Privacy risk assessments are a huge asset for any business or organization that wants to understand where their data is vulnerable. By conducting a privacy risk assessment, you develop the tools you need to detect privacy issues now and down the road. It’s always better to address problems before they arise rather than cleaning up the aftermath of a catastrophe.
Privacy risk assessments also help you ask some important questions internally? What information do you need to disclose? How are you communicating with your customers about their options for disclosing personal information? Does your data collection align with your business strategy? How does it sync up with your company values?
Undertaking a privacy risk assessment now also demonstrates to your staff, stakeholders, customers, and the public that your business takes privacy risks seriously. This facilitates trust internally and externally and helps everyone involved make better, more informed decisions.
These are just the reputational benefits. Fiscally, addressing privacy risks head-on prevents massive losses. The average cost of a data breach is $3.92 million. Most of this cost stems from the loss of business, which can last well beyond the initial impact and cleanup. According to data from 2019, 67% of costs associated with data breaches occurred in the first year, but 22% followed in the next year, and 11% the year after.
Not surprisingly, most Americans don’t trust companies with their data. According to a 2019 Pew Research Center study, 62% of Americans don't think it's possible to avoid data collection. 79% of them are concerned about how the data is being used. The trust gap is significant. However, by taking steps early on to create a business culture focused on privacy, you can demonstrate to your customers that you take their concerns seriously.