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GDPR vs Privacy Shield: What are the Key Differences?

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The European Union’s General Data Protection Regulation (GDPR) went into effect in 2018, imposing a strict privacy regime to control how organizations can collect, use, and store the personal information of EU citizens. GDPR violations can bring stiff penalties, so organizations anywhere in the world must be mindful of its requirements.

In 2016, the EU-U.S. Privacy Shield framework was launched in response to a 2015 ruling by the Court of Justice of the European Union (CJEU). That ruling had invalidated Privacy Shield’s predecessor, the International Safe Harbor Privacy Principles, which had been used to govern data exchange between the United States and the EU (and Switzerland).

Although the Court of Justice subsequently invalidated the Privacy Shield framework in 2020, businesses must still comply with some Privacy Shield requirements. For organizations that operate globally, understanding the GDPR and Privacy Shield is critical to comply with privacy regulations as you do business in Europe and around the world. 

There are, however, important differences between the two rules. Those differences are explored in this article.

What Is the GDPR?

The General Data Protection Regulation (GDPR) arose from increasing public concerns over privacy and how companies use consumer data in the Internet-driven information age. The GDPR includes provisions that require organizations to implement adequate safeguards to protect the data and privacy of citizens in the 27 EU member states.

The GDPR was also among the 69 EU legal acts incorporated into the EEA Agreement by the EEA Joint Committee in Brussels in July 2018, making it also binding for European Free Trade Association (EFTA) countries.

The law also defines the rights of EU residents and consumers regarding collecting and using their data. Those include the right to consent and the “right to be forgotten” — that is, the right to demand a company to erase one’s data.

Types of Data Protected by the GDPR

The word “data” under the GDPR encompasses a wide range of information, including:

  • Personal identifiers, such as names, addresses, and national ID numbers
  • Health and genetic data
  • Racial and ethnic data
  • Political opinions
  • Web browsing cookies, IP addresses, and RFID tags
  • Biometrics

Who Is Subject to GDPR Compliance?

The GDPR is not limited only to companies operating in the EU. GDPR compliance applies to any company in any country that collects or processes the personal data of EU citizens — even if that company does not have a business presence in the EU.

Companies must also comply with the GDPR if they have:

  • A presence in any EU country
  • More than 250 employees
  • Fewer than 250 employees but are involved in data processing for certain types of sensitive data

So as a practical matter, the GDPR affects data and privacy protection requirements on a global scale.

Penalties for Non-Compliance 

EU privacy regulators (formally known as “supervising authorities,” or SAs) can investigate reports of GDPR violations and impose penalties and fines on non-compliant firms. These fines may be up to 4 percent of the offending organization’s total global revenues or €20 million, whichever is greater. Those supervising authorities can also require companies to implement corrective actions such as:

  • Performing audits to ensure compliance
  • Implementing specified improvements by prescribed deadlines
  • Erasing certain collections of data

Privacy regulators may also block non-compliant companies from transferring data to other countries.

The GDPR places equal liability on organizations that possess the data (“data controllers”) and on third-party organizations that help data owners to manage that data (“data processors”). If processors aren’t compliant, their customer organization (that is, the data controller) is also considered non-compliant. Regulators may then impose the above penalties on both firms.

What Was Privacy Shield?

The EU-U.S. Privacy Shield framework was designed to allow data transfer between U.S. and EU companies during transatlantic commerce while still in compliance with U.S. and EU privacy regulations. It was declared invalid by the European Court of Justice in 2020 in the case filed by Max Schrems, also referred to as the “Schrems II” case.

The Trans-Atlantic Data Privacy Framework, meant to replace it, was agreed upon by the Biden Administration and the European Commission in March 2022 and later renamed the EU-U.S. Data Privacy Framework.

The European Union concluded in July 2023 that this new framework ensures an adequate level of protection, allowing a secure flow of information back and forth between the United States and the European Union.

Differences Between the GDPR and Privacy Shield

Both the GDPR and Privacy Shield have a common objective: to protect user data and privacy while allowing organizations to conduct business with minimal disruptions. Despite these similarities, they differ in the following ways:

Applicability

The GDPR applies to all companies worldwide if they collect or store the data of EU data subjects, regardless if they are based in Europe. Privacy Shield only applies to U.S. companies doing the same.

Legality

The GDPR’s obligations are legally binding, so organizations cannot simply “opt out” of compliance. On the other hand, they can choose to comply with Privacy Shield by self-certifying their adherence to the U.S. Department of Commerce. The GDPR has no such voluntary self-certification process, and the steps for GDPR compliance are more rigorous.

Once Privacy Shield self-certification is complete, a company must comply with its requirements. Non-compliance penalties include removal from Privacy Shield, so the organization may no longer be allowed to receive personal data from the EU.

Enforcement

Enforcement of the GDPR is carried out by EU member states’ Data Protection Authorities (DPAs) and by EU courts, including the European Court of Justice; those regulatory enforcement actions and court judgments cannot be ignored.

The Privacy Shield framework is jointly controlled by the U.S. Federal Trade Commission (FTC) and the Department of Commerce, although enforcement responsibility lies with the FTC.

Legal Interpretation

The GDPR can only be interpreted through EU courts, not by government representatives. In contrast, Privacy Shield can be interpreted outside the judicial system. Privacy Shield is reviewed annually by government representatives from the EU and the United States, and either party has the right to invalidate the framework.

Interpretation of Human Resources Data

Human resources (HR) personal data is interpreted differently under the GDPR and Privacy Shield. Under the GDPR, HR data is any employee data in the context of the employee-employer relationship; under the Privacy Shield, the term only refers to the data of employees within the same organization.

For example, when employee data is transferred to a third party, Privacy Shield considers it commercial data rather than a transfer of personal data. GDPR considers employee data as personal data regardless of whether the data is transferred to another party. This difference in interpretation is a point of contention between the U.S. and EU review groups.

Penalties for Non-Compliance

Per the GDPR, regulators can reprimand, sanction, or impose fines on non-compliant companies. They may publicly name such companies and require them to conduct external audits. EU data protection authorities will also investigate data breaches that potentially resulted from GDPR non-compliance.

Privacy Shield non-compliance brings less attention and punishment. The Department of Commerce controls a list of U.S. organizations that have been removed from Privacy Shield. The Federal Trade Commission may impose penalties such as:

  • Fines
  • Injunctive awards
  • Cease-and-desist orders
  • Removal of all personal data received under the program
  • Civil actions

Choosing Between GDPR and Data Privacy Framework

If your company processes the personal data of EU citizens, you must comply with the GDPR. The GDPR is a more extensive and strict law than the Privacy Shield, offering a greater level of protection.

If your company is based in the United States and does not process the personal data of EU residents, but expects to transfer or receive information from companies under the GDPR regime, you should comply with the new U.S.-EU Data Privacy Framework regulations. That will enable compliance with the GDPR‘s foreign transfer of personal data rules from your suppliers or customers in Europe.

Let ZenGRC Help with GDPR Compliance

Instead of using spreadsheets to manage your privacy compliance requirements, use ZenGRC’s governance, risk, and compliance platform to streamline evidence and audit management for all of your compliance frameworks.

Leverage its integrated and automated system of record to assure that your business systems and data are compliant and safe. ZenGRC gives you complete views of your control environments and provides easy access to insightful reporting and dashboards to help you evaluate your compliance program and address critical risks.

If you want to move from check-the-box compliance to compliance-driven security, let ZenGRC be your partner. Schedule a demo to learn about ZenGRC.

What Does PCI DSS Stand For?

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In the digital age, where every transaction and click leaves a footprint, the security of payment card information has never been more crucial. Enter PCI DSS, a standard that has become synonymous with the secure handling of credit and debit card transactions. But what exactly does PCI DSS stand for, and why is it so vital for businesses and consumers alike? In our latest blog titled “What Does PCI DSS Stand For?” we delve into the origins, importance, and implications of the Payment Card Industry Data Security Standard. Whether you’re a business owner, a security professional, or simply someone who uses a credit card, understanding PCI DSS is key to navigating the modern landscape of digital payments.

What Does PCI DSS Stand For?

The Payment Card Industry Data Security Standard (PCI DSS) is a set of security measures formulated by leading credit card companies. Its primary aim is to safeguard the personally identifiable information (PII) of cardholders against unauthorized access and data breaches. This comprehensive standard mandates banks, retailers, and any entity dealing with credit card transactions to maintain a secure environment for handling sensitive cardholder data.

Under PCI DSS, cardholder data (CHD) encompasses not only the primary account number but also the cardholder’s name, the card’s expiration date, service code, and other critical details. To ensure the safety of this information, PCI DSS requires that all aspects of CHD — whether stored, transmitted, or processed — are protected within a rigorously secure environment. Adhering to these standards is crucial for any entity handling credit card information to prevent data theft and maintain the integrity and trust of the payment ecosystem.

PCI DSS vs. PCI SSC, What’s the Difference?

When discussing payment card security, two acronyms you might come across are PCI SSC and PCI DSS. They are related but refer to different things within the realm of payment card security. Here’s a brief overview of each:

PCI SSC (Payment Card Industry Security Standards Council)

  • What It Is: PCI SSC stands for Payment Card Industry Security Standards Council. It is an organization that was founded in 2006 by major credit card companies (Visa, MasterCard, American Express, Discover, and JCB).
  • Role: The council’s role is to enhance global payment account data security by developing standards and supporting services that drive education, awareness, and effective implementation by stakeholders.
  • Responsibilities: The council is responsible for the development, management, education, and awareness of the PCI security standards, including the Data Security Standard (PCI DSS), Payment Application Data Security Standard (PA-DSS), and the Point-to-Point Encryption Standard (P2PE).
  • Membership and Involvement: It includes members from all parts of the payment card chain and provides a forum for them to contribute to the development of security standards.

PCI DSS (Payment Card Industry Data Security Standard)

  • What It Is: PCI DSS stands for Payment Card Industry Data Security Standard. It is one of the standards created and maintained by the PCI SSC.
  • Purpose: This standard outlines the necessary security measures that any organization that processes, stores, or transmits credit card data must implement and maintain. Its primary goal is to protect cardholder data from theft and unauthorized access.
  • Requirements: PCI DSS consists of a set of requirements focusing on security management, policies, procedures, network architecture, software design, and other critical protective measures. This comprehensive standard aims to ensure that all companies that handle credit card information maintain a secure environment.
  • Compliance: Compliance with PCI DSS is mandatory for all entities involved in payment processing, including merchants, processors, acquirers, issuers, and service providers, to protect sensitive cardholder information.

In summary, the PCI SSC is the governing body that creates and manages standards like PCI DSS to ensure the secure handling of payment card information globally. While PCI SSC sets the standards, PCI DSS is the specific set of requirements that organizations must follow to secure cardholder data effectively. Understanding the distinction between the two is crucial for any entity involved in payment card processing.

What Is Required for PCI Compliance?

For merchants processing credit card transactions, PCI compliance is not just a recommendation; it’s a mandatory measure to ensure the security of cardholder data. Compliance involves establishing a robust information security policy that mandates storing sensitive card data on a secure network, distinctly segregated from public networks. Failure to comply with the Payment Card Industry Data Security Standard (PCI DSS) can lead to substantial fines, reputational damage, and in severe cases, the loss of the ability to process credit card payments.

The PCI DSS framework is structured around 12 fundamental principles, further detailed into 78 standards and 281 specific controls. While not every business is required to implement all 281 controls, the 12 overarching principles are mandatory, with the applicable controls varying based on the business’s size and operations.

Key Principles for PCI Compliance include:

  1. Install and maintain firewalls: To create a barrier between sensitive data and unsecured networks.
  2. Implement secure password practices: Utilize strong password protocols and consider multi-factor authentication for additional security.
  3. Protect stored cardholder data: Ensure data is encrypted and access is strictly controlled.
  4. Encrypt transmission of cardholder data across open networks: Safeguard data in transit to prevent interception or tampering.
  5. Use and regularly update antivirus software: Deploy antivirus solutions and ensure they are up-to-date to combat new threats.
  6. Develop and maintain secure systems and applications: Regularly patch and update systems to close off vulnerabilities.
  7. Restrict access to cardholder data by business need-to-know: Limit data access based on roles, ensuring only necessary personnel can view sensitive information.
  8. Assign a unique ID to each person with computer access: Track and monitor individual interactions with cardholder data.
  9. Restrict physical access to cardholder data: Implement measures to prevent unauthorized physical access to data storage areas.
  10. Monitor and test networks regularly: Continuously check systems for vulnerabilities and promptly address any issues.
  11. Maintain an information security policy: Develop, disseminate, and regularly update a comprehensive security policy.
  12. Regularly test security systems and processes: Conduct periodic evaluations to ensure that security measures are effective and up to date.

By adhering to these principles and the applicable controls, businesses can not only avoid penalties but also fortify their defenses against data breaches, thus maintaining the trust of their customers and the integrity of their operations.
Who Must Comply with PCI DSS?

Any organization that processes, stores, or transmits payment card information must comply with the Payment Card Industry Data Security Standard (PCI DSS). This encompasses a broad range of entities including:

  • Merchants: Any business accepting card payments, regardless of size or transaction volume.
  • Payment Processors: Companies that handle card transactions on behalf of merchants.
  • Banks and Financial Institutions: Entities that manage credit or debit card processing and related services.
  • Service Providers: Any third-party that affects the security of cardholder data, such as hosting providers, payment gateways, and outsourced IT services.

Compliance is mandatory for these entities to ensure the secure handling of sensitive payment card information and maintain the integrity of the payment ecosystem.

Benefits of PCI DSS Compliance

Complying with PCI DSS brings a multitude of benefits that go beyond just meeting regulatory requirements:

  • Enhanced Security: By adhering to strict security standards, organizations can significantly reduce the risk of data breaches and fraud.
  • Increased Trust: Compliance demonstrates to customers and partners that you take data security seriously, enhancing your reputation and customer trust.
  • Competitive Advantage: Being PCI compliant can distinguish your business in the market, especially when consumers are more aware of and concerned about data security.
  • Avoidance of Fines: Compliance helps avoid costly fines and penalties associated with non-compliance.
  • Better Risk Management: Understanding and implementing the required controls provides a better insight into your security posture and helps in identifying potential vulnerabilities.

Consequences of PCI Non-Compliance

Failing to comply with PCI DSS can have severe repercussions for any organization:

  • Financial Penalties: Non-compliant organizations can face substantial fines from credit card companies and banks. These fines can escalate with each month of non-compliance.
  • Reputational Damage: A breach resulting from non-compliance can lead to significant loss of customer trust and damage to the brand’s reputation.
  • Legal Consequences: In the event of a data breach, non-compliant entities might face lawsuits and legal fees.
  • Operational Disruptions: After a breach, an organization might need to halt operations to investigate and address the security lapse, leading to potential loss of revenue.
  • Loss of Credit Card Privileges: In severe cases, an organization might lose the right to process credit card payments, which can be devastating for any business that relies on card transactions.

Understanding who needs to comply, the benefits of meeting the standards, and the consequences of neglect are crucial for any organization handling cardholder data. Compliance is not just about avoiding penalties; it’s about safeguarding your business, protecting your customers, and ensuring a secure and trustworthy payment environment.

How Does PCI Compliance Happen?

To achieve PCI DSS compliance, a merchant should first determine which level of compliance it needs to achieve. PCI DSS has four levels, determined by the volume of credit card transactions you process annually; and the level you must achieve then determines how many PCI controls and processes you must have in place.

  •   Level 1: more than 6 million transactions
  •   Level 2: 1 million to 6 million transactions
  •   Level 3: 20,000 to 1 million transactions
  •   Level 4: fewer than 20,000 transactions

Merchants in the Level 1 category must have their PCI compliance program reviewed annually by an independent “Qualified Security Auditor” (QSA). Merchants in the lower levels can perform this review themselves using a Self-Assessment Questionnaire (SAQ). The SAQ determines what information the merchant collects and where the merchant stores, transmits, and processes that data.

A PCI Self-Assessment Questionnaire must be finished as part of your yearly compliance procedures. You must respond to several yes-or-no questions on each PCI DSS criteria while completing your SAQ. If you answer “no” to a question, you could be required to elaborate on your reasoning or the current state of your remediation efforts.

Next, the company creates a series of security parameters that establish access control measures. These measures can include security systems limiting physical access, firewall configurations, strong system passwords, antivirus software, and a vulnerability management program.

Once your SAQ and all remediation are complete, you must submit a “certificate of compliance” to the PCI Security Standards Council.

What are PCI DDS requirements?

The Payment Card Industry Data Security Standard (PCI DSS) outlines a set of requirements designed to ensure that all companies that process, store, or transmit credit card information maintain a secure environment. The standard is divided into 12 main requirements, which are further broken down into sub-requirements. Here’s a summary of the main requirements:

1. Install and maintain a firewall configuration to protect cardholder data

  • Establish firewalls to protect sensitive data.
  • Prohibit direct public access between the internet and any system component in the cardholder data environment.

2. Do not use vendor-supplied defaults for system passwords and other security parameters

  • Change default passwords and security parameters before installing systems on the network.
  • Ensure security settings are strong and customized.

3. Protect stored cardholder data

  • Encrypt sensitive cardholder data when stored.
  • Minimize data retention and securely delete data no longer needed.

4. Encrypt transmission of cardholder data across open, public networks

  • Use strong encryption when transmitting cardholder data over open or public networks.
  • Never send unprotected PANs (Primary Account Numbers) by end-user messaging technologies.

5. Use and regularly update antivirus software or programs

  • Deploy antivirus software on all systems commonly affected by malware.
  • Ensure that the antivirus mechanisms are kept current and active.

6. Develop and maintain secure systems and applications

  • Regularly update and patch systems and applications to protect against known vulnerabilities.
  • Develop secure software applications in accordance with PCI DSS and industry best practices.

7. Restrict access to cardholder data by business need to know

  • Limit access to system components and cardholder data only to those individuals whose job requires such access.
  • Implement access controls to ensure that only authorized personnel can view cardholder data.

8. Assign a unique ID to each person with computer access

  • Ensure that each person with computer access has a unique ID to enable tracking and monitoring of their activities.
  • Implement strong authentication methods to verify the identity of individuals accessing sensitive systems.

9. Restrict physical access to cardholder data

  • Use appropriate facility entry controls to limit and monitor physical access to systems where cardholder data is stored.
  • Protect against unauthorized physical access, tampering, or theft.

10. Track and monitor all access to network resources and cardholder data

  • Implement logging mechanisms to track user activities related to cardholder data.
  • Regularly review logs to identify and respond to suspicious activity.

11. Regularly test security systems and processes

  • Conduct regular testing of security systems and processes to ensure they are functioning effectively and securely.
  • Perform periodic penetration testing and vulnerability assessments.

12. Maintain a policy that addresses information security for all personnel

  • Establish, publish, maintain, and disseminate a security policy covering the information security for employees and contractors.
  • Ensure that the security policy is understood and followed.

Each of these requirements has detailed sub-requirements and testing procedures associated with it. Organizations must regularly assess their compliance with these requirements and rectify any shortcomings. Compliance with PCI DSS is not a one-time event but an ongoing process of assessment, remediation, and reporting.

Compliance Management With RiskOptics ZenGRC

Navigating the complexities of PCI DSS compliance can be daunting for any organization. That’s where RiskOptics ZenGRC comes into play, offering a streamlined, efficient solution to manage your PCI compliance needs with ease and precision. This comprehensive platform is designed to simplify the compliance process, reduce risks, and ensure that you’re always one step ahead in your security posture.

Centralized Compliance Dashboard: RiskOptics ZenGRC provides a centralized dashboard that gives you a real-time overview of your compliance status. With intuitive visuals and customizable reports, you can monitor your compliance levels, track progress, and identify areas that require attention. This bird’s-eye view makes it easier to manage and maintain PCI standards across your entire organization.

Automated Control Mapping: Forget the hassle of manually matching your security controls to PCI DSS requirements. RiskOptics ZenGRC automates control mapping, ensuring that every aspect of your security measures aligns with the necessary PCI standards. This automation not only saves time but also minimizes the risk of human error, enhancing your overall compliance accuracy.

Continuous Monitoring and Alerts: Stay informed with continuous monitoring and real-time alerts. RiskOptics ZenGRC vigilantly scans your systems for any changes or deviations from the required PCI standards. If an issue is detected, you’ll receive an immediate alert, enabling you to take swift action to rectify the problem and maintain uninterrupted compliance.

Streamlined Audits and Reporting: Audits are an integral part of maintaining PCI compliance, and RiskOptics ZenGRC makes them more manageable than ever. With streamlined audit workflows, you can efficiently gather evidence, track audit progress, and generate comprehensive reports. This not only reduces the time and effort involved in audits but also helps you demonstrate compliance to auditors and stakeholders with ease.

Customizable Frameworks and Templates: Every organization is unique, and RiskOptics ZenGRC understands that. The platform offers customizable frameworks and templates that you can tailor to fit your specific business needs and compliance goals. Whether you’re a small business or a large enterprise, you can adjust the settings to match your scale and complexity.

Expert Guidance and Support: Navigating PCI compliance can be complex, but you’re not alone. RiskOptics ZenGRC provides expert guidance and support throughout your compliance journey. From initial setup to ongoing management, their team of compliance professionals is there to offer advice, answer questions, and help you optimize your compliance strategy.

RiskOptics ZenGRC is not just a tool; it’s a comprehensive solution for managing PCI compliance with confidence and clarity. By leveraging its powerful features and expert support, you can ensure that your organization not only meets but exceeds PCI DSS standards, safeguarding your data and maintaining the trust of your customers. With RiskOptics ZenGRC, achieving and maintaining PCI compliance becomes a seamless, stress-free process.

Schedule a demo to learn how we can help guide your organization to confidence in infosec risk and compliance.

What are the CCPA Categories of Personal Information?

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The California Consumer Privacy Act (CCPA), the United States’s strictest and most comprehensive data privacy law, has the broadest definition of “personal information” of any law in effect—including the European Union’s General Data Protection Regulation (GDPR). The law is so sweeping that it includes 11 categories of personal information.

The CCPA aims to prevent the sale or sharing of California residents’ (“consumers”) personal information without their permission—but it protects more than the conventional types of “personal data” such as name, telephone number, and social security number. The law considers a person’s browsing and search history, geolocation data, biometrics, and other types of information that has not been “de-identified” to be worthy of regulation, as well. 

What is Personal Information Under CCPA?

The CCPA defines “personal information” as “information that identifies, relates to, describes, is capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer or household.” 

It establishes the following categories of personal information: 

  1. Identifiers: Name, alias, postal address, unique personal identifier, online identifier, Internet Protocol (IP) address, email address, account name, social security number, driver’s license number, passport number, or other similar identifiers
  2. Customer records information: Name, signature, social security number, physical characteristics or description, address, telephone number, passport number, driver’s license or state identification card number, insurance policy number, education, employment, employment history, bank account number, credit or debit card number, other financial information, medical information, health insurance information
  3. Characteristics of protected classifications under California or federal law: Race, religion, sexual orientation, gender identity, gender expression, age
  4. Commercial information: Records of personal property, products or services purchased, obtained, or considered, or other purchasing or consuming histories or tendencies
  5. Biometric information: Hair color, eye color, fingerprints, height, retina scans, facial recognition, voice, and other biometric data
  6. Internet or other electronic network activity information: Browsing history, search history, and information regarding a consumer’s interaction with an Internet website, application, or advertisement
  7. Geolocation data
  8. Audio, electronic, visual, thermal, olfactory, or similar information
  9. Professional or employment-related information
  10. Education information: Information that is not “publicly available personally identifiable information” as defined in the California Family Educational Rights and Privacy Act (20 U.S.C. section 1232g, 34 C.F.R. Part 99)
  11. Inferences

The law also includes inferences that could be used to create a profile reflecting a consumer’s: 

  • Preferences
  • Characteristics
  • Psychological trends
  • Predispositions
  • Behavior
  • Attitudes
  • Intelligence
  • Abilities
  • Aptitudes

It gives the California attorney general the power to add categories of personal information to address changes in technology, data collection practices, obstacles to implementation, and privacy concerns.

What is not considered personal information?

Personal information, also known as personally identifiable information (PII), refers to any data that can be used to identify a specific individual. Understanding what is not considered personal information can be just as important, especially in the context of privacy and data protection. Here are some examples of data typically not considered personal information:

  1. Aggregated Data: Information that has been compiled into data summaries, usually for the purposes of public reporting or statistical analysis. For example, a report stating that “60% of users prefer online shopping” does not contain personal information.
  2. Anonymized Data: This is data from which personal identifiers have been removed. If the process of anonymization is done properly, it should be impossible to link the data back to any individual.
  3. Public Information: Data that is already publicly available and can be accessed by anyone. For example, a published article or a phone number listed in a public directory.
  4. General Information: Information that is too broad or common to identify a specific individual, such as a first name without any additional context or demographic information.
  5. Business Contact Information: In some jurisdictions, the contact information used for business purposes (such as business phone number, address, or email) is not considered personal, especially when it’s used solely in a professional context.
  6. Random Data: Data that does not relate to or describe an individual, such as random alphanumeric sequences that are not linked to personal identifiers.

It’s important to note that the classification of information as personal or non-personal can depend on the context and the jurisdiction. For instance, in some cases, even seemingly non-personal information can become personal if it’s combined with other data that makes the individual identifiable.

Why the categories matter?

The CCPA establishes new consumer rights regarding personal information. Under the law, businesses that collect personal information from consumers must inform them at or before the time of collection that they are doing so. Businesses must disclose the categories of information they are collecting and the purpose for which it will be used.

Those businesses must also provide a “Do Not Sell My Personal Information” button or link on their website’s home page.

If it receives a verifiable consumer request, a business must respond with:

  • Which categories of personal information it has collected about the consumer
  • The categories of sources of that information 
  • Its business or commercial purpose for collecting or selling it
  • Which categories of third parties, such as service providers, with which it shares personal information
  • Specific pieces of personal information the business has collected about the consumer

When selling a consumer’s personal information or disclosing it for a business purpose, a business must disclose, upon request: 

  • The categories of personal information the business has collected about the consumer
  • The categories of the consumer’s personal information the business has sold and the categories of third parties to which it sold the data 
  • Which categories of the consumer’s personal information the business has disclosed for a business purpose

Characteristics of Personal Data under the CCPA

The California Consumer Privacy Act (CCPA) is a comprehensive data privacy law that came into effect in California on January 1, 2020. It provides California residents with certain rights regarding their personal information held by businesses. Under the CCPA, personal data is defined with specific characteristics:

1. Identifiability: Personal information under the CCPA includes information that identifies, relates to, describes, is reasonably capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer or household. This broad definition ensures that a wide range of data types can be considered personal information.

2. Types of Information Included:

    • Identifiers: This includes direct personal identifiers such as a real name, alias, postal address, unique personal identifier, online identifier, IP address, email address, account name, Social Security number, driver’s license number, passport number, or other similar identifiers.
    • Characteristics of Protected Classifications: Information related to characteristics of protected classifications under California or federal law, like race, religion, sexual orientation, gender identity, etc.
    • Commercial Information: Including records of personal property, products or services purchased, obtained, or considered, or other purchasing or consuming histories or tendencies.
    • Biometric Information: Data generated from physical characteristics or activity patterns used to extract a template or other identifier or identifying information, such as fingerprints, faceprints, and voiceprints.
    • Internet or Other Electronic Network Activity Information: Such as browsing history, search history, and information regarding a consumer’s interaction with a website, application, or advertisement.
    • Geolocation Data: Precise geographic location information about a particular individual or device.
    • Audio, Electronic, Visual, Thermal, Olfactory, or Similar Information: Essentially, any sensory data related to a consumer.
    • Employment-related Information: Professional or employment-related information.
    • Education Information: Information that is not publicly available personally identifiable information as defined in the Family Educational Rights and Privacy Act (FERPA).
    • Inferences Drawn from Personal Information: To create a profile about a consumer reflecting the consumer’s preferences, characteristics, psychological trends, predispositions, behavior, attitudes, intelligence, abilities, and aptitudes.

3. Exclusions: Publicly available information is not regarded as personal information under the CCPA. Publicly available means information that is lawfully made available from federal, state, or local government records.

4. Context-Dependent: The classification of data as personal information under the CCPA can depend on the context in which the data is used. If the data can be used to reasonably identify, relate to, describe, be associated with, or impact an individual or household, it’s likely to be considered personal data.

The CCPA’s definition of personal information is broad and inclusive, reflecting a growing trend in privacy laws to provide comprehensive protections for consumer data. Businesses subject to the CCPA must understand these definitions to ensure compliance with the law’s requirements.

Who Must Comply with CCPA?

The California Consumer Privacy Act (CCPA) applies to a specific set of businesses, regardless of their location, as long as they handle the personal data of California residents. The criteria for businesses that need to comply with the CCPA are as follows:

  1. Annual Gross Revenues: Businesses with annual gross revenues in excess of $25 million.
  2. Volume of Data: Companies that buy, receive, sell, or share for commercial purposes, the personal information of 50,000 or more California residents, households, or devices annually.
  3. Income from Selling Data: Businesses that derive 50% or more of their annual revenues from selling California residents’ personal information.

It is important to note that these criteria apply to businesses operating within California as well as those located outside California if they meet the above criteria in their dealings with California residents.

How Can My Company Comply with the CCPA?

Complying with the CCPA involves several steps to ensure that your business respects the privacy rights of California residents and adheres to the regulations. Here’s a guideline for compliance:

  1. Understand the Data You Collect: Identify the types of personal information your company collects, where it’s sourced from, how it’s used, and with whom it’s shared.
  2. Update Privacy Policies: Your privacy policy should reflect CCPA requirements. This includes informing consumers about their rights under the CCPA, the categories of personal information collected, the purposes for which the information is used, and the categories of third parties with whom the information is shared.
  3. Create Consumer Request Processes: Establish procedures to respond to consumer requests. Under CCPA, consumers have the right to know about, access, and delete their personal information, as well as the right to opt-out of the sale of their personal information.
  4. Implement Opt-Out Methods: Provide a clear and conspicuous “Do Not Sell My Personal Information” link on your website’s homepage, allowing consumers to opt-out of the sale of their personal information.
  5. Train Employees: Ensure that all employees handling consumer inquiries or responsible for CCPA compliance are well-trained and aware of the procedures and timelines for handling consumer rights requests.
  6. Data Security Measures: Implement reasonable security measures to protect the collected personal information from unauthorized access, destruction, or disclosure.
  7. Vendor Management: If you share personal information with service providers or third parties, ensure that they are also complying with CCPA requirements.
  8. Regular Compliance Audits: Regularly review and audit your data practices, privacy policies, and compliance processes to ensure ongoing adherence to CCPA standards.
  9. Prepare for Consumer Requests: Have a system in place to efficiently handle and respond to consumer requests within the CCPA’s specified timelines (45 days, extendable by another 45 days).
  10. Record-Keeping: Maintain records of consumer requests and how they were responded to for at least 24 months as required by the CCPA.

By diligently following these steps, companies can ensure they are in compliance with the CCPA, thereby protecting the privacy rights of California residents and avoiding potential penalties.

FAQs for CCPA

What is an Example of Personal Information Under the CCPA?

Under the California Consumer Privacy Act (CCPA), personal information is defined broadly to include any information that identifies, relates to, or could reasonably be linked with a specific individual or household. An example of personal information under the CCPA would be:

Detailed Example: John Doe, a resident of California, subscribes to an online shopping platform. The personal information collected by this platform about John could include his full name, home address, email address, phone number, credit card details, browsing history on the platform, purchase history, and geolocation data from his mobile device. The platform may also collect inferences drawn from this data to create a profile about John’s preferences and behavior.

All this data falls under the scope of personal information as defined by the CCPA.

This example illustrates how a range of identifiable data, including digital footprints and inferred profiles, is considered personal information under the CCPA.

What is a CCPA Notice at Collection of Personal Information?

A CCPA Notice at Collection of Personal Information is a disclosure requirement mandated by the CCPA. This notice must be provided to consumers at or before the point of collecting their personal information. The notice should include:

  • Categories of Personal Information Collected: The notice must clearly list the categories of personal information that the business intends to collect.
  • Purpose of Collection: The business must specify the purposes for which the collected personal information will be used.
  • Information on Selling or Sharing: If the business sells or shares personal information, the notice must include this fact and provide information on how consumers can opt-out.
  • Link to Privacy Policy: The notice should include a link to the business’s privacy policy, where consumers can get more detailed information about data handling practices.

The CCPA Notice at Collection serves to inform consumers upfront about what personal information is being collected and why, enhancing transparency and giving consumers a chance to make informed decisions.

What Categories of Personal and Private Information Can be Gathered?

Under the CCPA, a wide range of personal and private information can be gathered. These categories include, but are not limited to:

  1. Identifiers: Such as a real name, alias, postal address, unique personal identifier, online identifier, internet protocol address, email address, account name, Social Security number, driver’s license number, passport number, or other similar identifiers.
  2. Characteristics of Protected Classifications: Including age, race, color, ancestry, national origin, citizenship, religion or creed, marital status, medical condition, physical or mental disability, sex (including gender, gender identity, gender expression, pregnancy or childbirth and related medical conditions), sexual orientation, veteran or military status, genetic information.
  3. Commercial Information: Including records of personal property, products or services purchased, obtained, or considered, or other purchasing or consuming histories or tendencies.
  4. Biometric Information: Data generated from physical characteristics or activity patterns used to extract a template or other identifier or identifying information, such as fingerprints, faceprints, and voiceprints.
  5. Internet or Other Electronic Network Activity Information: Such as browsing history, search history, and information regarding a consumer’s interaction with a website, application, or advertisement.
  6. Geolocation Data: Precise geographic location information about a particular individual or device.
  7. Audio, Electronic, Visual, Thermal, Olfactory, or Similar Information: Including images and audio, video or call recordings created in connection with a business’s activities.
  8. Professional or Employment-Related Information: Including current or past job history or performance evaluations.
  9. Education Information: Non-publicly available education information, like grades, transcripts, class lists, student schedules, student identification codes, student financial information, or student disciplinary records.
  10. Inferences Drawn from Personal Information: Creating a profile about a consumer reflecting their preferences, characteristics, psychological trends, predispositions, behavior, attitudes, intelligence, abilities, and aptitudes.

These categories highlight the breadth of information considered personal under the CCPA, emphasizing the need for businesses to be meticulous in their data collection and handling practices.

Rely on ZenGRC for CCPA Compliance

Relying on ZenGRC for CCPA compliance offers businesses a streamlined and efficient way to manage their privacy obligations. As a comprehensive governance, risk management, and compliance (GRC) solution, ZenGRC simplifies the complex process of adhering to the stringent requirements of the California Consumer Privacy Act (CCPA). It provides an intuitive platform for tracking and reporting on data protection practices, ensuring that all personal information is handled in compliance with CCPA regulations. With features like automated risk assessments and real-time compliance monitoring, ZenGRC helps businesses stay ahead of potential compliance issues. This proactive approach not only minimizes the risk of non-compliance but also instills confidence in customers that their personal data is being managed responsibly.

Are Public Companies Required to be Audited?

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Audits play a pivotal role in corporate governance, compliance, and finance. They are crucial tools to assure transparency, accountability, and trust in the public markets — and for publicly traded companies, the stakes are even higher. They are required to undergo annual audits of their financial statements and internal control, an exacting process that imposes a host of duties on the company in question.

This article unpacks the regulatory landscape surrounding public companies and their audit requirements. We’ll explore why audits are not just a legal formality but a fundamental aspect of corporate integrity and investor confidence. Whether you’re an investor, a corporate professional, or simply someone interested in the intricacies of corporate governance, this post will shed light on the importance of auditing in public companies and the effect audits have on the broader financial ecosystem.

Which type of companies are required to have an audit?

In the United States, publicly traded companies have had to undergo annual independent audits for decades. They aren’t the only organizations, however, who either need annual audits or can benefit from undertaking them. 

Publicly listed companies. Publicly traded companies are required by law in the United States and most other jurisdictions to undergo annual financial audits. This requirement is enforced to protect shareholders and the public, who rely on accurate financial information to make informed decisions.

Large private companies. While rules vary by country, large private companies, usually defined by a combination of their revenue, assets, and number of employees, often need to conduct annual audits. These audits provide assurance to investors, creditors, and other stakeholders about the accuracy of the company’s financial statements.

Nonprofit organizations. Many nonprofit organizations, especially those that receive a significant amount of public or government funding, are required to have annual audits. These audits are crucial for maintaining transparency and public trust in how these organizations utilize their funds.

Companies seeking investment. Startups and companies seeking investment from venture capitalists, banks, or other financial institutions may be required to undergo an audit to receive those investment dollars. Auditors verify the financial health and viability of the company, which is vital information for potential investors.

Companies with external debt. Companies that have taken on significant external debt may be required by their lenders to conduct regular audits. These audits assure lenders that the company is in a stable financial position to repay its debts.

Subsidiaries of public companies. Even if a subsidiary company is not publicly traded, if its parent company is, that subsidiary may still be required to undergo an audit. This assures the parent company’s consolidated financial statements, which include the subsidiary’s financials, are accurate.

Companies with shareholder agreements requiring audits. Some companies have shareholder agreements that mandate annual audits. These agreements are often put in place to provide shareholders with confidence in the financial statements and operations of the company.

Government contractors. Firms that contract with government agencies are often required to have regular audits. These audits ensure that taxpayer funds are being used appropriately and following the terms of the contract.

How often are publicly traded companies audited?

By law, the annual financial statements of public companies must be audited each year by independent auditors. These auditors are certified public accountants (CPAs) who examine the statements for conformity with U.S. Generally Accepted Accounting Principles (GAAP). 

A company’s management prepares the financial statements to inform investors and the public about the company’s financial position and the results of operations. The audit committee of the company’s board of directors then hires an independent auditing firm to examine the statements and other related disclosures. The audit committee oversees the auditors’ work and also monitors any disagreements between the auditors and company management regarding financial reporting.

The auditing team consists of accountants and other professionals under the leadership of senior CPAs who work at an accounting firm. Audit team members are chosen based on how their individual skills match the particular requirements of the company needing the audit. 

All CPA firms must be registered with the Public Company Accounting Oversight Board (PCAOB). Large companies typically work with one of the “Big 4” audit firms: PwC, Deloitte, KPMG, or Ernst & Young. Smaller companies are more likely to work with smaller audit firms. 

How does the audit happen?

The auditors examine a company’s accounting books, transaction records, and other relevant documents to determine whether the company has presented its financial statements fairly and those statements don’t contain any material misstatements. 

The auditors then prepare a written audit report containing an opinion on the company’s financial statements, and file it with the U.S. Securities and Exchange Commission (SEC). The audit report that’s on file with the SEC is available to investors and other interested parties. (Other organizations, such as nonprofits, might have their financial statements and audits filed with other agencies, such as a state attorney general or secretary of state.)

The main goal of the audit report is to give capital market participants, investors, and policymakers “reasonable assurance” — that is, assurance beyond the company’s own declarations — that they can rely on the financial statements for investment decisions and other purposes. 

Auditors also often evaluate the effectiveness of an organization’s internal controls over financial reporting (ICFR). Internal controls are procedures created by management to address the risk of misstatements and material errors in financial statements. Auditors can increase the confidence of investors by attesting that an organization’s internal controls are effective.

The audit requirements for private companies are different from those for public companies. Both public and private companies are subject to generally accepted accounting principles, although for different reasons. 

The SEC requires publicly traded companies to provide GAAP-compliant audited financial statements. Private companies may be subject to GAAP requirements to satisfy lenders, insurance companies, or certain classes of shareholders, but many private companies don’t issue audited financial statements. The main concern of private organizations is reducing taxes; consequently they often only prepare tax returns and statements that aren’t audited.

Choosing an independent auditor for your business

The choice of an auditor is a significant decision that can affect not just the financial transparency of a business but also its reputation and compliance with regulatory standards. Here are key considerations for businesses when selecting an independent auditor.

Reputation and credibility. Look for an auditing firm with a strong reputation for integrity and quality services. Check the firm’s track record, client reviews, and any industry recognitions or awards they might have received. A reputable auditor is likely to be more reliable and trustworthy.

Industry expertise. Choose an auditor with experience and expertise in your industry. Different industries have different accounting issues and regulatory requirements. An auditor familiar with your industry will be more adept at identifying potential issues and providing relevant insights.

Size and resources of the firm. Consider the size of the auditing firm and its resources. Larger firms may have more extensive resources and a wider range of expertise, but smaller firms could offer more personalized attention. Assess your company’s needs and choose a firm whose size aligns with those needs.

Audit team experience and qualifications. Evaluate the qualifications and experience of the specific audit team members who will be working with your company. Confirm that they have the necessary certifications (such as being CPAs), and relevant experience.

Communication and approachability. Good communication is crucial. The auditor should be approachable and willing to explain their findings in a clear, understandable manner. Regular communication and a transparent approach can greatly facilitate the audit process.

Independence and objectivity. Verify the auditor’s independence. They should have no financial or other relationships with your company that could impair their objectivity. Independence is critical for an unbiased audit.

Scope and methodology of the audit. Discuss the scope and methodology of the audit. Understand what areas of your financial statements will be examined and how the audit team will conduct its work. This will help you prepare for the audit and set appropriate expectations.

Cost of the audit. While cost should not be the only factor, it’s important to consider the fees charged by the auditor. Be sure the fees are reasonable and align with the market rate for similar audit services.

References and client feedback. Ask for references and feedback from other clients who have used the auditor’s services. Client experiences can provide valuable insights into the auditor’s working style and the quality of their services.

Regulatory compliance. Verify that the auditor is licensed and in good standing with regulatory bodies. This assures that the firm adheres to the highest standards of the auditing profession.

By carefully considering these factors, businesses can choose an independent auditor that not only meets your auditing needs, but also adds value through their expertise and insights. Remember, the right auditor is a partner to assure the financial health and regulatory compliance of your business.

Prepare for your next audit with reporting from ZenGRC

Preparing for an audit is no easy thing. ZenGRC’s comprehensive reporting tools can help you navigate that process more easily and efficiently.

ZenGRC offers a centralized platform that simplifies the gathering and organizing of the necessary documentation, smoothing the path to comply with auditing standards. Its intuitive dashboards provide real-time insights into your compliance status, helping you identify and address any gaps before the audit. 

With customizable reporting features, ZenGRC allows you to generate precise, detailed reports tailored to the specific requirements of your auditors. By leveraging ZenGRC’s capabilities, you can approach your next audit with confidence, backed by a robust, well-documented compliance framework.

This makes ZenGRC an ideal choice for organizations looking to enhance their compliance posture with minimal hassle and maximum confidence.

Schedule a demo today to see how ZenGRC can help you achieve “Zen-mode” compliance!

Network Segmentation: Definition and Best Practices

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2020 was not a good year for cybersecurity. In the first half of that year alone, ransomware (a special kind of malware) attacks increased by 715 percent from the prior year’s levels.

A global survey found that 57 percent of organizations experienced a phishing attack, up from 55 percent in 2019, while the average total data breach cost climbed to $3.86 million.

To mitigate the risks of such cyberattacks, enterprises need to do more. One tactic proven to help is implementing network segmentation practices.

What are “network segments,” and how can a segmented network improve cybersecurity? Today’s post answers those questions. We’ll also unpack five network segmentation best practices to help boost your enterprise network’s security.

What Is Network Segmentation?

Network segmentation divides an enterprise network into smaller segments or sub-networks with limited interconnectivity.

Segmenting networks gives administrators better control over network traffic as that traffic flows from one segment to the next and improves your ability to prevent unauthorized users from accessing the organization’s devices, applications, and data.

And if a data breach does happen — which, let’s not delude ourselves, can always occur — network segmentation assures that the breach only affects that targeted segment. The other network segments remain protected from further damage.

How Can Network Segmentation Improve Security?

In the enterprise network, firewalls and other protective mechanisms cannot permanently block or detect threats within the organization’s network. Segmentation can prevent more cyberattacks, reduce damage, and improve overall network performance.

One reason is that segmenting improves access control, so only authorized users with specific privileges can access each segment.

This means that even if an attacker does gain access to one segment, they won’t be able to access the rest of the network; the attacker can only move around within whatever segment the stolen access credentials allow. This helps to minimize damage and prevents the network from failing in its entirety.

By implementing network segmentation best practices, you also get better visibility into and control over network traffic so that you can minimize any threats to your systems — both external and internal.

Remember, securing the computer network from internal threats is now just as important as securing it from external threats. This is because the earlier “trust assumption” — where insiders were assumed to be trustworthy and not a threat — has eroded.

Perhaps the insiders have ill intent; they’re unwitting dupes in a criminal scheme; possibly, attackers have stolen their credentials to impersonate the insider. Regardless, the insider can be a source of data breaches just as much as an outsider.

Adopting Zero Trust Architecture (ZTA) is essential, and network segmentation is part of the ZTA approach. You can create a micro perimeter around your most critical assets to protect them from unauthorized users and bad actors.

Segmented architecture also helps to simplify firewall security policies. You can further reduce your attack surface by using a consolidated policy for subnet access control (as well as threat detection and mitigation).

Micro-segmentation (implemented through software-defined networking) can also allow you to enforce more granular security policies to meet your organization’s specific cyber-defense needs.

Segmenting reduces regulatory compliance costs by limiting the number of systems that fall within the scope of a compliance audit.

Other Benefits of Network Segmentation

In addition to strengthening your security posture, network segmentation provides other advantages that improve network operations and management.

Segmenting your network by department, function, or application allows you to optimize traffic flow based on usage patterns. This eliminates congestion and bottlenecks, ensuring critical applications get the required bandwidth and priority.

Additionally, network segmentation enhances troubleshooting capabilities. Issues can be isolated to a specific segment without impacting the rest of the network. You gain visibility into exactly where performance problems or faults are occurring.

Network segmentation enables you to scale parts of your infrastructure independently as needed. Traffic growth in one department won’t necessarily require upgrades for the whole network.

By taking a strategic approach to network segmentation that maps to your business functions, you gain security, flexibility, scalability, and manageability – critical pillars for the digital enterprise.

Main Goals of Network Segmentation

Network segmentation’s primary goal is to improve overall cybersecurity by preventing lateral movement of threats and prospective attackers within the network.

A breach in one portion of a classic flat network, where all devices and systems are part of a single domain, might provide attackers access to critical resources throughout the network infrastructure.

Network segmentation reduces this risk by erecting barriers between segments, limiting the attacker’s access to a specific zone during an attack.

Network Segmentation vs. Micro-Segmentation

Network segmentation and micro-segmentation are related strategic concepts for securing your infrastructure, but some key differences exist.

Network segmentation divides your network into subnetworks based on function, department, geography, or other logical separations. This creates security boundaries to restrict lateral movement and isolate malware and other threats infiltrating the internal network. Segmentation is typically enforced at the subnet level using Virtual Local Area Networks (VLANs), Access Control Lists (ACLs), firewalls, and security zones.

Micro-segmentation furthers this concept by enabling more granular isolations at the subnet level and even down to the individual workload, container, endpoint, or virtual machine. Rather than just traditional network gear, software-defined perimeters and Zero Trust Network Access (ZTNA) enforce secure boundaries between micro-segments.

Examples of Network Segmentation

Organizations can segment their corporate network environment in various ways to improve security and meet business needs. Here are three common examples:

  • Segment by Department: Dividing your network based on departments (finance, sales, HR, etc.) allows you to customize access and security controls based on data sensitivity and level of trust. For example, external guest access can be isolated from internal resources.
  • Segment Application Tiers: Grouping application components like web servers, databases, and APIs into dedicated tiers or security zones helps minimize impacts and vulnerabilities from threats targeting a specific part of the stack.
  • Isolate BYOD: Allowing personal and BYOD devices their network segment lets you enable access while limiting lateral connectivity to business-critical systems not intended for remote access. Distinct policies can be applied.

Network segmentation aligns access and security controls to trust levels, functionality, and data criticality. This provides in-depth defense against threats that infiltrate the internal network.

How Can You Segment a Network?

Network segmentation can be implemented as either logical or physical segmentation. Physical segmentation involves segmenting a more extensive network into smaller segments using physical or virtual firewalls.

Logical segmentation creates subnets with Virtual Local Area Networks (VLANs) or network addressing schemes. It requires no wiring or the physical movement of components, making it more flexible and automation-friendly.

Network segmentation can be done through firewall segmentation at specific network boundaries. The firewall provides visibility into network traffic and can be set to allow/block various kinds of traffic, applications, and users.

If your organization aims for PCI-DSS compliance, consider PCI DSS network segmentation to isolate and protect credit card data from other computing processes.

Eight Network Segmentation Best Practices

1. Understand who accesses what.

Proper network segmentation starts by first knowing who can access the network and who should access which parts of the network — and that might not always be the same group of people.

By defining access needs clearly, you can ensure no issues requiring a costly and time-consuming re-architecture of the segmentation process might arise later.

2. Avoid Under or Over-Segmentation.

One of the most essential network segmentation best practices is to create the correct number of segments to balance security with complexity.

Too many segments will make it harder to control and manage the network. Too few will weaken the network’s security profile.

3. Restrict and Control Third-Party Access.

Bad actors can attack your enterprise network or data center through third-party vendors or suppliers.

The risk of third-party data breaches is not only on the rise; it can also cost organizations about $370,000 more than if a third party was not involved. Restricting third-party access to your critical systems and sensitive data is essential.

Creating separate portals to serve each vendor will isolate and limit an attack, even if it happens.

4. Consolidate Similar Network Resources.

Combining similar network resources into individual databases is another network segmentation best practice to follow. With such a tactic, you can quickly implement information security controls and ensure that business-critical data remains isolated and protected.

5. Perform Network Audits.

Regular and comprehensive network audits, with risk assessments and penetration testing, are critical to avoiding bad actors trying to exploit your enterprise network in many ways.

By auditing the network, you can find exploitable gaps and take action to close them before a bad actor has a chance to slip in and cause damage. Audits will also reveal if your previous network segmentation plan needs to be updated.

6. Assess your Assets Value.

Organizations should inventory their assets and assign valuations before initiating network segmentation activities. Each asset, from Internet of Things (IoT) devices to databases, should be classified according to its relevance and data sensitivity.

Separating things of lesser and higher value while retaining a complete inventory of business assets facilitates the transition and execution of a network segmentation plan.

7. Implement Endpoint Protection Measure.

Hackers frequently target endpoint devices because they are frequently unprotected and lack sufficient safeguards. A single compromised device can provide hackers with access to the whole leading network.

Endpoint Detection And Response (EDR) technology helps enterprises add an extra layer of security by proactively monitoring Indications Of Attack (IOAs) and Indications Of Compromise (IOCs).

8. Follow the Principle of Least Privilege.

Once network segmentation is in place, each network should adhere to the zero-trust paradigm and the concept of least privilege. These practices entail restricting network access at every level, which demands authentication and verification from all parties within the network boundaries, both internal and external, before getting access to additional areas of the network.

Network administrators may immediately detect malicious actors or unauthorized parties attempting to breach the network using Zero Trust Architecture (ZTA). Only authorized users with the appropriate permissions can access the data on that network.

How ZenGRC Can Supplement Network Segmentation

The modern cyber threat landscape is teeming with bad actors looking for ways to attack your enterprise network. To stay ahead of them, you must take action today.

Protect your network, vulnerable devices, endpoints, and data with a robust network segmentation strategy. And get it right by adhering to this article’s network segmentation best practices.

You can strengthen your organization’s security posture, but this requires taking action — sooner rather than later.

Implementing a robust cybersecurity strategy can be daunting, mainly if your organization is responsible for adhering to cybersecurity compliance frameworks.

ZenGRC is a risk management and compliance solution that can supply compliance and cybersecurity teams with a centralized, integrated dashboard that identifies risk across your organization.

ZenGRC simplifies risk management and provides complete views of your control environments, easy access to your documentation at audit time, and continuous monitoring of your security stance over time.

To learn more about ZenGRC and how it can support your compliance and network security strategy, contact us now for a free demo.