Data privacy compliance: Benefits and best practices

Data protection regulations like the European Union’s General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA)/California Privacy Rights Act (CPRA) are reshaping how organizations handle personal data. As more countries introduce similar laws, organizations — especially those doing business internationally — must navigate complex compliance requirements that differ across jurisdictions.  

At the same time, consumer awareness of data privacy continues to grow, with increasing concern over how personal data is collected, shared, and used. Five years ago, 71 percent of consumers indicated that they would end relationships with companies that share their sensitive information without consent. 

In 2023, Cisco reported that 76 percent of consumers avoid purchasing from organizations that they don’t trust to handle their data, while 81 percent consider an organization’s data handling practices a reflection of how it values its customers.

Failing to meet legal and consumer expectations can cause significant damage to organizations. Data privacy compliance should be a primary focus for companies looking to build trust while meeting the growing legal requirements for personal data privacy and protection.

What is data privacy compliance?

Data privacy compliance refers to the measures and practices organizations adopt to manage personal data in line with privacy regulations. It involves developing and implementing policies, procedures, and technological safeguards to collect, process, and store personal data in a manner that respects individuals’ privacy rights and aligns with legal requirements.

Any organization that processes personal data — whether for transactions, marketing, or analytics — may be subject to data privacy laws. Compliance helps mitigate the risk of unauthorized access, increases transparency, and reduces the likelihood of legal penalties. It also helps demonstrate a commitment to handling personal information responsibly.

Data privacy compliance vs. data security compliance

Data privacy compliance and data security compliance address different responsibilities associated with protecting personal data. Data privacy compliance focuses on meeting all legal and regulatory requirements for handling data across its lifecycle. It includes transparency with notifications, data sharing, and user rights obligations.

Data security compliance focuses specifically on protecting data from breaches, cyber threats, and unauthorized access. It involves implementing technical safeguards such as encryption, access controls, and monitoring systems to prevent unauthorized use or exposure.

Some organizations mistakenly believe that data security compliance alone satisfies all data privacy compliance requirements. However, data security represents just one component of a complete data privacy compliance program.

Data privacy laws and compliance

Countries and regions worldwide have introduced privacy laws to protect the personal data of their residents. While specifics vary, these regulations share some common principles:

• Consent requirements for when and how organizations can collect and use personal data
• User rights that give individuals control over their data, including the rights to actions like access, deletion, and correction
• Data processing rules that emphasize transparency, purpose limitation, and security measures to protect personal information

Despite regional differences, most regulations focus on giving individuals more control over their data while holding businesses accountable for responsible data handling.

Let’s look at two landmark data privacy laws in more detail: the General Data Protection Regulation (GDPR) and the California Consumer Privacy Act (CCPA)/California Privacy Rights Act (CPRA).

Compliance with GDPR data privacy obligations

The GDPR is a data privacy law that protects the personal data of individuals located in the European Union/European Economic Area (EU/EEA). It applies to organizations that collect the personal data of these individuals and either:

• offer them goods and services

or

• monitor their behavior

Unlike some data privacy laws that apply only to for-profit businesses, the GDPR applies to any organization that meets these requirements, including public bodies and nonprofits.

There are seven core GDPR principles of processing:

• Lawfulness, fairness, and transparency: Organizations must collect and use personal data lawfully, fairly, and transparently. Personal data cannot be collected without a legal basis.
• Purpose limitation: Data should only be collected for specific, legitimate reasons and must not be used for anything outside those purposes.
• Data minimization: Only the amount of data necessary for specified functions should be collected and used.
• Accuracy: Personal data must be accurate and updated as needed. Any errors should be promptly erased or rectified.
• Storage limitation: Data should not be kept longer than necessary for its intended use.
• Security and confidentiality: Personal data must be protected from unauthorized access, loss, or damage using appropriate safeguards.
• Accountability: Organizations must take responsibility for and be able to prove compliance with these principles.

Organizations subject to the GDPR must comply with several obligations, including, among others:

• Obtaining explicit consent before processing personal data
• Being transparent about data processing practices and policies
• Conducting Data Protection Impact Assessments (DPIAs) for processing activities that are likely to result in a high risk to the rights and freedoms of individuals
• Implementing both security measures to protect personal data and data breach notification protocols
• Maintaining records of data processing activities
• Enabling data subjects to exercise their rights under the regulation

Penalties for GDPR violations are significant. For less severe violations, organizations can receive fines of up to EU 10 million or up to two percent of the total worldwide annual turnover for the preceding financial year, whichever is higher. For more severe violations or repeated infringements, these fines are doubled: up to EU 20 million or up to four percent of the total worldwide annual turnover for the preceding financial year, whichever is higher.

Compliance with the CCPA/CPRA data privacy obligations

The CCPA is a US-state level data privacy law that passed in 2018 and became effective in 2020. It was the first consumer data privacy law passed in the United States. It protects the personal information — which is how the law refers to personal data — of California residents. The CCPA has since been amended and expanded by the CPRA, which took effect in 2023 and became enforceable in 2024. The two laws are often referred to as the CCPA/CPRA.

The CCPA/CPRA applies to for-profit businesses that collect the personal information of California residents and meet at least one of the following thresholds:

• annual gross revenues exceeding USD 26,625,000 for the previous calendar year
• receive, buy, sell, or share personal information of 100,000 or more consumers or households
• earn more than half of their annual revenue from the sale of consumers’ personal information

Unlike the GDPR, which requires explicit — or opt-in — consent to collect personal data, the CCPA/CPRA follows an opt-out consent model. In most cases, businesses do not need to obtain consent before processing consumer data. 

Instead, consent is assumed unless the consumer actively opts out. However, special rules apply to data categorized as sensitive, and to minors’ personal information, which requires affirmative prior consent from the minor or their parent or legal guardian in most cases.

The CCPA/CPRA includes several compliance obligations for businesses that collect and process the personal information of California residents. 

• Providing clear notice at collection that informs consumers about the categories of personal information being collected and the purposes for which it will be used
• Maintaining a comprehensive privacy policy that details their data collection practices, consumer rights, and methods for submitting requests
• Placing a “Do Not Sell Or Share My Personal Information” link on their homepage and any page where they collect personal information 
• Implementing reasonable data security measures to protect personal information
• Following data minimization principles
• Establishing procedures to respond to consumer rights requests

A business that violates the CCPA/CPRA can face civil penalties of up to USD 2,663 per non-intentional violation and up to USD 7,988 per intentional violation or for a violation involving the personal information of minors.

The CCPA/CPRA is the only US consumer privacy law that grants consumers a private right of action, though this applies only in cases involving data breaches. Consumers can file a lawsuit to seek damages between USD 107 and USD 799 per incident, or the actual losses they suffered, whichever is higher. They can also request either injunctive or declaratory relief.

Global data privacy laws and compliance

The GDPR set a precedent influencing other countries, including the US, to implement their own data privacy laws to protect personal information. Organizations may now face various data protection compliance requirements, depending on where they operate and whose data they handle.

Some of the prominent regulations are:

• Brazil’s General Data Protection Law (LGPD)
• Canada’s Personal Information Protection and Electronic Documents Act (PIPEDA)
• South Africa’s Protection of Personal Information Act (POPIA)
• China’s Personal Information Protection Law (PIPL)
• Thailand’s Personal Data Protection Act (PDPA)
• various US state-level data privacy laws, including in Virginia, Florida, Texas,  Colorado, and Utah

Benefits of data privacy compliance

Complying with data privacy regulations helps organizations reduce legal and financial risks while strengthening user trust. Beyond meeting legal requirements, strong data privacy practices improve data management, enhance security, and support long-term business growth.

Reduce legal and financial risks

Data protection compliance reduces the risk of fines, lawsuits, and enforcement actions under global data protection regulations. Many of these regulations impose penalties that can cause significant financial strain. 

Compliance also minimizes the costs associated with regulatory investigations and legal defense. By meeting privacy requirements, organizations can avoid disruptions from enforcement actions that can limit operations and damage an organization’s market position.

Strengthen customer trust and brand reputation

Transparent data practices build trust by showing consumers that your organization takes their privacy seriously. According to the report from Cisco that we referenced earlier, 39 percent of consumers consider clear, accessible information about data use a top priority when deciding whether to trust a business. 

Organizations that prioritize user data protection demonstrate respect for consumer rights, which reinforces their credibility. In markets where user data protection is a key concern, strong data privacy compliance not only fosters trust but also gives businesses a competitive edge over those with weaker privacy practices.

Improve data management efficiency

Applying data minimization principles reduces the amount of personal data businesses collect and store, which makes data management easier and lowers storage costs. By limiting collection to only what is necessary, businesses avoid accumulating excessive information that can become difficult to track and organize. 

Well-documented retention and deletion policies further support efficiency. They help to prevent unnecessary data buildup and reduce the risks associated with storing excess information. Together, these practices help businesses stay organized and make personal data easier to manage over time.

Mitigate data privacy risks

Data privacy compliance helps organizations prevent breaches. Most regulations require implementing safeguards such as access controls, encryption, and regular risk assessments. These protections make it easier for organizations to identify vulnerabilities early and respond quickly to minimize damage. 

Data minimization further limits risk by reducing the amount of personal information that could be exposed in the event of a breach. Together, these measures create a stronger defense against data privacy threats.

Essential elements of data privacy compliance

To build an effective data privacy compliance program, organizations must implement several foundational practices that work together. These elements form the backbone of sustainable compliance while supporting operational needs and customer privacy expectations.

Establish clear data collection practices with appropriate limitations

Organizations must clearly define what personal data they collect, why they need it, who will have access to it, and how long they will retain it. Applying data minimization and purpose limitation principles helps avoid excessive collection while clearly distinguishing between necessary data required for core functions and optional information for secondary purposes. For organizations subject to the GDPR, all data collection should have a legal basis for processing.

Maintain comprehensive documentation of all processing activities

Keeping accurate and detailed records of data processing activities is essential for compliance with data protection regulations. This includes keeping records of processing activities that document what personal information is handled and why. Data mapping is one useful method that can help your team understand exactly where information is collected, stored, processed, and shared across systems.

Conduct data audits

Data audits help businesses see how personal information is collected, stored, and used, making it easier to identify compliance risks. Create a detailed data inventory to document the types of data you collect, its sources, and its purpose (including any third-party processing). This can help your business align operations with legal requirements. 

Records of processing activities provide a clear picture of how data moves through an organization. Risk assessments further strengthen compliance efforts by identifying vulnerabilities before they lead to security or regulatory issues.

Implement robust user consent management systems

Organizations need systems that collect specific, informed consent from users before processing their personal data. Using a consent management platform (CMP) can help. These systems should provide straightforward opt-in and opt-out mechanisms through cookie banners and preference centers that clearly explain data collection purposes. 

Organizations must maintain detailed consent records that show when and how users provided permission. These records will help prove data protection compliance during regulatory reviews, or for data subject access requests. Effective consent management also requires adapting to different regional requirements. For example, following the GDPR’s strict opt-in model for users in the EU/EEA while supporting the CCPA/CPRA’s opt-out approach for California residents.

Create processes to fulfill data subject rights requests

Organizations must develop clear workflows for handling various consumer rights requests or data subject access requests (DSARS) in a timely way. These can include access to personal information, correction of inaccurate data, deletion of records, data portability, and processing restrictions. 

Before fulfilling any request, organizations should implement identity verification steps to prevent unauthorized access to personal information. Keep detailed records of when requests are received, how they are handled, and when they were completed to demonstrate data privacy compliance during audits.

Maintain compliant and transparent data privacy policies

Most data protection laws require organizations to be transparent about how they collect, process, use, and share personal data. Some, like the CCPA/CPRA, explicitly mandate a privacy policy. Others, like the GDPR, set transparency requirements that organizations typically fulfill through a privacy policy or comparable document. 

Regardless of whether a privacy policy is mandated or not, a published privacy policy should meet all transparency requirements under whichever data privacy laws an organization is subject to. 

Privacy policies should be written in simple, clear language that average users can understand without legal expertise. They should be prominently displayed, such as through a link in the website footer or app’s settings menu. They should also be updated regularly to keep policies aligned with changes in laws, data handling practices, or business operations.

Deploy appropriate security measures to protect personal data

Organizations must use technical protections like encryption and data anonymization to safeguard personal information and reduce potential harm from unauthorized access. 

Implementing proper access controls with role-based permissions helps limit data exposure to only those employees who require it for specific business functions. 

Regular security audits and vulnerability assessments help identify potential weaknesses before they can be exploited. Organizations must also develop comprehensive incident response plans that address potential data breaches. Include procedures that meet notification requirements under regulations like the GDPR and the CCPA/CPRA.

Manage vendor and third-party risks

Organizations are responsible for protecting personal data, even when working with external vendors. Failing to assess third-party risks can lead to compliance violations, security breaches, and legal liability. Conduct due diligence before onboarding a vendor to verify that they follow data protection regulations. Use Data Processing Agreements (DPAs) to establish clear compliance responsibilities and promote accountability. 

Implement privacy by design principles

Privacy by design means integrating data protection compliance measures directly into systems, processes, and business practices from the outset, rather than adding them later. This proactive approach helps prevent privacy risks before they arise. 

When privacy is the default, it’s easier to keep user data secure without requiring additional steps. Privacy by design should be embedded across all areas of the business, including software development, marketing, and customer support.

Implement employee training programs

Effective data privacy compliance depends on employees understanding their responsibilities when handling personal data. Regular training sessions help your teams maintain awareness of regulatory requirements and company policies. In your training content, cover all applicable laws and how their requirements affect your business and customers, along with internal procedures for user data protection. 

In addition to general training programs, role-specific training addresses the unique privacy responsibilities of different departments — whether in IT, legal, marketing, or customer service. Employees benefit from practical guidance for their daily work.

Usercentrics CMP and data privacy compliance

Organizations should consider implementing a CMP to help with consent management requirements. Usercentrics CMP can help you achieve and maintain compliance with global data protection regulations through its key features:

• Coverage of and automated updates for global data privacy laws like the GDPR, the CCPA/CPRA, the LGPD, POPIA
• Fully customizable consent banners to obtain, manage, and document user consent for data collection and processing activities for enhanced transparency and user trust
• Geotargeting for consent banners that present relevant information and consent choices by region and regulation, e.g. including accept/reject options for EU residents or a clear “Do Not Sell Or Share My Personal Information” link for  California residents 
• Granular information and consent options for specific data processing categories, fulfilling the specific consent requirements of the GDPR
• Automated website scanner to identify new or noncompliant tracking technologies in use on sites, with categorization and blocking functionality

By integrating Usercentrics CMP with your platforms, you can easily manage user consent preferences and take steps to achieve and maintain data privacy compliance and build trust with your audience.

Usercentrics does not provide legal advice, and information is provided for educational purposes only. We always recommend engaging qualified legal counsel or privacy specialists regarding data privacy and protection issues and operations.