What is data privacy compliance and how can your business achieve it?

Data can be the lifeblood of a business – but without an ironclad approach to consumer privacy, data can end up costing your company everything. With regulators no longer sitting on their laurels, the time to nail compliance is now. There are reasons beyond fines and data breaches to revisit your data privacy practices. Namely, your consumers are paying more attention than ever before. 

Let's explore the key aspects of data privacy compliance, why it matters, and how your business can successfully comply with major data privacy regulations such as the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA).

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What is data privacy compliance?

Data privacy compliance means following laws that govern how personal data is collected, stored, and used. It ensures businesses handle personal information responsibly, protecting consumer rights and maintaining transparency. Key regulations include the GDPR, CCPA, and other regional frameworks. Compliance helps avoid legal penalties, build trust, and strengthen data security through policies, consent management, and best practices.

Read more: What is data privacy?

Why is data privacy compliance important?

Data privacy compliance is crucial because it helps organizations avoid hefty fines, build consumer trust, and strengthen data security. Adhering to privacy laws ensures transparency, safeguards sensitive information, and supports long-term business success by reducing data breach risks and maintaining a positive brand reputation.

74% of consumers say they "highly value" data privacy, and 82% of consumers are highly concerned about how their data is collected and used. If you do not take the correct measures and data is compromised, you may not recover. Once you break consumer trust, it can be tough to get it back, not to mention the financial repercussions. 

- The Person Behind the Data Study

Why data privacy compliance matters

For businesses, data privacy compliance is not just about avoiding fines—it’s about long-term success and sustainability. Here’s why it matters:

1. Avoid legal and financial penalties‍

Regulatory fines for data breaches or non-compliance can be devastating, reaching millions of dollars. Additionally, legal disputes can disrupt operations and damage your financial stability.‍

2. Build consumer trust and loyalty

Today’s consumers are privacy-conscious and prefer brands that are transparent about data practices. Demonstrating strong privacy measures builds customer loyalty, driving repeat business and positive brand sentiment.

Your customers are speaking loud and clear. They are saying that they care about how their data is handled—and that they’re ready to reward companies that share their values and protect their privacy. It’s time to treat privacy as a key strategic priority—and find new ways to deliver the engaged, transparent, and robust data stewardship that consumers now crave.

- Data privacy truly matters to your customers. It’s time to make it a core business value, VentureBeat

‍3. Gain a competitive edge

Compliance can be a market differentiator, showcasing your company as trustworthy and forward-thinking. Businesses with strong data privacy frameworks can enter global markets more easily by meeting international standards.

4. Mitigate data breach risks

Complying with data privacy laws requires companies to adopt security best practices such as encryption, access controls, and regular audits. A proactive approach reduces the likelihood of costly data breaches.

5. Future-proof against evolving regulations

Data privacy laws are expanding globally. Staying compliant now means adapting more easily to future regulatory changes.

Key data privacy laws

Personal data protection is becoming a priority across the world. Over 120 countries have adopted some form of legislation to ensure the right to data protection and privacy is respected. However, data privacy laws differ widely based on location, with some countries – and even states – enforcing stricter policies and regulations than others. 

Complying with data privacy laws may seem complex due to the various global and regional regulations, each with unique requirements. However, many of these laws share common principles such as obtaining user consent, ensuring transparency, protecting data security, and granting individuals control over their personal information. Understanding these shared foundations can streamline compliance efforts, even when facing multiple regulatory frameworks.

The CCPA and the GDPR are among the most commonly discussed. GDPR is often considered the global standard because it includes some of the world's toughest privacy and security laws but it wasn’t the first. 

• The initial US Privacy Act was established in 1974, well before the internet as we understand it today could even be imagined.
• Laws such as the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Children's Online Privacy Protection Act (COPPA) came before the General Data Protection Regulation (GDPR). However, GDPR was the first law of its kind in that it applied data protection and privacy across the European Union (EU).
• Since then, several privacy laws have been enacted, like the California Consumer Privacy Act (CCPA) and Colorado Privacy Act (CPA). 
• The GDPR remains the most comprehensive piece of privacy legislation. However, changes are constantly happening, and it's up to you to stay aware of those changes. 

According to the United Nations (UN), 71% of countries have data privacy regulations to protect citizens, while 9% have draft laws.

Depending on where you conduct business and with whom will dictate what regulations you must follow. Knowing which laws and regulations apply to your business will help you implement optimal data protection and privacy strategies.

GDPR compliance

The GDPR is a global benchmark for data privacy, applying to organizations that process personal data of EU residents, regardless of location. Key requirements include obtaining explicit user consent, enabling data access and deletion, and appointing a Data Protection Officer (DPO) when needed. Non-compliance can lead to hefty fines of up to 4% of global revenue.

GDPR compliance applies to businesses that collect personal data from EU citizens. However, that does not mean the law is solely enforced within Europe. No matter where in the world you’re headquartered, this law applies if you collect data from EU citizens. 

he GDPR only applies to personal data. This data refers to any information that relates to an "identified or identifiable natural person." For example, telephone numbers, email addresses, or IP addresses. 

Businesses must follow GDPR principles and be aware of all GDPR compliance requirements, including the following:

• Companies must ask for consent or permission when using or storing your EU customers' data.
• Companies must have a lawful reason for processing personal data and ensuring transparency. 
• Companies can only collect data for a specific purpose and must document that purpose. When information is no longer needed, it should be deleted. 
• Companies must be aware of all data subject rights, such as the right to be informed and the right of access. 
• Companies must integrate safeguards to comply, prioritizing privacy concerns within all data processing practices.
• Companies must conduct data protection impact assessments (DPIAs) to identify and minimize privacy risks. 
• Staff awareness training is mandatory for those involved in the process of handling data. 

GDPR is strict and complex. If you are non-compliant, claiming ignorance won’t save you. Educating yourself is step one, as understanding the top GDPR compliance mistakes could help your company dodge a bullet. 

Related: How do you know if you are GDPR compliant?

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CCPA compliance

The CCPA is one of the most comprehensive data privacy laws in the U.S., granting California residents the right to know what personal data businesses collect about them and how it’s used. It requires businesses to provide clear privacy notices, enable data deletion requests, and allow users to opt out of the sale of their data.

Businesses must also honor “Do Not Sell My Personal Information” requests and maintain data security to avoid breaches. Non-compliance can result in significant penalties, including fines and legal actions.

In 2023, the California Privacy Rights Act (CPRA) expanded the CCPA by adding more protections, including data minimization, stricter opt-in rules for sensitive data, and increased enforcement powers.

The California Consumer Privacy Act (CCPA) and the California Privacy Rights Act (CPRA) require businesses to:

• Inform consumers: Disclose data collection practices, including the types of personal information collected and its intended use.
• Facilitate consumer rights:
  • Access: Allow consumers to view their personal data.
  • Deletion: Enable consumers to request the deletion of their data.
  • Opt-out: Provide options to opt out of data sales or sharing.
  • Correction (CPRA addition): Permit consumers to correct inaccurate personal information.
  • Limit use of sensitive information (CPRA addition): Allow consumers to restrict the use of sensitive personal data.
• Implement data security measures: Ensure reasonable security procedures to protect personal information.
• Update privacy policies: Maintain current privacy policies reflecting data practices and consumer rights.
• Establish contracts with third parties: Ensure service providers adhere to data protection obligations.
• Conduct regular audits (CPRA addition): Perform audits to assess compliance with data privacy laws.

Non-compliance can result in fines up to $2,500 per violation or $7,500 per intentional violation, including those involving minors under 16.

Read more: GDPR vs. CCPA/CPRA compliance: what's the difference?

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Other data privacy compliance frameworks

When aiming to develop a privacy program, the process can be daunting. You need to know your organization's requirements concerning applicable laws and regulations. To assist this process, data privacy compliance frameworks exist. These privacy frameworks, including the NIST Privacy Framework or the Fair Information Practice Principles (FIPPs), are based on specific standards or principles.

However, you can also use regulations like CPRA and GDPR as frameworks or leverage frameworks from platforms like Ketch. The latter allows for a customized approach, which can be invaluable. Ketch offers a simple framework for defining the acceptable use of any data type, eliminating the complexities surrounding navigating privacy laws and governance mandates. This option is ideal for any business unsure how to proceed and those wanting to save time and money concerning their current data privacy and protection operations.

Your chosen framework should be based on what makes the most sense for your business. For example, what are your regulatory requirements?

• Health Insurance Portability and Accountability Act (HIPAA)? 
• California Consumer Privacy Act (CCPA)? 
• GDPR? 
• All of the above? 

How to achieve data privacy compliance

Achieving data privacy compliance is essential for protecting personal information and maintaining trust with stakeholders.

1. Conduct a data audit

‍Identify personal data collected, processed, and stored.‍

• ‍Inventory data assets: Begin by cataloging all personal data your organization collects, processes, and stores. This includes information from customers, employees, and third parties. Understanding the scope of your data holdings is crucial for effective management and compliance.‍
• Assess data flows: Map out how data enters, moves through, and exits your systems. This visualization helps identify potential vulnerabilities and ensures that data processing activities align with privacy regulations.‍
• Evaluate data necessity: Critically assess whether the personal data collected is necessary for your business operations. Eliminating redundant or obsolete data reduces risk and enhances compliance

2. Create a privacy policy

‍Clearly outline how user data is handled.‍

• ‍Define data practices: Clearly articulate how personal data is collected, used, shared, and protected within your organization. This transparency is vital for building trust with individuals whose data you handle.‍
• Ensure accessibility: Present the privacy policy in clear, concise language, making it easily understandable for all stakeholders. Avoid legal jargon that could confuse readers.‍
• Regular updates: Review and update the policy periodically to reflect changes in data practices, legal requirements, or organizational structure. Staying current helps maintain compliance and trust.

3. Obtain informed consent

‍Use transparent consent mechanisms for data collection.

• ‍Implement clear consent mechanisms: Use explicit methods, such as opt-in checkboxes or consent forms, to gather permission for data collection and processing. Ensure that consent is obtained before any data processing activities commence.‍
• Provide purpose specifications: Inform individuals about the specific purposes for which their data will be used at the point of collection. This transparency allows individuals to make informed decisions about their personal information.‍
• Maintain consent records: Document and securely store evidence of consent to demonstrate compliance and manage preferences effectively. This record-keeping is essential for accountability and legal compliance

4. Enable data subject rights

‍Allow users to access, modify, and delete their data.‍

• ‍Access requests: Establish procedures that allow individuals to request and obtain a copy of their personal data held by your organization. Responding promptly to such requests is often a legal requirement
• ‍Data rectification: Provide mechanisms for individuals to correct inaccuracies in their personal data. Ensuring data accuracy is a key principle of data protection regulations.‍
• Data deletion: Offer processes for individuals to request the deletion of their data, ensuring compliance with legal obligations and retention policies. This right, often referred to as the "right to be forgotten," empowers individuals to control their personal information.‍
• Data portability: Facilitate the transfer of personal data to other service providers upon request, in a structured and commonly used format. This enables individuals to move their data seamlessly between services.

5. Ensure data security

‍Use encryption, firewalls, and access controls.

• ‍Implement technical safeguards: Utilize encryption, firewalls, and intrusion detection systems to protect data against unauthorized access and breaches. Robust technical measures are fundamental to data security.‍
• Establish access controls: Define and enforce policies that ensure only authorized personnel can access sensitive data. Limiting access reduces the risk of internal data breaches.‍
• Conduct regular security assessments: Perform vulnerability assessments and penetration testing to identify and remediate security weaknesses. Regular evaluations help maintain a strong security posture.

6. Train your team

‍Educate employees on data privacy best practices.

• ‍Develop training programs: Create comprehensive training sessions to educate employees about data privacy principles, organizational policies, and their specific responsibilities. Well-informed staff are crucial to maintaining compliance.‍
• Promote a privacy-centric culture: Encourage a culture where employees understand the importance of protecting personal data and are proactive in following best practices. A privacy-aware workforce is a significant asset.‍
• Stay informed on regulatory changes: Keep the team updated on evolving data protection laws and adjust training materials accordingly. Continuous education ensures ongoing compliance in a dynamic regulatory environment.

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Exploring data privacy compliance software

Selecting the right data privacy solution is crucial for managing consent, automating data subject requests, and maintaining compliance with evolving regulations.

What is data privacy compliance software?

Data privacy compliance software helps businesses manage and protect personal data according to legal regulations like GDPR and CCPA. It automates tasks like consent management, data subject requests, and policy enforcement, ensuring companies handle sensitive data transparently and securely while minimizing compliance risks.

Key features to consider include:

• Consent management: Efficiently collect and manage user consents across various platforms to comply with laws like GDPR and CCPA.
• Data mapping: Gain a comprehensive understanding of data flows within your organization to identify and mitigate potential privacy risks.
• Automated compliance: Utilize tools that automatically adapt to new regulations, ensuring continuous compliance without extensive manual intervention.

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Ketch data permissioning platform offers a suite of features designed to simplify data privacy management:

• Ketch's consent management platform (CMP) enables businesses to collect, manage, and store user consent for data processing, ensuring compliance with privacy laws like GDPR and CCPA.
• Ketch provides automated data mapping capabilities, offering a clear view of data assets and flows, which is essential for risk assessments and compliance audits.
• With pre-built templates for major privacy regulations, Ketch allows organizations to deploy responsive privacy banners and experiences without coding, facilitating quick adaptation to regulatory changes.

By integrating Ketch into your data privacy strategy, your organization can effectively manage compliance requirements, build customer trust, and focus on growth initiatives with confidence.

Successful examples of data privacy compliance

Spreedly

Spreedly, a global payments provider, sought to enhance its data privacy compliance by replacing an outdated legacy system. They partnered with Ketch to achieve this goal. Ketch's comprehensive data privacy platform enabled Spreedly to automate consent management, data subject request handling, and data mapping.

This automation streamlined Spreedly's compliance processes, allowing them to meet regulatory requirements efficiently. Notably, Spreedly achieved full data privacy compliance within just three weeks of implementing Ketch's solution.

"We are absolutely delighted with our Ketch experience to date. Their responsiveness to our implementation has taken us from project start to go-live in just three weeks. Few vendors can match this time-to-value."

- Jennifer Rosario, Chief Information Security Officer, Spreedly

Prestige Consumer Healthcare

Prestige Consumer Healthcare (PCH), a leading provider of over-the-counter health and personal care products, partnered with Ketch to enhance their data privacy compliance. PCH sought to balance data-driven growth with the protection of consumer data, aiming to uphold their core value of trust.

Ketch's platform enabled PCH to automate consent management and data subject request handling, ensuring real-time compliance with global privacy regulations. This integration allowed PCH to honor consumer consent across various channels and devices, seamlessly enforcing privacy choices throughout their internal and external systems. By leveraging Ketch's orchestration capabilities, PCH maintained robust data privacy standards while continuing to scale their brands globally.

"We're excited to partner with leading, innovative companies like PCH, who embrace people's data privacy, while maintaining the opportunity for data-driven growth—building value while honoring values,”

- Jonathan Joseph, Head of Solutions, Ketch

Achieve data privacy compliance today

In conlusion, to create a data privacy policy covering all the bases, you need to be aware of each regulation related to your company. You can then create a privacy compliance checklist based on each regulation, leveraging resources such as this GDPR checklist or this CCPA compliance checklist.

Alternatively, you can invest in a platform that does all the heavy lifting for you. With a few simple steps, you could future-proof your privacy compliance program. As data security regulations expand and customer expectations change, this option has become the solution for data privacy and compliance concerns. 

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