To collect and process consumers’ sensitive data to fulfill both day-to-day and long-term business needs, companies must implement a data retention policy that complies with and enforces retention parameters set forth by federal and international data privacy laws.
What is Data Retention?
Data retention refers to the storing and use of data for a set period, also known as a data retention period. These data retention periods differ for every organization based on the type of data they store, the legislation governing their operations, and their business goals. The aim is to set a retention period that allows you to extract as much value as possible from your data while keeping up with regulations and the latest security threats.
What is a Data Retention Policy?
A company’s data retention policy outlines the purpose of collecting sensitive data, how that data will be processed and used for business, how long it must be retained, and how it will be disposed of when it’s no longer of use, per regulation requirements.
In addition to maintaining regulatory compliance, it keeps storage repositories clean, organized, and free of outdated information that would otherwise be a threat to data security. You’ll save money on storage and increase efficiency when it comes to locating data, all while protecting your consumers’ sensitive information with a retention policy in place.
Why is it important?
A data retention policy is part of an organization’s overall data management strategy. A policy is important because data can pile up dramatically, so it’s crucial to define how long an organization must hold on to specific data. An organization should only retain data for as long as it’s needed, whether that’s six months or six years. Retaining data longer than necessary takes up unnecessary storage space and costs more than needed.
4 Benefits of a Data Retention Policy
In addition to compliance, a data retention policy can help your business improve the way it manages information and responds to security threats. Here are just a few benefits:
- Cleaner, more accessible data: Data retention policies include provisions for the regular disposal of outdated or duplicated records. Cleaner data is easier to search for and creates less confusion for employees.
- Cost reduction: Done right, setting policies for data retention and disposal can reduce storage costs.
- Consolidated document storage: The shift to digital business models has left many companies at a crossroads between paper and digital document storage. Your data retention policy will account for this duality so you can effectively manage data in all its forms.
- Improved disaster recovery: In a world of relentless security threats, especially those targeting email, an outage or disaster can come at any time. Include provisions for backup and recovery in your data retention policy to protect mission-critical information and bounce back quickly.
The policy should clearly state the purposes for collecting and storing sensitive data, which includes payment card information, healthcare records, or other personally identifiable information (PII). Many companies collect multiple forms of sensitive data, and thus they’re subject to multiple data privacy regulations.
Based on the data it collects, a company must list those regulations, and more specifically, their retention requirements. This can include the retention schedule, security measures in place to protect the data while it’s retained, instructions for destruction after the retention period has passed, and actions the company takes when it comes to policy enforcement, upholding compliance, and responding to a data breach.
A common breach response plan involves restoring data from backups, and a data retention policy must outline guidelines for these as well, namely the frequency at which they occur and how they’ve been retained. Because a backup involves copying your sensitive data to a secondary storage location in case a breach modifies it or it’s lost entirely, the legal regulations still apply. If there’s a risk of data loss – and there always is nowadays – your data’s level of sensitivity will influence your backup cadence, which can range from daily to yearly. Daily and weekly backups should be retained for a much shorter period than monthly or yearly backups, but whatever you decide upon, it must be documented in your policy.
The Bottom Line
A data retention policy is more than a housekeeping tool. It is central to ensuring your data, employee communications, and storage processes are accessible, compliant, and secure.