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Cybersecurity and Privacy Policy as a Board of Directors Issue

Cybersecurity and Privacy   |   January 18, 2017
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Cybersecurity and privacy of customer information have become such critical issues that in-house counsel should treat them as board of directors-level issues. In-house counsel should do that with presentations for their boards of directors that address both of these issues at a high level, but in sufficient detail to allow the board of directors to make informed decisions for the company on the direction it will take.

The best resource for education and information on these topics remains the Sedona. The Sedona conference has produced excellent work on cybersecurity issues. They have also produced a recent excellent primer on privacy laws. Membership in the Sedona conference is open to in-house counsel and provides excellent discussion and information for those who attend. I recommend membership to all in-house counsel who have Board reporting responsibilities.

In addition, the Business Law Section of the ABA produces regular updates on the status of cyberspace law, which I also recommend.

In my opinion, every company should develop cybersecurity and privacy policies that anticipate and reasonably address compliance and readiness in these areas. Companies should consider cybersecurity policies that:

  • are developed with direction from the board of directors, with Chief Information Officers and other appropriate stakeholders working in close cooperation with the company’s IT personnel.
  • include a playbook that can guide their response to the all-to-common data breach scenario.
  • include conducting simulations of data breach response, working with vendors and outside counsel to reheard their response to a data breach.
  • include certification by ISO or a similar standards organization.

Similarly, companies should audit their privacy policies’ compliance with applicable law on a regular basis, because this area of the law develops rapidly as new regulations are promulgated and new case law is established.

Outside counsel can, of course, assist inside counsel in auditing a company’s existing policies, developing appropriate policies, and reporting to the Board of Directors.


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