bound to occur. That, for some businesses, can take a long road to recover from.
Loss of sales
A loss of sales can impact any business, especially for smaller organizations that may only be starting out. You can have small business ideas or the best idea ever but with a breach of privacy, your average sales could drop or disappear altogether.
A loss of sales can be detrimental to some businesses, and it can take a long time to build up the sales revenue again. Respecting privacy laws and investing in strong cybersecurity is good for business.
Expensive to recover from
The cost of recovering from a data breach can be substantial. You may have to face legal action in some cases, which could cost you thousands in solicitor fees, and you could have to reimburse some customers for any losses they've experienced. On top of that, you'll have to spend the money to market your business again and rebuild positive publicity in an effort to recover your image.
Loss of new quality hires
One of the most unexpected issues that come with a breach or negative impact on your business' reputation is that you may end up losing quality hires as a result. Not everyone wants to be associated with a company that has gotten into this kind of trouble before. You may struggle to hire some of the best talent on the market because of your company’s refusal to follow the rules.
How To Be Compliant in Business When It Comes to Privacy
There are many ways to be compliant in business, especially regarding privacy. Here are a few ways to improve the security of your currently held data and how to remain compliant with all applicable privacy laws regarding business upkeep.
Understand the types of data you hold or acquire
When collecting data, you want to be well informed of what data you do have so that you're not misusing it or holding onto information that's no longer needed.
Make sure that both you and your peers know what type of data you're storing, what's personal or not, and where that data is coming from. It's crucial also to be aware of where the data is stored and how it is used.
Awareness of consent
Some data may not require consent, whereas other personal data may need a clear and succinct message from the user acknowledging their approval of using their data and understanding of how it's used. The more specific you can be in this, the better.
As a result, you'll have less chance that someone will kick off at you for misusing the data. If you prove that users consented and that your message is clear, you will more than likely be protected legally.
According to Pew Research Center, 79% of respondents said they were very or somewhat concerned with how companies use data they collect about them. It's imperative that businesses have an awareness of what data they're collecting and can explain why they are holding onto it.
You should also be aware of the right of access that customers have when it comes to their personal data. Be sure to understand everything surrounding this and how quickly you are required to follow up on a request for information or other queries.
Review your security measures
As a business, you must be aware of the security measures and policies you have in place. The use of encryption is key so that you can reduce the risk of a security breach occurring. Hiring an expert in security or IT would be prudent to better understand the potential vulnerabilities within your business’ security and how to reduce any other cybersecurity risks.
Train your employees
One of the biggest threats to business security is your employees. Human error can often cause a lot of security breaches, and it's something that can be prevented for the most part. Staff training can be helpful when a violation has occurred, and it's useful for employees to know how to quickly report a breach and to whom the report needs to go.
Regularly review policies and audit your supply chain
Reviewing company security policies you have in place for your business’ data will help ensure you're doing everything possible to protect your customer's data. Not only that, but it's worthwhile to audit your supply chain, which is everyone outside of your business that you work with, once in a while.
Sometimes, the businesses you work with won't have the same due diligence when it comes to following privacy acts to the letter. You may want to take your business elsewhere in such cases.
Understand the Privacy Acts Your Business Needs To Obey in 2022
Being a global business or one that operates across many territories can further complicate the rules you must abide by. But you must remember, as a business, you're not exempt from any privacy acts put in place for your customer's protection.
With business comes great responsibility. Be prepared and be thorough. Make sure you have all the necessary training, policy, and security measures in place to become privacy compliant and prevent the next unfortunate data mishap.