A System of Record for Security: Everything You Need to Know

Security is a complex and constantly evolving challenge. With countless alerts, numerous isolated tools, and a variety of threats happening at once, it can seem overwhelming. Trying to handle everything manually or predicting the next threat is impractical.

To be an effective security leader, having a comprehensive system of record can help navigate these challenges. Security should be viewed as an ongoing process rather than a one-time solution, as no single tool can ensure complete safety. While tools, techniques, and tactics change daily, leveraging actionable intelligence from your security operations center can significantly enhance your organization’s security.

What is a System of Record?

A system of record (SOR) is a data management system or centralized database that acts as the authoritative source for a specific set of data or information. It stores, manages, and maintains data for particular domains such as customer information, financial transactions, or inventory levels.

The primary purpose of an SOR is to offer a unified view of data accessible by various applications, systems, and users within an organization. This ensures consistency, accuracy, and integrity of the data, providing all stakeholders with the same up-to-date information.

A system of record typically has numerous key characteristics:

Authority: The system of record (SOR) is the definitive source for the data it holds. All other systems or applications needing this data must access it from the SOR rather than keeping separate copies.
Integration: An SOR consolidates data from various sources, such as transactional databases, external data providers, or other systems. It serves as a unified platform for data collection, processing, and reporting.
Standardization: The SOR enforces standardized data formats, schemas, and definitions, ensuring consistency and clarity across all data.
Persistence: Data stored in an SOR is preserved long-term, maintaining a historical record of all changes and updates.
Security: Access to the SOR is strictly controlled with robust security measures to protect sensitive data from unauthorized access, modification, or breaches.
Scalability: An SOR is designed to handle large volumes of data and can scale with organizational growth without compromising performance or functionality.
Governance: Clear policies and procedures govern the SOR's management and maintenance, including data quality control, validation, and cleansing processes.
Auditability: The SOR keeps detailed audit trails of all transactions, facilitating easy tracking and monitoring of data changes, additions, and deletions.
Compliance: The SOR adheres to relevant regulatory requirements, industry standards, and organizational policies, ensuring data is handled and stored according to legal and ethical guidelines.
Interoperability: An SOR can seamlessly integrate with other systems, applications, and platforms via APIs or other data exchange mechanisms, enabling efficient data sharing and collaboration across the organization.

The importance of privacy and compliance in business

Privacy and compliance are essential in today's digital landscape, where data collection and processing are integral to nearly every industry. These elements are closely tied to data handling practices and are crucial for building trust with customers, employees, partners, and other stakeholders.

Respecting customer privacy and protecting their personal information fosters trust and enhances your business's reputation. A robust privacy policy shows your commitment to safeguarding sensitive data, leading to increased customer loyalty and advocacy. Privacy regulations like the GDPR in the EU, the CCPA in the US, and similar laws worldwide impose strict rules on data collection, storage, and processing. Compliance with these regulations helps avoid fines, penalties, reputational damage, and potential business loss.

Adhering to data protection regulations, industry standards, and sector-specific laws is crucial to avoid legal and financial repercussions. Non-compliance can result in data breaches, cyber-attacks, intellectual property theft, and brand damage. Maintaining compliance reduces these risks through proper safeguards, monitoring processes, and incident response plans. It also fosters trust among stakeholders, enabling stable partnerships, investments, and customer relationships. Compliance facilitates cross-border data transfers and trade, allowing businesses to expand globally without regulatory or legal concerns.

A strong compliance framework ensures tight data controls, leading to better data quality, reduced duplication, and more efficient processing. Well-managed data supports informed decision-making, cost savings, and competitive advantages. Additionally, compliance reflects a company's commitment to ethical practices and builds trust with customers, employees, and partners. A solid reputation based on compliance and privacy best practices contributes to long-term success and growth.

What are the steps to build a system of record for privacy and compliance?

Creating a system of record for privacy and compliance requires several steps to ensure organizations collect, store, and process personal data in a way that adheres to regulations and respects individuals' privacy rights.

Here are the steps involved in building such a system:

1) Define the Purpose and Scope

The initial step in building a system of record for privacy and compliance is to clearly define its purpose and scope. This involves specifying the types of personal data that will be collected, stored, and processed, along with the sources of this data, the reasons for collecting it, and who will have access to it. Additionally, the scope should cover the geographic locations where the data will be handled and any third-party processors or sub-processors involved.

To define the purpose and scope, organizations should consider:

Types of Personal Data: What kinds of personal data will be collected (e.g., names, email addresses, phone numbers, financial information)?
Data Sources: Where will the personal data come from (e.g., customer databases, employee records, website forms)?
Purpose: Why is the personal data being collected (e.g., marketing, sales, customer service, HR management)?
Access: Who will have access to the personal data (e.g., employees, contractors, third-party vendors)?
Geographic Locations: Where will the data be collected, stored, and processed (e.g., countries with specific data protection laws)?
Third-Party Processors: Which third-party processors or sub-processors may have access to the data (e.g., cloud storage providers, data analytics firms)?

After defining the purpose and scope, organizations can identify applicable regulations and develop a plan to implement privacy controls.

2) Identify Applicable Regulations

The second step is to identify all relevant privacy and security regulations that apply to the system of record. This could include regulations like GDPR, CCPA, HIPAA/HITECH, PCI DSS, and the NIST Cybersecurity Framework, as well as other industry-specific standards. Understanding the requirements of each regulation and their impact on data collection, storage, and processing is crucial.

To identify applicable regulations, organizations should consider:

Location: Where the organization and the personal data are located.
Type of Data: The types of personal data being collected, stored, and processed.
Industry: The industries or sectors involved in handling the personal data (e.g., healthcare, finance, retail).
Regulatory Bodies: Relevant regulatory bodies or authorities overseeing the organization's data handling practices.

After identifying the applicable regulations, organizations can perform a Data Protection Impact Assessment (DPIA) to assess privacy risks and evaluate the effectiveness of existing controls.

3) Conduct a Data Protection Impact Assessment (DPIA)

Conducting a Data Protection Impact Assessment (DPIA) helps organizations mitigate and identify potential privacy risks associated with the system of record. A DPIA involves evaluating the severity and likelihood of privacy breaches, assessing the effectiveness of existing controls, and recommending additional measures to minimize risk. This assessment should be documented and regularly updated to ensure ongoing compliance with evolving privacy regulations.

To conduct a DPIA, organizations should:

Identify High-Risk Processing Activities: Determine which personal data processing activities pose high privacy risks (e.g., large-scale processing of sensitive data, processing data from vulnerable populations).
Assess Privacy Breach Risks: Evaluate the likelihood and severity of potential privacy breaches resulting from these activities.
Evaluate Existing Controls: Assess the effectiveness of current controls and procedures for protecting personal data.
Recommend Additional Measures: Suggest further measures to reduce privacy risks, such as implementing encryption, access controls, or anonymization techniques.
Document and Update: Record the findings and recommendations of the DPIA and update them regularly to reflect any changes in the system of record or applicable regulations.

After completing the DPIA, organizations can design and implement privacy controls to address the identified risks.

4) Design and Implement Privacy Controls

Based on the DPIA findings, design and implement privacy controls to address identified risks. These controls may include technical measures such as access controls, encryption and pseudonymization, as well as organizational measures such as data protection procedures, policies and training programs. It is essential to involve stakeholders from various departments, including legal, IT and compliance, to ensure the controls are effective and practical.

When implementing and designing privacy controls, organizations should consider:

Specific Privacy Risks: Address the specific privacy risks identified in the DPIA.
Type of Data: Consider the types of personal data being collected, stored, and processed.
Data Sources: Identify the sources of personal data (e.g., customer databases, employee records).
Access: Determine who will have access to the personal data (e.g., employees, contractors, third-party vendors).
Standards and Best Practices: Follow applicable industry standards or best practices for protecting personal data.

Privacy controls should meet regulatory requirements while being practical to implement and maintain. Regular testing is necessary to ensure the controls remain effective in mitigating privacy risks.

5) Develop a Data Management Plan

A data management plan outlines how personal data will be stored, collected, deleted and processed within the system of record. It should detail data retention periods, backup and recovery processes, data subject rights and incident response plans. The plan must also cover how third-party processors will handle personal data and ensure compliance with regulations.

To develop a data management plan, organizations should consider:

Types of Data: The types of personal data being collected, stored, and processed.
Data Sources: The origins of personal data (e.g., customer databases, employee records).
Purpose: The reasons for collecting personal data (e.g., marketing, sales, customer service, HR management).
Access: The parties who will have access to the personal data (e.g., employees, contractors, third-party vendors).
Regulations and Standards: Any applicable regulations or industry standards for managing personal data.
Retention Periods: Data retention periods and schedules for deleting personal data.
Backup and Recovery: Procedures for backing up and restoring personal data.
Incident Response: Plans for responding to data breaches or other security incidents.
Data Subject Requests: Processes for handling data subject requests (e.g., access, correction, deletion).

The data management plan should be regularly updated and reviewed to reflect changes in the system of record or applicable regulations.

6) Establish Accountability and Governance Structure

Establishing a framework for accountability and governance guarantees that the record-keeping system is maintained according to relevant regulations and industry standards. This involves appointing a data protection officer (DPO) or equivalent, forming a data governance committee, defining roles and responsibilities for data handling, and developing policies and procedures for data management and security. Regular audits and assessments are crucial to maintain the effectiveness and compliance of the governance structure.

To establish an accountability and governance structure, organizations should consider:

Regulations and Standards: Applicable regulations and industry standards for data privacy and security.
Organizational Size and Complexity: The scale and complexity of the organization’s data processing activities.
Types of Data: The types of personal data being collected, stored, and processed.
Access: Parties with access to personal data (e.g., employees, contractors, third-party vendors).
Roles and Responsibilities: Defining roles and responsibilities for managing personal data and ensuring compliance.
Policies and Procedures: Developing policies and procedures for data management and security.
Training: Implementing training programs to educate personnel on data privacy and security.
Incident Response: Establishing incident response plans for data breaches or security incidents.
Audits and Assessments: Conducting regular audits and assessments to evaluate governance structure effectiveness.

By establishing a robust accountability and governance framework, organizations can ensure ongoing compliance with evolving privacy regulations and industry best practices.

7) Train Personnel and Communicate with Stakeholders

Training personnel and communicating with stakeholders are essential to ensure that everyone involved in the system of record understands their roles and responsibilities regarding privacy and compliance. Training programs should cover topics such as data protection principles, relevant regulations, security measures, and incident response procedures. Stakeholders should include employees, contractors, third-party vendors, and any other parties with access to personal data.

To effectively train personnel and communicate with stakeholders, organizations should consider:

Types of Data: The types of personal data being collected, stored, and processed.
Regulations and Standards: Applicable regulations and industry standards for data privacy and security.
Roles and Responsibilities: Clearly defining roles and responsibilities for managing personal data and ensuring compliance.
Policies and Procedures: Implementing comprehensive policies and procedures for data management and security.
Training Programs: Developing training programs to educate personnel about data privacy principles, security measures, and regulatory requirements.
Incident Response Plans: Establishing clear protocols for responding to data breaches or security incidents.
Evaluation: Regularly evaluating the effectiveness of training programs and communication strategies.

By training personnel and fostering communication with stakeholders, organizations can ensure that everyone understands their obligations regarding privacy and compliance. This proactive approach helps mitigate the risk of non-compliance and protects the organization from potential legal and reputational repercussions.

Building a system of record for privacy and compliance is a complex yet crucial task for businesses handling personal data. By following the steps outlined in this process, organizations can construct a robust SOR tailored to their requirements. This approach not only ensures regulatory compliance but also safeguards customer privacy effectively.