Due to the increase in data protection laws and complex industry-specific regulations, it’s never been as important as it is now to keep on top of compliance. Lawmakers and regulators are not holding back when it comes to imposing fines on organisations that are unable to align their compliance and cybersecurity programs.
By establishing a consistent baseline of minimum security requirements, regulatory compliance helps improve an organisation’s overall security posture. A compliance solution capable of continuously monitoring and assessing an organisation’s compliance posture is key to keeping on top of laws and regulations relevant to your business.
With the above in mind, let’s take a closer look at the role of compliance in cybersecurity.
What is Compliance in Cybersecurity?
Cybersecurity compliance is a risk management technique firmly rooted in IT and administrational procedures. Cybersecurity regulatory compliance is based on pre-defined procedures and collectively accepted controls and security measures for enhanced data confidentiality. Cybersecurity compliance creates a unformed risk management approach that syncs with the latest laws and regulations. The primary role of cybersecurity compliance is to meet data protection and management requirements. Basically, cybersecurity regulations are industry standards created through compliance systems in cyberspace to meet regulatory laws and authorities related to your business.
Compliance guides organisations on the protocols that minimize the chances of data breaches and steers toward using cybersecurity best practices. When following compliance procedures, businesses are also provided with the action plan they need to follow when faced with a costly data breach. Cybersecurity compliance helps companies maximize their system’s resilience and reliability, alongside assessment processes and the continuous monitoring of devices and networks. Finally, compliance always ensures that your organisation is in coherence with regulatory cybersecurity compliance requirements.
Why is Compliance Important for Cybersecurity?
Compliance is important for cybersecurity in order to protect sensitive data within a business, organisation, entity, or government agency. Compliance with standards and regulations helps to ensure that a business is taking the necessary steps to protect sensitive information, such as financial information and personal data.
Compliance is also important for cybersecurity because the penalties imposed on businesses for non-compliance can be severe. Regulatory compliance is particularly important for organisations in the healthcare or financial sectors because of the huge amounts of highly sensitive data they hold on their patients or customers.
Types of Data Subject to Cybersecurity Compliance
Each sector has its own set of regulatory standards and compliance to follow with specific provisions for privacy and security. Some overarching regulations will apply to multiple industries. Compliance regulations also change from one country to the next and sometimes within the same country, like in the United States from state to state. Let’s take a look at some of the industries and the types of data subject to cybersecurity compliance:
Healthcare data compliance
The penalties for non-compliance with HIPAA regulations include civil monetary penalties ranging from US$100 to US$50,000 per violation, depending on the level of culpability. Criminal penalties can also be imposed for intentional violations, leading to fines and potential imprisonment.
Financial data compliance
For the financial sector, PCI DSS compliance is a complicated issue that any organisation that manages cardholder data should be well-versed in. If you are breaking regulations, you may face significant PCI compliance penalties that can significantly impact your company’s overall financial health and well-being.
The most recent Digital Operational Resilience Act (DORA) affects financial entities operating in the EU and will apply from 2025.
Europe-wide data compliance
GDPR fines are designed to make non-compliance a costly mistake for both large and small businesses. The GDPR states explicitly that some violations are more severe than others. The less severe infringements could result in a fine of up to €10 million, or 2% of the firm’s worldwide annual revenue from the preceding financial year, whichever amount is higher. The more serious infringements go against the very principles of the right to privacy and the right to be forgotten that are at the heart of the GDPR. These types of infringements could result in a fine of up to €20 million, or 4% of the firm’s worldwide annual revenue from the preceding financial year, whichever amount is higher.
United States data compliance
The California Consumer Privacy Act (CCPA) takes a different approach to how it determines penalties. There is no cap for a penalty, but there is a cap for each violation. Depending on the number of people affected and other circumstances, that amount can grow and really hit the business hard. CCPA penalties have an upper cap of $7,500 per intentional violation or $2,500 per non-intentional violation. Laws and regulations can also vary from state to state.
Defence data compliance
There are strict regulations in the defence sector. A data breach could lead to the disclosure of national or state secrets. The Cybersecurity Maturity Model Certification (CMMC) governs the Defence Industrial Base (DIB) in the United States. In Australia, the Defence Industry Security Program (DISP) assists entities in meeting security compliance when working on defence contracts, projects, and tenders.
However, the above-mentioned penalties are not the only reasons stakeholders pursue effective compliance management. The main benefit of compliance is the improvements seen in the overall cybersecurity posture of a business. Cybersecurity compliance activities also ensure that your business meets the minimum benchmarks for cyber resilience and meets the requirements necessary to keep you on the top of your game.
How does Compliance Ensure Cyber Safety?
Compliance ensures cyber safety by enabling organisations to analyse risks, put in place a system to protect data, and an action plan to follow in case of a breach. Below are the top reasons why compliance is so important from a cybersecurity perspective:
Following regulatory rules and regulations demonstrates that your business cares about its customers and wants to protect their sensitive data. It encourages trust.
Improves security posture
Compliance helps improve an organisation’s overall cybersecurity posture by providing a baseline of minimum security requirements.
Greater cybersecurity measures mean data breaches are less likely to happen. Not only does this lower the costs should any breach occur but also instils a sense of confidence in stakeholders and the public regarding your organisation.
Improved security helps to increase control over the company’s IT infrastructure. Not only can this help to prevent data loss or file corruption but reduces the amount of time spent fighting cyberattacks.
Get in Touch and See How RiskXchange Plays a Role in your Cybersecurity Compliance
A compliance solution capable of continuously monitoring and assessing an organisation’s compliance posture is key to staying on top of the latest rules and regulations. RiskXchange offers the means for your business to remain compliant in an ever evolving digital world with the following:
Reduce the Risk of Regulatory Penalties
A lot can happen between manual periodic point-in-time compliance assessments. RiskXchange’s cyber risk ratings and smart assessments are continuously updated, so you can ensure that your organisation maintains compliance between audits.
Enhance Vendor Security Practices
Most organisations struggle with establishing effective vendor risk management practices because they deal with a vast ecosystem of vendors who must meet compliance standards. RiskXchange’s compliance solution makes it easy to streamline the compliance monitoring process for all your vendors.
Automate Your Compliance Monitoring
As human error accounts for roughly 95% of cybersecurity incidents, the need for automation of compliance monitoring has never been so important. Automation not only narrows the room for human error but reduces the time spent to complete mapping the contents to well-known frameworks and standards.
Build Trust Among Your Stakeholders
You build trust among your stakeholders when you avoid the legal risks of a non-compliance breach or reduce the likelihood of a cyberattack. Complying with PCI, HIPAA, and ISO regulations also empower your organisation with a certification, proving that your compliance and vendor security practices are up-to-date and trustworthy.
Prevent Access to Sensitive Data
Gain comprehensive continuous visibility of your digital footprint to identify and remediate any security vulnerabilities or issues before your customers’ personal or financial data is compromised by attackers.
Mobilise Your Collective Workforce to Practise Risk Management
Hackers can infiltrate network infrastructure and disrupt your operations if one of your vendors’ team members opens the wrong email and clicks the malicious link. Compliance monitoring can help you mobilise your workforce and vendors to enforce security more effectively.
Cybersecurity Compliance Frequently Asked Questions
Why is cybersecurity compliance important?
Cybersecurity compliance is important because it helps to ensure that an organisation is taking the right steps to protect sensitive information, such as financial information and personal data of its customers.
What are the cybersecurity compliance standards?
Cybersecurity compliance means adhering to regulatory requirements and standards set forth by an agency, law group or authority. Businesses must achieve compliance by establishing risk-based controls that protect the confidentiality, integrity, and availability (CIA triad) of information.
Get in touch with RiskXchange to find out more about the role of compliance in cybersecurity.