Despite advancements in cybersecurity, 2022 remained a notable year for data breaches. According to studies, the United States reported over 1800 cyber crimes affecting 422 million individuals. What’s more, Ernst & Young’s survey has found that 64% of interviewed board directors consider cybersecurity their top priority for 2023.
Obviously, at some point, businesses lack solid digital defenses. But the question stands — how can they protect their sensitive information and save themselves from penalties and significant financial losses?
A large amount of data breaches occur due to human error and outdated digital security systems. Luckily, businesses can minimize both threats by employing modern-day data management solutions like digital data room software.
Digital or virtual data rooms (VDRs) are online, cloud-based document management solutions particularly designed to facilitate data-sensitive transactions like M&A, biotech licensing, initial public offerings, and strategic corporate partnerships.
Dataroom software has been serving the financial sector since the early 2000s, and its security mechanisms have immensely improved with time. The best thing about virtual data room security is that it has multiple layers which provide maximum protection at almost every single step.
That said, virtual data room services not only protect the platform from unauthorized entrants but shield your data from internal threats as well. What’s more, even the communication that takes place in VDRs is mostly end-to-end encrypted and protected. Read more on virtual data room security further.
VDRs have grown from basic deal facilitation platforms to comprehensive business solutions that every business type can use for complex deal management and safe communication. “It has only happened due to revolutionary digital security features introduced by data room vendors over time,” says Angleo Dean, CEO of https://datarooms.org/ — an expert community conducting independent reviews and comparisons of data room solutions. You’re welcome to read more about globally serving data room vendors and data room providers’ reviews here.
Data room security has gone from basic to highly advanced in two decades. Following are the important VDR security features for data management and dealmaking.
To start with, every reliable virtual data room has (and must have) the following security certifications:
- ISO 27001/27081. ISO is a global regulatory authority accepted in almost all parts of the world. ISO 27001 and ISO 27081 deal with digital data protection and management standards.
- FINRA. It is an independent regulatory body that protects investors and regulates brokerage firms and other similar financial institutions in the United States. Any data room vendor operating in the American financial sector must be FINRA-certified.
- SOC2. It regulates the management of financial documents and defines the best and the latest methodologies to verify the availability, security, and privacy of virtual data rooms.
The variety of features to ensure general data room security depends on the particular vendor. Some of the most common are described below.
This feature keeps unauthorized users away from your VDR. This is because a user is required to go through two different identification phases to get access to the VDR.
Some vendors go one step ahead and require users to complete more than two identity confirmation steps before accessing the data room.
Data rooms mostly allow the administration to remove any device at any time without giving a warning or notification. The feature is useful if you believe that a certain device connected to your VDR has been stolen or lost. You can also delete the VDR data from the device.
Audit logs are comprehensive reports on everything happening in your dataroom software. It may include log-in or log-out times, documents accessed/opened/edited, and other activities performed by the users.
Document security features are one of the things that make virtual data rooms stand out from traditional cloud storage solutions when it comes to security measures. Below are some of the most common features.
You can easily and quickly redact any image, document, or text stored in your virtual data room. It means you can literally hide certain parts of the text by blackening them out. This ensures that all PII (personally identifiable information) is fully protected.
Digital or dynamic watermarks ensure that the watermark you have embedded in your document appears on the top when someone views, edits, or prints that document. Custom watermarks also track the IP address, name, date, and the changes made in the file.
It is currently the highest data encryption standard available in the world right now. You can encrypt the document and the content inside it separately. Such strong encryption is often used by militaries and investment banks.
It is one of the most remarkable features you will find in the data room that ensures the protection of your sensitive files against unsolicited document viewing. Once you enable the restricted viewing mode, users cannot see the content covered with a barred screen.
Virtual data rooms have emerged as a reliable solution for secure data protection and management around the globe. They are run or hosted by certified service providers and apply multiple layers of security to safeguard your secretive documents.
Last but not least, data rooms offer bank-grade security features like two-step verification, remote purge, audit logs, redaction, fence view, and more. Top-notch protection and compliance are what make virtual data rooms an irreplaceable tool on the market.
It has been a long time since I joined Research Snipers. Though I have been working as a part-time tech-news writer, it feels good to be part of the team. Besides that, I am building a finance-based blog, working as a freelance content writer/blogger, and a video editor.