4 Key Reasons You Should Care Deeply About Data Privacy for Your Business

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Data privacy is a hot topic that’s not going anywhere anytime soon. Consumers are savvier than ever and expect businesses to handle their personal data with care.  In fact, a study for AU10TIX by Wakefield Research found that 81% of consumers believe they have very little or no control over their personal data once it’s shared with companies. On top of that, 51% of consumers worry their personal information may wind up in the hands of the wrong person. 

To be successful in today’s digital world, business owners and leaders must carefully consider how they will collect, use, and safeguard the personal data of their customers and employees. Consumers expect companies to consider their privacy when designing products and services. They also want organizations to be transparent about how customer data is being used so they can make educated decisions about their digital lives. 

In this post, you will learn the following: 

  • ⁕ The difference between data privacy and data security 
  • ⁕ The consumer protections in place for those in North Carolina 
  • ⁕ The regulations for N.C. businesses under the Consumer Protection Act 
  • ⁕ How data privacy impacts businesses large and small 
  • ⁕ Best practices for ramping up data privacy for your customers and employees 
  • ⁕ How CloudWyze can help your business secure your data 

Let’s get started by diving into the difference between data privacy and data security. 

Data privacy is not the same thing as data security. 

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It’s easy to mix up data security and data privacy; they both connote a sense of protection around sensitive information. However, it is important to understand that each serves its own important purpose and offers a sort-of one-two punch in protecting data from prying eyes. 

Data Privacy – Data or information privacy centers around how an organization collects personal data, what it does with the personal information collected, and how a consumer can control their own personal data.  

Data Security – Data security focuses on protecting information from loss or theft, as well as unauthorized access or use. 

Your business can have strong security without providing a high level of privacy protection for its customers’ private information. But if you want to truly protect your customer’s data, then you need both strong security AND strong policies around privacy protection. 

The Status of the Consumer Protection Act (CPA) in North Carolina 

North Carolina Consumer Protection Act NCCPA Data privacy for businesses

 

Unlike the EU’s General Data Protection Regulation (GDPR), data privacy laws are currently left up to the states in the U.S. California, Colorado and Virginia are among the states that have recently passed consumer information protections. But what about North Carolina? 

The North Carolina Consumer Privacy Act was introduced in 2021 by Senator Joyce Waddell and has remained in committee since that year. If passed, the NC CAP will regulate how businesses handle, process, and use the personal data of their customers. Here are some of the main regulations businesses can expect: 

Customer Request Response

Businesses must comply with CPA requests within 45 days. 

Data Collection Disclosure

Businesses must disclose the reasons it’s collecting consumer personal data. 

Data Collection Limitations

The collection of personal data by businesses must be limited to only what is “adequate, relevant and reasonably necessary” in relation to the disclosed reasons for personal data collection and may not exceed that without consent from the consumer. 

Obtain Consent for Sensitive Data

Businesses may not process sensitive data concerning the consumer without obtaining consent. 

Privacy Notice

Businesses must provide consumers with a reasonably accessible, clear, and meaningful privacy notice that includes the following: 

  • ⁕ the categories of personal data being processed 
  • ⁕ the purposes of such processing 
  • ⁕ how consumers may exercise their rights under CPA  
  • ⁕ the categories of personal data that the business shares with third parties 
  • ⁕ the categories of third parties with which the business shares data 

Data Processor Contracts

Businesses must enter contracts with their data processors. The contract must include the procedures performed by the processor on behalf of the business and include specific requirements. 

Conduct Data Protection Assessments

At least once per calendar year, businesses must conduct and document data protection assessments. 

Now that you know some of the main regulations, let’s look at how being out of compliance with CPA can impact your business. 

Why your business should prioritize data privacy. 

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Doing business in the modern world means dealing with a lot of sensitive information, both from your employees and your customers. Having a plan to protect sensitive data is no longer optional – it’s critical. In North Carolina, businesses will face some serious impacts for being out of compliance with the state’s CPA. Here are some of the ramifications you can expect. 

#1. Regulatory fines  

Under Section 75-77 of the pending NC CPA, companies can be fined up to $5,000 for each violation. In addition, the state’s Attorney General can ask the organization to recoup the cost of the investigation and trial costs, including attorneys’ fees.  

Also, companies may face lawsuits from customers who claim they were harmed because of the misuse of personal information. All these fees add up quickly, especially if there are numerous violations or multiple customers who are affected. 

#2. Loss of customer trust 

In business, there are few things more important to a company’s success than its brand reputation. Customer trust is one of the biggest metrics indicating a business is on the path to success. If that trust is broken through a data breach, it can cause irreparable harm to an organization.  

According to a study by PwC, 88% of customers say their willingness to share their personal data is directly determined by their trust of a company. In addition, 87% said they will go elsewhere if they are given a reason not to trust a business.  

Want an easy way to impress your customers? Make it a priority to protect their data beyond what is mandated.  

Be loud, transparent, and ultra-clear about the safety controls you have in place. Communicate your safety measures often and use your security as a marketing tool! Not all businesses prioritize their customers’ data, so you’ll be seen as a forward-thinking industry thought leader. 

#3. Investor wariness 

Customer trust is one component of a successful business, but investor appeal should be considered too. A solid data privacy strategy can ultimately help your business attract more business. Investors will be more willing to buy into your company if they know that it has a good reputation.  

As you know, one way to maintain a pristine reputation is to ensure you have strong data privacy policies in place. Investors will lose interest if they perceive your business as a declining asset, however, a business with a stellar reputation is seen as an excellent investment opportunity.  

#4. Data breaches  

When you think of data security, you probably think about hackers and network intruders. But many breaches are not due to outside attacks—they’re due to internal negligence or error. This can be anything from a lost laptop to an employee clicking on an errant link. 

The cost of these breaches is enormous. According to a report by IMB and The Ponemon Institute, the estimated average cost per data breach in 2022 was $4.35 million, up a whopping 2% since 2021. Those numbers include both financial costs like lost business, forensic investigations and notification fees, and reputational costs like damage to your brand or loss of customer trust. 

How to ramp up data privacy for your business.

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Now that you understand the absolute importance of data privacy, how can you ramp up data privacy for your business? Here are some quick tips for keeping private data, well, private. 

Data Minimalist Approach 

Store the minimal amount of information needed. The more data you have, the more valuable it is to hackers. 

Frequent Internal Security Training 

Train employees in securing data and make sure they understand why it’s so important to protect customer information as well as their own personal information. 

Password Protection and Encryption 

Protect all devices with strong passwords and turn on time-out functions when not in use. Also, encrypt files whether they are in use or not by authorized personnel—this way hackers won’t be able to steal them if they break into your system or the cloud server. 

Banish Portable Media Usage 

Avoid using USB drives or CDs/DVDs (or other portable media) to transfer large amounts of personal information outside the office. Such devices are easy targets for identity theft criminals who want access to sensitive financial information about customers or employees. Ultimately, using these devices could lead hackers into your network system. 

CloudWyze Helps Protect Businesses Large and Small 

Technology, especially business technology used by employees, can be quite complex. CloudWyze helps protect North Carolina businesses of all sizes through its high-touch IT management and Security services.  

We have vast experience working in heavily regulated industries such as medical, financial, scientific and regulated manufacturing. Our tech experts provide network monitoring, web, email and server filtering, as well as remote server protection to ensure that your most important data is always kept safe from prying eyes. 

CloudWyze also owns and operates its own fiber network, giving us direct access to subject matter experts unlike many IT managed service providers. Plus, CloudWyze offers hyper-secure cloud services to help you protect your most valuable information. 

Make Data Privacy a Priority for Your Business 

Data privacy is a business issue, not just a personal one. Businesses that don’t take steps to protect their data may be exposing themselves to serious financial and legal risks in the future. As we’ve seen with recent data breaches, it can take years for companies to fully recover from such incidents—and even longer for consumers to trust them again. 

So, what does this mean for your company? It means it’s time to get serious about protecting your customers’ data and start developing a proactive strategy to protect their sensitive information. Businesses can no longer afford to brush the issue aside. In today’s world, data privacy is no longer a consideration—it’s a must for the success of your business. At CloudWyze, your business and its safety are our highest priority.  

Find out how CloudWyze can secure your business data. Call us today at (910) 795-1000 or click here to get started.