If your company is US-based and you sell to US customers outside of California, you might think you’re not covered by any privacy regulation. You may be correct, but not for long. In addition to California, several states have enacted privacy regulations effective in 2023. Yes, you read that right —2023! Following California’s prime mover advantage, at least 27 US states are proposing their own data privacy laws. What does that mean for you? Time to buckle up and dive into a Privacy by Design strategy.
What is Privacy by Design?
Privacy by Design was first introduced by Ann Cavoukian, the Assistant Information and Privacy Commissioner of Ontario. She proposed seven foundational principles that should govern any IT system employing personal information. Her Privacy by Design principles serve as a blueprint for companies to take proactive, not reactive, responsibility for handling and processing personal data. Today, the Privacy by Design framework aims to weave data privacy into the fabric of business strategy and operations, from IT systems to marketing to product development.
Based on Cavoukian’s Privacy by Design principles, here are seven practical tips on incorporating Privacy by Design into your business. In doing so, you’ll be helping your company avoid legal fines and penalties; mitigate risks and liabilities; enhance your company’s brand and reputation, and build stakeholder trust as a competitive advantage.
Privacy by Design Best Practices
- Be proactive, not reactive.
The key here is to consider privacy issues upfront in everything you do. This will help you comply with the fundamental principles of privacy laws. It will also demonstrate your company’s privacy accountability. An ounce of prevention is better than a pound of cure! You don’t want to scrap a product you’re ready to launch just because you failed to consider its harmful privacy impacts at the product design stage. Data privacy considerations should be recognized at the beginning and in every step of product development. Suppose the product development team plans a new product, such as facial recognition technology or voice assistants for smart home devices. In that case, they need to consider privacy protection features at the design stage. For example, a good start is designing indicator lights to alert users that a product’s camera or microphone is turned on. The product team will also need to collaborate with the marketing team to effectively communicate the new product’s features. The marketing team can then develop communication materials to let customers know about the new features that may affect their data privacy rights.
- Privacy must be the default setting.
Privacy by Design ensures the maximum degree of privacy by default. It shouldn’t be up to individuals to protect their personal data. It's optional for individuals to share their information with others. Throughout all aspects of your business, from CRM databases to marketing cookies, individuals shouldn’t need to take additional action to protect their information. When a user accesses your website, and that cookie preference popup appears, every preference should be set to “off” (except performance cookies) unless such user proactively turns them on. Yes, this may be cumbersome to implement, but it’s in your best interest to create a privacy-first marketing strategy.
- Privacy must be embedded into the design of all processes.
Privacy measures shouldn’t be just an afterthought or a mere add-on. Instead, they must be fully integrated components of your business operations. Are you starting a new project? Upgrading your IT systems? Evaluating a third-party vendor? Protecting data privacy must be one of the fundamental criteria you need to meet at the beginning of every initiative. You can achieve this by scheduling regular Privacy Impact Assessments (PIA), which enable you to identify and mitigate data privacy risks in any new product, service, or initiative your organization undertakes.
- Approach privacy integration with a win-win mindset.
Given the ever-evolving landscape of emerging privacy regulations, privacy protection isn’t an option; it’s an imperative. So don’t treat privacy as a zero-sum game, in which implementing it means trading off some other business goals. Both privacy and security are essential, and prioritizing one over the other is a false choice. On the other hand, choosing both privacy and security creates a positive-sum result, including gaining a competitive advantage for your company. Consumers want data privacy, so go ahead and meet their demands. Make Privacy by Design integral to your business strategy to get an edge over your competitors.
- Implement end-to-end data security.
All personal data should be securely retained and destroyed when no longer needed. From the time data enters your system to the time it’s destroyed, you must ensure that personal data is secured throughout its entire lifecycle in your business systems. Encryption is one way to secure personal information that will prevent third parties from accessing data while it moves around your organization’s business process. Regular audits of your security infrastructure are also essential practices to protect your company’s data from security breaches.
- Be visible and transparent.
Transparency assures stakeholders that whatever your business practice or technology, it’s operating according to your stated promises and objectives. Customers need to be confident that their personal information is collected for stated purposes, subject to independent verification. Transparency is crucial for protecting personal information. Let’s remember not to be elusive about privacy like Amazon, as this will stir mistrust in your brand and reputation.
- Privacy must respect users.
Prioritizing data privacy should be part of your company’s overall user experience (UX). It should be easy for people to know when their data is being collected, whether it is via a popup privacy notice or an indicator light on a recording device. They should be able to update or edit their data efficiently. They should be able to delete their account from your system. Don’t hide that button deep in the footer of some obscure page on your website. Good privacy UX will encourage customer success.
Privacy by Design: The Short of It
Privacy by Design is about proactively embedding privacy protection into every aspect of your business.
✅ Conduct regular privacy impact assessments and audits on new products, services, or programs to identify and mitigate privacy risks before you launch them.
✅ Provide your employees with privacy awareness training to understand how Privacy by Design can be integrated into their work.
✅ Tell the world about the significant steps your company is undertaking as it progresses in its privacy maturity journey!
❌ Pretend you’re protecting personal data privacy if you’re not. It will inevitably lead to customers mistrusting your brand, decreasing your growth and revenues.
❌ Put privacy on the back burner. Many state data privacy laws will be effective in 2023 --- and that’s just right around the corner! Get started on your privacy accountability journey now before it’s too late.
❌ Approach privacy as a superficial tick-the-box exercise. Otherwise, you’ll miss an invaluable business opportunity to gain a competitive advantage and build trust with your stakeholders.
As consumer expectations change and new data privacy regulations take effect, businesses must take a privacy-first approach. If you need help getting started with your privacy programs, let us know. Check out our solutions to learn more.