A comprehensive guide to data privacy laws & their importance

With the increasing volumes of data, companies are also gathering data on their users to gain actionable insights, improve decision-making, and boost business performance. In fact, it has been observed that more than 90% of the data that are in use today was created in the last two years. With this collected data, businesses can unlock newer opportunities. As a result, potential customers are receiving more personalized results in their searches, which leads to decent results for both businesses and customers. However, with all the benefits and importance of data, a question that often comes to the spotlight is: What about the privacy of personal data?

Data privacy is of utmost importance in today's highly digitalised world for both consumers and organisations. It is a way to ensure that data is not stored without overlooking the laws associated with it. As a matter of fact, the very reason behind creating data privacy laws is to protect everyone's data, as individuals, as employees, and as customers. Moreover, the emergence of sophisticated and advanced cyberattacks also highlights the importance and the necessity of such regulations.

Data privacy: A quick glance

In general terms, the handling of critical and sensitive personal information, which is also known as Personally Identifiable Information and Personal Health Information, refers to the definition of data privacy. This sensitive information can be anything, such as your financial information, your health data, your social security numbers, and so on.

Remember that the definition of data privacy and protection is completely different in the context of business, which goes beyond employees' or customers' personal data. The data in the business context includes your organisational information, business strategies, confidential agreements, and much more. It relates to all the information or data that helps organisations operate seamlessly.

What is the importance of data privacy and protection?

Of all the key reasons that support the value and importance of protecting your data, here are the top factors that highlight the importance of data privacy laws:

Data protection

Businesses deal with vast amounts of information, which includes the personal information of clients and customers. Protecting that information becomes a priority, and this is where data privacy comes into the picture. It allows you to safeguard the information from unauthorised access, ensuring that critical and confidential information remains safe and protected. By maintaining control over the data, companies can eliminate the overall risks of identity theft, fraud, and other illicit activities.

Ethical handling of data

Organisations maintaining data must ensure that they have obtained consent from clients for collecting, using, and sharing their data. This is where data privacy best practices become an ethical responsibility for organisations. As a matter of fact, by adhering to such best practices, businesses can showcase their commitment to respecting all individuals' rights while boosting transparency in their business operations.

Legal and regulatory compliance

There are many data privacy laws and regulations already in place, such as the General Data Protection Regulation (GDPR) in the EU, the Digital Personal Data Protection Act in India, the Loi 25 in Quebec (Canada), the California Consumer Privacy Act (CCPA) in California, and many others. These regulations make it obligatory for businesses to enforce stringent measures that help protect their customers' and clients' data protection rights. Furthermore, adhering to such privacy regulations allows you to avoid hefty fines, which can be millions of dollars.

Confidence and trust

As mentioned above, by meeting data privacy regulations, companies can also establish trust and confidence among their customers. By showing their adherence towards data protection regulations, businesses can build a reputation for reliability and integrity with their clients. This way, you can strengthen your trust and confidence, which will, in turn, help you develop a long-lasting relationship.

Helping individuals control their data

Data privacy regulations help individuals maintain full control over their personal data. This, in fact, allows them to decide how the data is collected, used, or shared. Furthermore, this enables them to have autonomy and ensures that the provided data is not used for illicit means or exploited without consent. In summary, data privacy empowers individuals to take control of their personal information.

Drives innovation

You will be amazed to know that data privacy is not just about protecting individuals' data but also about powering innovation. Thinking how? Well, as already mentioned above in this article, organisations use personal data to gain valuable insights into their business operations and how customers are interacting with their products and services. So, if your customers are already assured that you are adhering to the data protection regulations and maintaining their confidential information with the utmost caution, they will easily allow you to use their information for personalised experiences, advanced searches, developments, and more.

Conclusion

If you take a closer look around you, you will find that data is everywhere. You are surrounded by facial recognition cameras, smart speakers that listen to your conversations, wearable health monitors, and other data-gathering gadgets. All these devices are gathering your information to use in the future to make their business more customer-friendly. However, these practices must be regulated by a law, which will allow the ethical use of personal information. That is why data privacy laws are essential to protect the data of individuals and to ensure that organisations can grow and scale forward by using this data, while adhering to certain standards and best practices.