Data is now the most valuable resource in the world. However, unlike gold or oil, data moves across borders immediately. Incredible opportunities for growth and innovation result from this freedom. Additionally, it creates a complex web of security and legal issues.
Everywhere, governments are tightening their grip on the storage, processing, and transfer of digital information. Data sovereignty is based on this fact. The question for global organizations is now more than just where to store data for optimal performance. It concerns who has access to it and where you are permitted to store it in accordance with the law. Your company runs a significant risk if you ignore these questions. The first step in developing a resilient data strategy is to comprehend them.
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How does data sovereignty work?
The idea that digital data is subject to the laws of the country in which it is stored is known as data sovereignty. The GDPR and other German laws must be adhered to if customer data is stored on a server in Germany. The same data is subject to US law if it moves to a server in the United States. In theory, this sounds simple. It is incredibly complicated in practice. Because of cloud computing, your data may be dispersed simultaneously across multiple jurisdictions. Servers in three nations could be affected by a single transaction. CIOs and data architects face a minefield of compliance issues as a result.
The geography of geopolitics
Digital nationalism is gaining steam. Countries want to safeguard their national interests and maintain the privacy of their citizens. Data localization laws have increased as a result of this. Certain kinds of data must be created and stored within national borders in accordance with these laws.
Think about the landscape:
- Europe: The General Data Protection Regulation (GDPR) set the global standard for privacy, and subsequent regulations like DORA and NIS2 begin to lay the groundwork for sovereignty. To ensure European digital sovereignty, initiatives like GAIA-X and the Sovereign Cloud Framework are currently developing a secure, federated data infrastructure.
- Asia-Pacific: strict local storage for various data categories is required by a variety of regulations in China, India, and Vietnam.
- North America: New state-level privacy acts are adding layers of complexity, whereas the United States takes a more sectoral approach.
A “one size fits all” cloud strategy is no longer viable because of the regulatory patchwork.You need a nuanced strategy that doesn’t slow down global operations and respects local laws.
The difficulties you face
There are three main obstacles to overcome in this environment.
- Complexity of compliance
It takes a full-time job to keep up with new laws. In the future, a compliant architecture might be illegal. Noncompliance comes at a high price, from significant fines to a complete loss of customer trust.
- Operational inefficiency
Localization of data can result in silos. Collaboration suffers when your German team is unable to access data stored in Japan. Costs rise and decision-making slows down when multiple regions’ disparate infrastructure is managed.
- Security vulnerabilities
More attack surfaces typically mean more silos. It is difficult to maintain uniform security policies across a dispersed data landscape. You run the risk of leaving gaps that can be used by bad actors.
Finding the Right Balance
The objective is not merely to avoid fines. The objective is to maintain data security and compliance while unlocking the value of your data. Security and control are the two main control planes of sovereignty; tightening these often prevents innovation. Therefore, striking a balance is crucial.
Security
You lose sovereignty if your data are no longer secure. No matter where your data is stored, it must be protected from unauthorized access. Strong encryption and stringent access controls are required for this. You need to be able to monitor threats from a single window across your entire hybrid cloud estate.
Control
You lose your sovereignty if you lose control of your data. You must always know exactly where your data is. If the rules change, it needs to be easy to move. Here, a significant risk is vendor lock-in. You lose sovereignty if your cloud provider decides where your data is stored. Depending on the specific legal requirements, you need the flexibility to store data on-premises, in a private cloud, or in a public cloud.
Innovation
Compliance ought not to be a hindrance. In order to create applications and generate insights, your data teams need access to datasets. You can strictly regulate data with a reliable data fabric while still making it accessible to applications and individuals who require it.
Steps for leaders to take
How do you maintain this equilibrium? To take charge of your data sovereignty strategy, follow these steps.
Perform a data landscape audit
What you can’t see, you can’t control. Draw a precise map of the data you have, including where it is stored and how it moves between regions. Determine which datasets contain intellectual property or sensitive personal information.
Sort the data by their sensitivity
Different kinds of data require different levels of security. Health records and public marketing data have different sovereignty requirements. Different classification tiers make it possible to use the right controls without spending too much.
Adopt a multicloud hybrid strategy
It’s risky to rely on a single public cloud provider for everything. You have options with a hybrid model. You can use public cloud resources for less important workloads while keeping highly sensitive sovereign data in a local private cloud. Implement automation based on policies.
Compliance by hand is prone to error
Make use of tools that let you set policies once and then automatically enforce them. Set a rule, for instance, that data marked “GDPR” cannot be transferred outside the EU. These guidelines are always followed by automation.
Make portability a priority
Make sure that your data isn’t stuck in a format that’s proprietary. Workloads can be moved seamlessly between cloud and on-premise environments by making use of open standards and technologies. You can use this portability as protection against changes in regulations.
The next steps Data sovereignty will not be lost
Nations will continue to assert control over their data as digital economies expand. This is a change that will never go away in the global business landscape. Leaders who view this as merely a checkbox for compliance will have trouble. Leaders who see it as an opportunity to create a data architecture that is more reliable, transparent, and robust will succeed. You can ensure the success of your business in the future by taking control of your data now. There is no need to choose between adaptability and compliance. You can have both with the right strategy and technology partners. Create a data network that spans the globe while still adhering to local boundaries. That is how you transform a difficult regulatory issue into a significant competitive advantage. Are you ready to control your data? To learn more, take a look at our Data Sovereignty solutions.