What Skills Should Be Looking For In An IT Specialist?
What Is IT Compliance? Here’s What You Need To Know
Any business that promotes and performs digital services, has an online identity, or uses electronic systems to collect and store data is required to meet certain IT compliance standards.
IT compliance regulations are designed to help safeguard the sensitive data of billions of people worldwide by providing security for consumer data, the regulations to secure it, and regulatory compliance to oversee businesses.
Without IT compliance standards and guiding regulations being put in place and enforced, data breaches are more likely to occur, resulting in the loss of financial and sales data, leaks of clients’ private information, and even drained bank accounts which could sink businesses and ruin lives.
Although many of these regulations are mandatory by law, IT compliance standards also incorporate a number of information security best practices which can benefit your organization beyond merely the specified requirements.
Most of these regulations originated in the mid-to-late 1990s, after the Enron scandal revealed how easy it was for corporations to manipulate data for illegitimate gain. As access to and use of technology for all purposes grew, so did the number of ways in which companies could exploit it. As a result, there are now many regulatory bodies around the world that issue rules affecting technology and all of its uses.
Standards for IT compliance can vary greatly by industry, the size of the business, its geographical location, and even the types of customers it serves.
Specific guidelines are laid out for each rule within the standards so that organizations clearly comprehend how to comply. In order to avoid noncompliance with these regulations, every rule must be followed to the letter.
As such, meeting IT compliance standards demands careful planning, defining policies and procedures, and executing them precisely. Failing to comply with these requirements can cost a company millions of dollars in fines and runs the risk of incurring other penalties as well.
Recent trends – such as Bring Your Own Device (BYOD) policies and the increasing prevalence of Internet of Things (IoT) devices – have made IT compliance burdensome and bewildering for many organizations. In an effort to achieve and remain in compliance, companies often employ specialized digital tools to continuously identify, monitor, audit, and report adherence to standards.
The role of IT compliance continues to grow, as the electronic sharing and storing of information has an impact on departments such as finance, human resources, and operations – all of which depend on IT services for gathering, disseminating, and reporting data.
Given the amount of data captured and stored by companies today, IT compliance is quite possibly the most important factor in any business.
What Is IT Compliance?
By way of definition, IT compliance is the process of adhering to legal, internal, or contractual requirements for IT systems and processes with regards to the security, protection, availability, and integrity of sensitive data.
Compliance regulations are often centered around the requirements of a third party, such as industry standards, government policies, security frameworks, and terms of agreement with clients and business partners.
In essence, IT compliance involves taking appropriate control of businesses’ or clients’ information, including how it’s obtained and stored, how it’s distributed internally and externally, and how the data is secured.
Being compliant with a particular set of standards means that all relevant aspects of the business required to conform to those standards actually do so, and that the company can definitively prove that fact.
Who’s Responsible for Meeting IT Compliance Standards?
While the framework of IT compliance regulations is established by third parties, companies are responsible for their own IT compliance measures.
Organizations are not only charged with defining, documenting, and analyzing the processes to be adhered to, but also ensuring the availability of information and defining the rules of internal and external communication.
Ensuring that all applicable requirements are implemented in accordance with the rules lies with the individual or department tasked with IT compliance management. This is also where it’s determined which requirements apply to the company in the first place, as well as how they can be implemented in the best way possible. In addition, IT compliance management is tasked with keeping up-to-date on changes in legislation and ensuring that any necessary adjustments to IT are made in a timely manner.
While some companies utilize compliance management systems or software, others may choose to employ a dedicated compliance officer. Both options are intended to ensure proper compliance with and monitoring of the agreed-upon processes and rules.
5 Benefits of IT Compliance
Avoid Fines and Penalties
Organizations found to be in breach of IT compliance requirements can expect to face steep financial penalties for violations, as well as legal ramifications and other aggressive enforcement actions – especially following a data breach.
Protects Your Business’s Reputation
A single data breach can cause considerable harm to your company’s reputation. It creates the impression that your business can’t be trusted and doesn’t take the appropriate steps to protect the privacy and security of its customers. If customers feel like they can’t trust you with their sensitive information, your business is doomed! By adhering to IT compliance standards, you’re positioning your business to be better protected against data breaches while simultaneously safeguarding the privacy of your customers, clients, employees, and the business itself.
Puts You in Good Company
Many organizations have invested significant time and resources to achieve and maintain compliance with industry-specific guidelines with regards to data security – accordingly, they may be reluctant to partner with organizations that haven’t done the same. Maintaining IT compliance assures prospective partners in your industry that you’ve done your due diligence to secure the data you collect. In doing so, you’re projecting your company as an industry leader when it comes to security and a reputable partner in business.
Builds and Maintains Customer Trust
Modern consumers want reassurance that any personal or financial information they hand over to your business will remain protected. Any proof otherwise will scare away prospects, current clients, and even employees. When your organization proves itself capable of meeting lofty standards concerning digital security and privacy (even those that aren’t specifically required by law), your current customers will feel more secure when using your services and you’ll be more likely to win new business with security-minded customers.
Any company entrusted with collecting and processing customer information must be vigilant to ensure that this confidential data remains confidential. As you begin to implement various protocols in an attempt to meet compliance requirements, you’re essentially working on shielding your network from intrusions. Most IT compliance standards are merely an extension of basic security protocols. Achieving and maintaining IT compliance can help streamline your processes, decrease the chances of outside attacks, and even deter malicious insider attempts. Complying with industry standards can also help identify any gaps in your existing IT security strategy which might have otherwise gone unnoticed.
Common IT Compliance Standards
Every state in the U.S. has data breach notification laws requiring businesses to notify customers in the event that their personal information is compromised. In addition, U.S. companies may be subject to the authority of one or more federal regulatory agencies, including the Securities and Exchange Commission (SEC), Federal Communications Commission (FCC), and the Federal Trade Commission (FTC).
With respect to IT compliance, every industry has its own set of unique requirements. As such, there’s no single IT compliance standard for all businesses. In some instances, an organization may have to adhere to several different types of compliance regulations, depending on the industries within which the business operates.
Compliance requirements can vary tremendously from state to state, and some apply regardless of whether your business is located in the state. For example, both the California Consumer Privacy Act and the NYDFS Cybersecurity Regulation impose requirements that can pertain to a business in any state, provided that it deals with data relating to these acts.
In addition to federal, state, and local government agencies, any organization charged with protecting data in order to ensure its confidentiality, integrity, reliability, or availability is likely answerable to IT compliance regulations. This last group includes most employers, colleges, and universities.
Businesses most commonly affected by IT compliance – and most in need of setting up a framework for compliance – include financial institutions, retailers, e-commerce, healthcare and health insurance, other insurance institutions, banking, defense, utilities, and credit card issuers. Strict compliance requirements also apply to critical infrastructure in sectors such as energy, government, food, transportation, information technology, telecommunications, and media.
Let’s take a look at some of the most common IT compliance standards to help you determine which regulations may apply to your organization:
Health Insurance Portability & Accountability Act (HIPAA)
This government-mandated compliance standard applies to hospitals, clinics, health insurance providers, employers that offer health insurance to their employees, and any organization that stores, collects, transfers, accesses, or otherwise handles healthcare data.
Failure to comply with HIPAA requirements can tarnish a company’s reputation, result in steep fines, and even bankrupt an entire organization.
Key standards enforced by HIPAA include:
- Maintaining privacy regulations that restrict the disclosure of healthcare information without first obtaining the patient’s consent
- Ensuring that businesses rigorously secure any files containing electronic protected health information (ePHI) by implementing administrative, physical, and technical structures preventing unauthorized individuals from accessing patient data
- Implementing a notification system that immediately alerts businesses and patients in the event that a security breach or threat occurs
Payment Card Industry Data Security Standard (PCI DSS)
This set of regulations was initiated by MasterCard, Visa, and other credit card companies in an attempt to minimize financial fraud by better securing customers’ credit card information.
Any business that stores, transmits, or processes customers’ credit or debit card data and payments must act in accordance with the rules governing those practices and operations as outlined in PCI DSS.
Compliance with this standard results in greater transparency and increases the trustworthiness of businesses managing these types of transactions, assuring customers that their financial information is protected and they can safely make purchases. Conversely, failing to adhere to PCI DSS requirements could subject a company to substantial financial penalties.
While this particular compliance standard isn’t government-mandated, it’s one that most businesses are compelled to meet. This is because major credit card companies like Visa and MasterCard require businesses to have PCI DSS validation.
In order to meet the requirements of this standard, businesses must develop robust systems and processes for hosting and protecting customers’ financial information. Monitoring accounts and being constantly on the lookout for potential security threats is one way of achieving this. Another option is to implement granular controls which limit who can access different parts of a customer’s account. Limiting access prevents unauthorized individuals from accessing the account information that can be used to steal customers’ identities.
Sarbanes-Oxley Act (SOX)
In the wake of the Enron incident, U.S. Congress passed this federal law for the purpose of overseeing how organizations handle electronic records, data protection, internal reporting, and executive accountability.
SOX ensures that companies reveal complete and accurate financial information so stakeholders and the general public can make informed decisions before choosing whether to invest in the business. In addition, this compliance standard helps minimize the risk of accounting errors and deter fraudulent practices.
Any publicly traded company or business making an initial public offering (IPO) is required to meet this standard. Company boards, management personnel, and accounting firms are also bound by SOX. Failure to comply can result in stiff criminal penalties.
In terms of network compliance, SOX deals with policies regarding where data is stored, establishing access controls, and the flawless installation of backup procedures.
Federal Information Security Management Act (FISMA)
Established in 2002, FISMA establishes a minimum requirement for federal agencies developing data protection plans, promotes certain types of security software and systems, verifies third-party vendors, and accounts for the different security needs of various governmental departments.
Essentially, the act demands that federal agencies treat information security as a matter of national security. While government agencies must adhere to FISMA compliance standards, businesses that work with government agencies may also need to be aware of these regulations. Failure to comply with FISMA can result in loss of federal funding and inability to enter into government contracts.
General Data Protection Regulation (GDPR)
This regulation applies to any organization – public or private – that collects and processes the personally identifying information of any European Union (EU) citizen or resident. Any company, regardless of its geographical location, that wishes to do business in the EU or handle the personal or financial data of people from the EU must comply with GDPR standards.
According to the GDPR, organizations must first ask the permission of “data subjects” (i.e., EU citizens or residents) before collecting their personal data. This offers users the opportunity to opt-in or opt-out of data collection. If the individual opts out, the organization must delete any previously collected information.
Gramm-Leach-Bliley Act (GLBA)
Enacted in 1999, the GLBA requires institutions to inform customers of their privacy policies on an annual basis, particularly in regard to how information is shared with certain third parties. Organizations are compelled to give customers the opportunity to opt-out if they don’t wish for their information to be shared. In addition, companies must disclose what measures they’re taking to safeguard the personal data of their customers.
Financial institutions – such as banks, savings and loans, credit unions, insurance companies, and financial advisory firms – as well as accountants, real estate agencies, and universities are all subject to GLBA regulations.
The three “rules” of the GLBA include: financial privacy (how institutions can collect and share private financial information); safeguarding (how institutions must implement security measures to protect client information against cybersecurity risks); and pretexting (this prevents businesses from collecting data under false pretenses).
There are a number of challenges associated with IT compliance. Following these tips can help your company avoid the extravagant fines, penalties, and other legal consequences associated with noncompliance:
- Educate your employees on all aspects of data privacy and provide them with the tools they need to protect sensitive data.
- Provide mobile and remote employees with laptops and devices that contain security policies and prevention mechanisms (such as remote-wipe capabilities) in order to maintain secure access to corporate data.
- Put authorization mechanisms in place to limit access to downloadable applications. Only allow downloads of approved software and applications.
- Enforce encryption for security and prevent access by devices without secure access.
- Utilize only secure and modern cloud storage solutions.
Ensuring that your organization achieves and maintains IT compliance begins with identifying the regulations that apply to your line of business. Drilling down to the areas of interest for your specific organization can help you design and implement the proper compliance frameworks. This can be a challenging and confusing process, especially if you’re inexperienced in these matters.
While it’s possible to manage IT compliance internally, it’s not the best way to go. The process is lengthy and will only serve to distract you from your core business responsibilities. Why go through all that stress when you can outsource this service for just a fraction of your IT budget?
At DataGroup Technologies, compliance is more than a service we provide – it’s woven into the fabric of all of our IT solutions. We can help you build an IT environment that not only supports your business’s growth but meets the necessary IT compliance standards as well.
Blog post text…
Blog post text…