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Privacy Impact Assessment

What Are Privacy Impact Assessment Best Practices?

Depending on your region, data supervisory authority, and data privacy regulation language, you will find there are a number of types of risk assessments under the labels that include Privacy Impact Assessment, Data Protection Impact Assessment, and Data Protection Assessments. They can certainly be dizzying! We’ll break it down for you here to help you determine which is best for where you are in your privacy compliance journey.

Are you a bringing to market a new technology or data-driven product? Have you considered all the privacy implications both nationally and internationally? Are you concerned about the changing regulations and requirements and unsure what your obligations might require of you?

2B Advice can provide you with a comprehensive privacy impact assessment and guidance. Our expert-conducted assessments will provide you with the information and insight you need to be successful.

In the United States and in Europe, companies of all sizes trust our advice and experience. Our international team has experience in regulatory agencies from the Federal Trade Commission in Washington D.C. to the Data Protection Authorities of Germany.

Together, our experts have a broad base of experience and knowledge to ensure comprehensive and trustworthy evaluations of your products and implementations prior to their introduction to the marketplace.

Learn More About Privacy Impact Assessments

See how we can help your company with a Privacy Impact Assessment today. 

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Frequently Asked Questions About Privacy Impact Assessments

The Privacy Impact Assessment (PIA) is an organization wide initial risk assessment to identify privacy risk exposure of a company. The assessment aims to identify the level of maturity of the data protection program and point out what areas of concern around processing of personal data create risk for data subjects and the organization. The PIA differs from the more famous little brother DPIA for scope and focus. The scope of the PIA is comparatively much broader as the entire the organization is the target of the assessment. Secondly, it focuses on the identification of the risks for the organization and the data subjects.

Gartner includes Privacy Impact Assessment (PIA) in four of their 2021 Hype Cycles:

  • Hype Cycle for Privacy
  • Hype Cycle for Cyber and IT Risk Management
  • Hype Cycle for Legal and Compliance Technologies
  • Hype Cycle for Data Security

Source: Gartner, 2021

The PIA is a preliminary assessment of the organization’s data protection program and structure to identify possible risk for the compliance risk for the organization. The result of this assessment can benefit management because it offers insights into the possible risks triggered by certain procedures or by their absence (e.g. lack of DSAR process). In addition IT, risk and privacy teams can leverage it to achieve Privacy by Design (PbD). Privacy by Design means “data protection through technology design.” In essence, this means you have to integrate data protection into your processing activities and business practices, from the design stage and throughout the lifecycle of the data. PIAs can be used to identify and mitigate organizational privacy risk and are usually conducted when a new business process is implemented, a new company is acquired, or at the design stage of a new product or technology development. PIAs can also be applied reactively to existing processes, products, and systems when they are altered, such as when a company expands business into a new country or region, or when a new data protection law comes into effect.

An initial assessment or initial PIA can be part of a proactive set of assessments when establishing a privacy program. Also, a PIA can be part of an annual audit of the privacy organisation within your company. A PIA seeks to identify the overall compliance risk exposure of a company regarding compliance with privacy regulations.

The outcome of a PIA should identify cases where more specific risk assessments, i.e., DPIA-EU, DPA-US or DTIA need to be carried out.

Whether we are talking about a PIA, a DPA, or a DPIA, typically the governing regulation provides guidelines around areas of risk. The GDPR has the broadest definition in that DPIA is required when the processing is “likely to result in a high risk to the rights and freedoms of natural persons”. However, US state data protection acts have fairly specific definitions.

Most often full data protection assessments or data privacy impact assessments are required reactively, in line with specific regional or national privacy regulations and related to specific activities such as prior to introducing a high risk processing activity or new technology or ones that bring heightened risk to consumer privacy or security such as profiling or targeted advertising.

Under Virginia’s CDPA, data controllers are required to conduct data protection assessments of any processing activities that involve personal data used in any of the following: (a) targeted advertising; (b) sale of personal data; (c) for purposes of profiling; (d) sensitive data; and (e) data that presents a heightened risk of harm to consumers.

Under the Colorado Privacy Act, data protection assessments focus on processing that presents a heightened risk of harm to the consumer such as processing for (a) targeted advertising where profiling is a risk of unfair or deceptive treatment, financial or physical injury, or intrusion on solitude or seclusion; (b) the sale of personal data; or (c) processing sensitive data.

Under California’s CPRA updated Section 1798.185 (a)(15), a data protection assessments must be conducted by businesses whose processing of consumers’ personal information present significant risk to consumer’s privacy or security.

CPRA now requires businesses whose processing of consumers ‘personal information presents significant risk to consumers’ privacy or security, to:

(A) perform a cybersecurity audit on an annual basis, including defining the scope of the audit and establishing a process to ensure that audits are thorough and independent. The factors to be considered in determining when processing may result in significant risk to the security of personal information shall include the size and complexity of the business and the nature and scope of processing activities,

(B) submit to the California Privacy Protection Agency (CPPA) on a regular basis a risk assessment with respect to their processing of personal information, including whether the processing involves sensitive personal information, and identifying and weighing the benefits resulting from the processing to the business, the consumer, other stakeholders, and the public, against the potential risks to the rights of the consumer associated with such processing, with the goal of restricting or prohibiting such processing if the risks to privacy of the consumer outweigh the benefits resulting from processing to the consumer, the business, other stakeholders, and the public. Nothing in this section shall require a business to divulge trade secrets.

Under the EU’s GDPR, DPIAs are not necessary for every processing activity, but are mandatory for any new high risk processing projects and should be carried out prior to the processing (GDPR Article 35) or during the design phase of a new technology.

An initial assessment or initial PIA can be part of a proactive set of assessments when establishing a privacy program. Also, a PIA can be part of an annual audit of the privacy organisation within your company. A PIA seeks to identify the overall compliance risk exposure of a company regarding compliance with privacy regulations.

The outcome of a PIA should identify cases where more specific risk assessments, i.e., DPIA-EU, DPA-US or DTIA need to be carried out.

Whether we are talking about a PIA, a DPA, or a DPIA, typically the governing regulation provides guidelines around areas of risk. The GDPR has the broadest definition in that DPIA is required when the processing is “likely to result in a high risk to the rights and freedoms of natural persons”. However, US state data protection acts have fairly specific definitions.

Most often full data protection assessments or data privacy impact assessments are required reactively, in line with specific regional or national privacy regulations and related to specific activities such as prior to introducing a high risk processing activity or new technology or ones that bring heightened risk to consumer privacy or security such as profiling or targeted advertising.

PIA’s are a best practice for the appropriate and purposeful use of personal data by businesses. A PIA reduces privacy risk by allowing you to identify and mitigate against data protection risks, plan for the implementation of any solutions to those risks, and assess the viability of a project at an early stage.

The result of a PIA enables regulatory compliance, improves control over personal data throughout the data life cycle, and determines authorization and access management. It assists in the prevention of data breaches and personal data misuse or abuse. Importantly, it helps IT, privacy and security leaders to quantify risk to consumers and apply suitable mitigating controls in a timely manner.

The cost of a PIA will depend on the scope of the assessment. A preliminary assessment covering a single state law and a mid-size company with relatively few high risk processing activities, for example could be at list as $10,000. However, depending on the complexity, the number of business entities, the number of applicable data protection laws, and the number of high risk processing activities, the cost would be higher.

The Privacy Impact Assessment is the first step in understanding what the organization needs and requires from the data protection standpoint.

The PIA pinpoints the area that need implementation and improvement for a cohesive and risk adverse development of the data protection program. From the PIA the organization will gather intel on the need for DTIA and what and where a DPIA in needed.

In essence, any project related to the processing of personal data either introduces a new processing activity or at minimum applies new technology to existing processes, and this may cause risk and attack surfaces to change. An initial impact assessment conducted at the initiation of a project protects against the need for retroactive assessment and an endless loop of remediation. An initial assessment can identify where any special categories of personal data or in particular, specially defined high-risk activities are or might be in play.

After you have conducted your organizational information audit, then you would begin building your records of processing activities. The record of processing activities (RoPAs) allows you to make an inventory of data processing and to have an overview of what you are doing with the concerned personal data. RoPAs will include significant information about the data processing activities being carried out.

To best understand when the processing operations are likely to result in a high risk to the rights and freedoms of natural persons via a PIA, the dataController, with the data protection officer and processors or third parties, should be responsible for carrying out a privacy impact assessment. The controller is responsible that the PIA is carried out and is accountable for the risk, though the PIA itself might be done by someone else.

The Privacy Impact Assessment is the first step in understanding what the organization needs and requires from the data protection standpoint.

The PIA pinpoints the area that need implementation and improvement for a cohesive and risk adverse development of the data protection program. From the PIA the organization will gather intel on the need for DTIA and what and where a DPIA in needed.

In essence, any project related to the processing of personal data either introduces a new processing activity or at minimum applies new technology to existing processes, and this may cause risk and attack surfaces to change. An initial impact assessment conducted at the initiation of a project protects against the need for retroactive assessment and an endless loop of remediation. An initial assessment can identify where any special categories of personal data or in particular, specially defined high-risk activities are or might be in play.

After you have conducted your organizational information audit, then you would begin building your records of processing activities. The record of processing activities (RoPAs) allows you to make an inventory of data processing and to have an overview of what you are doing with the concerned personal data. RoPAs will include significant information about the data processing activities being carried out.

How can 2B Advice help with Privacy Impact Assessments?


2B Advice offers privacy compliance software and services that help with Privacy Impact Assessments including risk assessment tools and catalogs, stakeholder questionnaires, a database for records of processing activities and more. If you need help getting started, ask about our Preliminary Privacy Impact Assessments, or get our help with your DPIA for new technologies.

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Our Data Privacy Service Portfolio

Privacy Impact Assessment

2B Advice offers privacy compliance software and services that help with Privacy Impact Assessments including risk assessment tools, catalogs, and more.

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Regional GDPR Gap Analysis

The Regional GDPR Gap is an initial assessment to identify organizational gaps in your privacy organization based on the current state of your privacy program.

Standard Contractual Clauses

According to the GDPR, SCCs ensure appropriate data protection safeguards as grounds for data transfers from the EU to third countries.

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