Top 5 Reasons Every Company in Europe Should Do a GDPR Audit

We are now a little more than two years into the implementation of the General Data Protection Regulation (GDPR) in Europe. Improving on previous legislation that hadn’t changed much since the 1990s, the GDPR clarified the responsibilities of organisations that handle customer data as well as the rights of customers themselves.

Despite an official report suggesting that the GDPR has already met most of its goals, too many companies are still unsure of their own compliance. Some are not even aware that compliance is necessary. That is where a GDPR audit comes into play. Every company that does business in Europe should have an audit done, at a bare minimum.

An IT firm specialising in GDPR audit consultancy can do the job and offer solid recommendations for moving forward. If your company does business in Europe and has not yet conducted an audit, consider the following five reasons to rectify the situation:

1. The GDPR Is Not Europe-Exclusive

One of the most misunderstood aspects of the GDPR is that it applies only to businesses based in Europe. Nothing could be further from the truth. It applies to any and all organisations that operate within the EU and the European Economic Area, regardless of whether or not they have physical offices in Europe.

That means any organisation that collects and maintains data from European users is subject to the regulation. Any company that sells products or services to Europeans must comply. Enforcement may be sketchy outside of the EU, but the regulations still apply.

2. Compliance Gaps Might Exist

It goes without saying that organisations failing to take any action are most likely not in compliance with all of the GDPR’s provisions. But what about those organisations that have attempted to get on board? Gaps might still exist in their compliance efforts. A GDPR audit is designed to identify such gaps.

Understand that as of December 2018, European companies were still not confident in their ability to comply. Moreover, a significant number were convinced that full compliance is not possible. Questions remain as to whether or not data handlers can truly meet all of their legal obligations.

The only way to know is through an audit. In fact, regular audits are even better than a one-off audit. Regular audits keep organisations abreast of where they are with the GDPR at any point in time. Regular audits allow organisations to identify weak spots and correct them before these become major problems.

3. The Cost of Non-Compliance Is High

Legislators built enforcement efforts into the GDPR in order to ensure compliance across the board. Suffice to say that the cost of non-compliance is high. Organisations are given an initial warning upon the first discovery of non-compliance. A second complaint results in an official reprimand.

Organisations should never allow themselves to get past that reprimand. If they do, however, a third complaint could result in the suspension of an organisation’s right to collect and process data. In other words, government authorities could force a company to cease all operations in which customer data is used.

The last enforcement tool is also the most severe: financial penalties. Organisations can be fined up to €20 million or 4% of their annual global turnover. Regulators were slow to assess fines during the first year of implementation, but that has since changed.

4. The Other Options Are Not Palatable

It should be noted that some companies affected by the GDPR have chosen to take an alternative route. Rather than undergoing an audit and making the necessary changes, two other options quickly emerged after implementation of the law in May 2018:

  • Dumping All Data – Some organisations simply dumped all of their data and started over from scratch. Of course, this was only after ensuring that they could maintain compliance once they began collecting and processing data again.
  • Cutting Off Europe – Other organisations simply decided to stop operating in Europe. For example, more than 1,000 US-based news organisations blocked access to their sites in the EU rather than take the necessary steps to comply.

Neither option is all that palatable. Dumping your data and starting over alienates customers and requires a company to rebuild its entire audience from scratch. Such a strategy can do more harm than good. Cutting off all of Europe isn’t much better, as it reduces an organisation’s audience considerably.

5. The Rest of the World Will Follow

Finally, the perceived success of the GDPR has already led to governments in other parts of the world considering similar legislation. It is expected that the rest of the world will follow the EU at some point. That being the case, organisations are eventually going to have to comply one way or another. They might just as well assure compliance now before things get any more complicated.

Experts and pundits may argue over the perceived benefits of the GDPR for years to come. That does not change the fact that the regulation is now the law of the land in Europe. If your company operates in Europe and has not yet conducted a GDPR audit, now is as good a time as any to change that.

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