Risk Management has long been the most important tool to achieve regulatory compliance with the law of the land in matters related to information security. With cyber risk events becoming a moving menace for an unprecedentedly large number of organizations globally, the rule of the land is transcending the territorial scope to encompass factors that have so far stayed outside.
So, an unprecedented threat landscape is hurrying changes in information privacy laws in the European Union, where data reforms have long been overdue.
Penalty to dwarf previous punishments
The General Data Protection Regulation (GDPR) in the EU is set to comprehensively overhaul how businesses store, access and process consumers’ sensitive digital data and simultaneously protect their rights to privacy and data protection. And in the face of the imminent regulation, there are far too many reasons to worry, both for European enterprises and non-European businesses operating within the EU. While the regulation enormously increases the responsibility of enterprises, it has also set perilously high penalty for non-compliance.
The latest report from Ponemon documented that the average cost of data breach to a company – $3.5 million – was 15% more than the previous year. The GDPR levying €100 million or five percent of worldwide turnover is set to dwarf previous punishments and could push a business to the brink of closure.
Conscious consumers enforcing changes
The forthcoming regulation – which aims at harmonizing EU and non-EU businesses’ digital information security practices, or rather the lack of it – has more to do with bridging the gap between commitment and execution in risk management. In a scenario where the threat landscape is evolving and data breaches continue to occur with cruel regularity, the lack of well-intentioned endeavors to enhance their security posture is failing organizations.
On the other hand, regulations such as the GPDR reinforces the awareness of the already conscious consumers, who keep track of the way their data is managed, thereby putting pressure on enterprises to bolster their security infrastructure. Companies spend heavily to repair brand image in the aftermath of a data breach, but show no proactiveness to take advantage of the role risk management plays in building preventive measures.
Test for companies
The impending regulation will put into test organizations’ intention and capacity to protect the fundamental rights and interests of consumers as well as the resilience to withstand a potential breach attempt as companies will be “dealing with an average of 17 malicious codes each month and 12 sustained probes each month.” While prevention will be the key, threats can rarely be eliminated in their entirety. Wholesale risk elimination on the other hand will strip firms off their flexibility, stifling innovation and business continuity.
Necessity of an enterprise-wide risk culture
GDPR compliance will necessitate explicit processes and procedures, data encryption and building a business-wide a culture of privacy and protection, among other things. An efficient data protection risk management strategy will ensure that the balance between caution against over-protection and actions to take advantage of risk exposure is achieved. It will also facilitate an adequate assessment of existing data security practices while ascertaining that newly adopted strategies are seamlessly integrated with the existing framework.
Smart businesses would utilize the intervening time
Successful businesses should embrace the benefits of using risk management to answer data privacy concerns by effectively implementing the practices that make risk management the most successful tool for privacy protection. Smart organizations sustain business continuity in the risk-intensive world by systematically identifying impending threats followed by prioritizing risks and developing appropriate mitigation measures.
With the increased complexity, added responsibilities and higher accountability, wise organizations would prefer joining hands with a true technology partner. Assistance from a highly evolved tool that incorporates the latest standards of ISO/IEC 27001:2013 would go a long way in ensuring your business stays compliant. Harmonizing with other related standards such as the PCI DSS 3.0, it will allow you the opportunity to focus on business continuity management. Although differences within EU authorities will likely push GDPR implementation beyond 2015, enterprises with smart vision would utilize the intervening time wisely to avoid complaining after the regulation becomes a reality.
Risk Management Studio is a risk management toolkit combining information security and technology risk management with business continuity planning for one easy to use solution. RM Studio is a turnkey deployment design that will immediately streamline the operational risk management for the implementation and maintenance of an effective and efficient ISMS, as well as meet the compliance requirements outlined in management standards such as ISO 27001:2013 and PCI DSS 3.0.