Why Data Privacy Officer (DPO) is a business-critical role

Artificial intelligence (AI) and the online world have never been more complex or advanced than they are in 2024. Today, data is one of your business’s most valuable assets. However, the rapid growth in data collection means there are always new hoops to jump through. 

Recently, Hanover hosted a luncheon in partnership with Canopius to bring together women in cyber. One of our guest speakers, Annmarie Giblin from Norton Rose Fulbright, discussed the new categories of protected data that are rising in response to AI. 

It became clear during our discussions that with regulations tightening, the data landscape changing, and consumer trust withering, the role of a Data Privacy Officer (DPO) has never been more essential. 

In this article, I’ll explore why DPO is a business-critical role, dissecting its key responsibilities and how DOPs safeguard the trust of customers and stakeholders.

Understanding the data landscape

As digitization increases, the volume of data processed by businesses is skyrocketing. The volume of data created, captured and consumed worldwide has more than doubled since 2020, reaching 147 zettabytes in 2024—one zettabyte equivalent to a billion trillion bytes.

This data flows through organizations like a digital circulatory system and encompasses everything from personal information to financial records. If it isn’t handled correctly, businesses and individuals alike are at great risk, especially in a world where cyber threats loom large.

While there are three main types of regulated data (health, financial and consumer data), the rise of AI is creating new classes and subcategories, like biometric data. To keep satisfying regulatory requirements, organizations need to keep up with these developments. 

The evolution of data privacy

With high-profile data breaches making headlines and regulatory bodies imposing hefty fines for non-compliance, your organization can’t afford to overlook the importance of data privacy. 

Governments worldwide have responded to growing privacy concerns with new regulations aimed at safeguarding individuals' data rights. Examples include the European Union's General Data Protection Regulation (GDPR), California's Consumer Privacy Act (CCPA) and Brazil's General Data Protection Law (LGPD).

Most recently, on February 28, 2024, The White House issued Executive Order (EO) 13873, which seeks to prevent certain countries from accessing Americans’ sensitive personal and government data.

With new regulations constantly cropping up, unprepared organizations could be at risk of non-compliance. When speaking with Annmarie about this issue, she told me, “With AI and IoT, there are mountains of new data that are being collected and processed. These impact many legal obligations and could leave organizations feeling blindsided. A good example is how this boom of information means that previously unprotected data types will likely become mandatory to protect in the near future. This could include anything from photographs to search data—but whatever it is, businesses must be able to keep up.”

In this ever-changing regulatory minefield, the DPO has become a cardinal role, overseeing organizations’ data privacy efforts and guiding them toward compliance and accountability.

Understanding the role of a DPO

At its core, the role of a DPO is to ensure that an organization's data-handling practices comply with relevant laws and regulations. This involves:

• Developing and implementing policies
• Conducting risk assessments 
• Monitoring compliance across all aspects of data processing

Your DPO also serves as a point of contact for regulators and data subjects, handling inquiries and facilitating communication regarding privacy matters. With that in mind, there are six key things a DPO does that make them business-critical.

1. Identifying data points

One of your DPO’s key responsibilities is to identify and classify the various data points within an organization's ecosystem. This entails conducting comprehensive data audits to map out the flow of information across different departments and systems.

By understanding what data is collected, how it’s processed, and where it’s stored, a DPO can assess potential vulnerabilities and implement appropriate measures.

2. Managing stored data

Effective data management is essential for maintaining privacy and security. But with new rules and regulations occurring all the time, it can be difficult to manage this stored data.

Your DPO ensures that data is handled in compliance with all current regulatory requirements. This includes implementing robust encryption measures, access controls and data retention policies to mitigate the risk of unauthorized access or data breaches. 

Additionally, a DPO oversees data lifecycle management, ensuring that data is handled properly at every stage, from creation to deletion. Not only does this maintain data quality, it also improves processes and efficiency.

3. Ensuring compliance

Compliance with data protection regulations is non-negotiable in 2024. Your DPO acts as a conduit between your organization and any regulatory authorities, ensuring that all requirements are met and that any breaches or incidents are promptly reported.

This involves staying up-to-date on regulatory developments, conducting regular audits and carrying out measures to address any compliance gaps. By staying abreast of evolving regulations and industry standards, your DPO helps you navigate the complex terrain of data privacy.

4. Implementing privacy by design

Privacy by Design is the principle that privacy should, by default, be seamlessly integrated into technology, products and services. It advocates that protecting customer data is as fundamental as the functionality of the product itself. 

A DPO maintains Privacy by Design by integrating privacy considerations into every stage of a product’s or service’s lifecycle. This involves:

Collaborating with cross-functional teams to identify potential privacy risks

Putting privacy-enhancing measures and controls in place from the get-go

Ensuring that data protection principles are fundamental aspects of all systems and processes

5. Fostering a culture of data privacy 

Beyond regulatory compliance, a DPO is pivotal to fostering a culture of data privacy within organizations. The latter is as important as the former because people are your first line of defense. 

Alarmingly, 82% of data breaches involve human error, like clicking on a phishing link. If your employees aren’t aware, it won’t matter how many regulations you follow. 

By raising awareness among employees about the importance of safeguarding sensitive information, DPOs encourage privacy-conscious behavior and instill a mindset of accountability and responsibility across the entire organization.

6. Building trust and reputation

It’s important to recognize that as data collection is escalating, the trust people have in businesses is eroding. 81% of Americans say that the risks they face from companies collecting data far outweigh the benefits, and a further 79% are concerned about how these companies are using their data. 

Building trust with consumers is crucial to assuaging their fears. Enter your DPO, skilled at preserving the reputation and integrity of your organization. By helping you demonstrate a commitment to transparency and data privacy, a DPO enhances your ability to gain customer trust.

In turn, this gives you a competitive edge. According to McKinsey, organizations that build digital trust outperform ones that don’t, being more likely to see a 10% annual growth rate. Additionally, 40% of consumers have stopped buying from a business after learning it had poor data privacy, once again highlighting the importance of a DPO’s work.

A final thought

In 2024’s digital economy, there’s no getting away from data-driven innovation and the new regulatory requirements it precipitates.

Rather than facing this ever-changing landscape alone, businesses must recognize the strategic importance of Data Privacy Officers and invest accordingly to mitigate risks and boost opportunities.

If you’re looking to hire top DPO talent or pursue a DPO role, I'm happy to help. I specialize in placing mid to senior-level talent insurance and risk professionals into roles within various organizations, and I've had the pleasure of connecting several successful clients with outstanding candidates who find their homes in them. 

Contact the hanover team and let’s set up a time to chat about your needs.