Data compliance regulations compel companies to improve their data security standards and practices, to prevent breaches from occurring and their customers’ sensitive data from being exposed, stolen, or corrupted.
What Is Data Compliance?
The Importance Of Being Data Compliant
Key Data Compliance Regulations You Should Know
Data compliance is a process that identifies the applicable governance for data protection, security, storage and other activities and establishes policies, procedures and protocols ensuring data are fully protected from unauthorised access and use, malware and other cybersecurity threats.
By complying with regulations, organisations ensure their sensitive data won’t be compromised, and confirm the necessary precautions have been taken to keep their customer’s data safe. One of the biggest and most significant consequences of not being compliant and obeying legislation is the impact it has on customer trust and loyalty.
According to a Varonis analysis of companies’ reputations after a data breach, 80% of consumers will defect from a business that has compromised their data, and 52% of consumers would pay the same for products or services from a different brand with better security.
When an organisation takes the proper steps to be data compliant, they not only better protect their data but also appear more trustworthy and credible to their customers. Their customers can rest easy, knowing that their data is being protected, and won’t fall into the wrong hands.
Public and private sector organisations have a fiduciary responsibility to protect the information they use to manage their businesses. The availability of relevant standards, regulations and other governance rules and practices that deal with the security, privacy and protection of data ensures that data can be securely managed and protected.
Compliance with data standards, regulations, and other governance rules and practices help ensure that the confidentiality, integrity and availability of an organisation's data, databases and other relevant information are protected. Unauthorised access to mission-critical data could result in damage to the organisation's reputation, loss of revenue and loss of business. However, compliance can be achieved with the help of dozens of available resources, like security technologies, antivirus software and anti-ransomware software to protect all forms of data.
Data privacy is far more than just the security and protection of personal data. It all boils down to how organisations are using that personal data. Organisations need to process personal data in an ethical and legal manner. That could mean not bombarding customers with unwanted SMS marketing messages but it could also mean simply not sharing personal information with third parties without the customer’s consent.
It doesn’t mean that marketing is now forbidden under data privacy laws but it does mean that organisations need to be transparent about what personal data they are capturing and how it’s going to be used. Many organisations recognise the significant risks of cyber-attacks and data breaches but fail to understand what else is required to safeguard what is referred to as the “rights and freedoms of individuals”.
The GDPR protects the personally identifiable information of customers and employees. That is a broad category that can include anything that might identify a person, like:
Punishment for non-compliance with the GDPR is a tiered system of fines. Severe or flagrant violations can lead to fines of up to 4% of the company’s global annual turnover or 20 million Euros — and you’ll have to pay the greater amount.
This Act gives effect to the Constitutional right of access to any information held by the State and any information that is held by another person and that is required for the exercise or protection of any rights (as per Section 32 of the Constitution of the Republic of South Africa 1996). In addition the Act provides that the Information Regulator (established in terms of the Protection of Personal Information Act, 2013) must exercise certain powers and perform certain duties and functions in terms of this Act. The overall purpose is to:
The POPI Act is an all-inclusive piece of legislation that safeguards the integrity and sensitivity of private information. The Act recognises the:
Companies are required to carefully manage the data capture and storage process of Personal Information within the lawful framework as set out in the Act.
One of the key aspects of any privacy law, and POPIA in particular, is that it describes the conditions for lawful processing. In other words, the conditions that need to be met if you are to manage personal information correctly. Meeting these conditions are mandatory if the organisation is seeking compliance with POPIA.
These conditions are:
Sections 100 – 106 of the POPI Act deal with instances where parties would find themselves “guilty of an offence”. The most relevant of these are:
Section 107 of the Act details which penalties apply to respective offences.
For the more serious offences, the maximum penalties are a R10 million fine or imprisonment for a period not exceeding 10 years or to both a fine and such imprisonment.
For the less serious offences, for example, hindering an official in the execution of a search and seizure warrant, the maximum penalty would be a fine or imprisonment for a period not exceeding 12 months, or both a fine and such imprisonment.
Besides fines and penalties, non-compliance with POPIA can have other serious consequences for organisations, their employees and customers, including reputational risk, loss of revenue due to negative press, loss of customer trust, disciplinary actions and dismissals of employees. Accountants and Auditors also need to consider the effects of POPIA, including:
If your organisation is GDPR compliant, you are likely to be POPIA compliant as well - but you need the formal documentation (policies and procedures) as required by POPIA to demonstrate compliance.
Data privacy is also becoming a priority in international markets. China and the United Arab Emirates all passed privacy legislation in 2021, and it’s likely that other countries will follow suit. The U.S. and EU have agreed to a preliminary deal that spells out how American companies can store the personal data of Europeans.
Worldwide, governments are trending toward stiffer compliance standards for consumer data privacy protection. If your product or operations have weak points that might expose sensitive data, now is the time to shore those up.
It is wise to seek legal advice when dealing with such a variety of laws and regulations.