Modern asset management revolves around data and its secure exchange. Increasingly, more parties, including internal departments and external service providers, are involved in ongoing operations, transactions, and even certifications and ratings. This collaboration pools diverse expertise to manage assets with maximum efficiency.

However, the growing amount of data and stakeholders also elevates the risk of insufficient access protection and uncontrolled access. Potential consequences include data misuse and significantly reduced efficiency. The solution? Robust data access governance.

What is data access governance?

Data access governance is part of asset management companies' global security strategy and outlines strategies for secure data access and management. It's not just about technical solutions; it also involves people and processes that minimize risks from inadequate access protection.

Data access governance aims to prevent uncontrolled access and data misuse and to enable the team to quickly and conveniently access the data needed to work efficiently and make data-driven decisions.

The risks associated with having inadequate access protection include:

Sanctions for non-compliance with data handling laws

If inadequate access protection violates legal standards, companies may face fines and increased controls (leading to higher costs). Additionally, certifications could be revoked.

Data theft, manipulation, and loss of know-how

Sensitive data (business figures, codes, strategy papers, patents, personal data, etc.) that fall into the wrong hands can cause substantial damage.

Poor data quality

Data without regulated access tends to be of poor quality. Where anyone can edit, copy, and delete, data loss, duplicates, and inconsistent data are likely to occur. This results in additional effort, poor decision-making due to conflicting data, and frustrated employees: 

• For example, when Architrave’s experts clean up a client’s asset documentation, between 30 and 50 percent of the documents are usually discovered to be redundant.
• Companies report an average 12% revenue loss due to poor data quality.

Loss of trust, and reputational damage

When data breaches or leaks become public, the loss of trust is considerable. This poses an existential threat as it significantly hinders new customer acquisition, existing customers may leave, or investors may withdraw their funds.

How data access governance minimizes risks

Effective data access governance is instrumental in mitigating a myriad of risks associated with the handling of data within asset management firms. It encompasses a structured approach to securing data from unauthorized access and leaks, which can lead to severe financial, legal, and reputational consequences. Here’s how data access governance plays a pivotal role in enhancing the overall security posture of an organization:

Taking stock and identifying weaknesses

An initial analysis of existing data sources and storage locations helps identify vulnerabilities. Companies typically use an average of four storage systems, including private hard drives, USB sticks, various cloud systems, and email inboxes, all of which pose risks of data misuse and should not be used in a corporate context.

The digital data room: a secure central repository

Modern data rooms significantly contribute to data and document security. They ensure controlled access and feature monitoring and reporting functions that document who accessed what data and when. The goal is to balance accessibility and control so that the team can quickly and comfortably access needed data despite security barriers.

One of the most important features of a data room is its comprehensive, granular permission management. Access and editing rights can be allocated to various stakeholders (asset managers, bidders, property managers, lawyers, etc.) while a set of pre-prepared roles speeds up the sensible allocation of rights. However, individual rights can still be adjusted and fine-tuned in the administration area.

Encryption: protecting data at rest and in transit

Encryption is essential in data access protection, both during storage and transmission. It converts the data into an unintelligible code that cannot be read without the corresponding decryption. Thus, only authorized users (those with the decryption code) can access sensitive data.

Training and educating a team

Data access governance isn’t exclusively limited to technical solutions. It must also involve participants and educate them on how best to handle data and documents securely. Through training and education, employees are informed about the risks of improper data access, reducing the risk of data protection violations and cyberattacks. 

Additionally, trained employees are quicker to recognize potential threats (phishing, social engineering, insecure passwords, public Wi-Fi connections, etc.) and can respond appropriately. An established security culture makes a significant contribution to protecting against financial losses, reputation damage, and legal consequences.

Conclusion

Data access governance plays a pivotal role in modern asset management by ensuring security and efficiency in data handling. Appropriate security measures minimize risks such as data misuse, poor data quality, and loss of trust with clients and partners. 

The use of digital data rooms, granular permission systems, and encryption technologies enables secure and controlled data access. Moreover, training and sensitizing employees are crucial to fostering an awareness of data protection risks and establishing a robust security culture.