Navigating global data privacy laws in SAP with the rise of AI

As businesses continue to embrace digital transformation and harness technologies like Artificial Intelligence (AI), they face growing concerns about data privacy and security.

AI technologies rely on huge volumes of personal data to enable sophisticated inferences and predictions, creating significant privacy implications. With the increasing reliance on data comes the heightened risk of breaches, unauthorized access, and misuse of sensitive information. Simultaneously, businesses must navigate a constantly changing landscape of global data privacy regulations to stay compliant and avoid costly penalties.

This blog explores how businesses worldwide can stay secure and compliant with global data privacy laws; the potential penalties for non-compliance; and how EPI-USE Labs helps organizations safeguard sensitive data, particularly within SAP environments.

Current global data privacy legislation

Regions like the European Union (EU) have enacted comprehensive legislation, such as the General Data Protection Regulation (GDPR), to safeguard data privacy and security. Even in areas with less extensive regulations, data protection laws are becoming increasingly common and stringent. While the United States lacks a federal data privacy law, states like California are setting a precedent, serving as a model for other states to develop their own regulations until federal legislation is established.

Global data privacy laws currently in effect include:

• GDPR:
  Enforced in the EU, the GDPR is one of the most stringent privacy laws globally, requiring businesses to protect EU citizens' personal data and giving them control over how their data is processed. All organizations worldwide collecting, storing and processing personal data from EU) citizens must be able to reveal the data they have on the individual and what purpose(s) it is being stored and used for. To hold and manage the data, irrespective of whether this data is held in the EU or not, each organization needs to get informed consent from the data subject, and demonstrate compliance with the guiding principles of the regulation, including that data protection is at the heart of the system design.
• POPIA (Protection of Personal Information Act):
  South Africa’s POPIA regulates the processing of personal information and mandates that businesses implement proper data protection measures to ensure compliance with privacy standards.
• LGPD (Lei Geral de Proteção de Dados):
  Brazil's data protection law requires businesses to implement strict data privacy measures similar to the GDPR, and it governs the processing of personal data to protect the rights of Brazilian citizens.
• CCPA (California Consumer Privacy Act):
  California’s landmark legislation focuses on consumer rights, mandating that businesses provide consumers with the right to access, delete, and opt out of the sale of their personal data. The CPRA (California Privacy Rights Act) further enhances these protections.
  
  • Other statewide regulations include CPA (Colorado), CTDPA (Connecticut), CDPA (Indiana, Montana), ICDPA (Iowa), TIPA (Tennessee), TDPSA (Texas), UCPA (Utah), VCDPA (Virginia).
• Other global regulations include NZPA in New Zealand; PDPL in Saudi Arabia; PIPEDA in Canada; PDPA in Thailand; and PIPA in South Korea and Japan.

Ensuring compliance across borders

Global data privacy laws often present challenges for organizations that conduct business in multiple countries. One of the key challenges is ensuring compliance with laws such as the GDPR, even if a business is based outside the EU but interacts with EU citizens’ data. Similarly, organizations must be aware of laws like the CCPA if they engage with California residents in the United States.

Ensuring compliance with these laws can seem overwhelming. That’s why implementing robust data protection practices and leveraging solutions designed for privacy and security can simplify this process.

Penalties for non-compliance

Making sure your organization’s practices comply with your local governance laws will not only help you avoid major fines and penalties, but will also help maintain the trust of your customers. The consequences of non-compliance with data privacy laws can be severe. For example:

• GDPR: Non-compliance can result in fines up to €20 million or 4% of global annual turnover, whichever is higher.
• CCPA: Violations can lead to fines of $2,500 per violation or $7,500 per intentional violation, with the potential for additional penalties if consumers are not informed of their rights.

SAP systems and data privacy compliance

For organizations using SAP systems, protecting sensitive data becomes even more complex. SAP environments contain vast amounts of Personally Identifiable Information (PII), financial data, medical records, and other confidential information that must be safeguarded against unauthorized access.

AI systems depend on large datasets for their logic, often sourced from ERP systems like SAP, to train models and improve decision-making. This includes structured and unstructured data –everything from financial records and HR information to customer interactions – so businesses must be extra vigilant in ensuring compliance with privacy regulations.

From a compliance standpoint, organizations must protect the following types of data within SAP systems:

• PII: Includes sensitive data like names, email addresses, phone numbers, social security numbers, and more.
• Financial information: Tax Identification Numbers (TINs), income details, and other financial data that need to be securely protected.
• Medical records: Health data, which often falls under strict privacy laws like HIPAA in the US or GDPR in the EU, must be handled with the utmost care.

Ensuring that this data is protected, especially as it flows through SAP environments, is critical to staying compliant with global regulations. For recommendations based on our experience with implementing compliance solutions in SAP for our clients, you can request a copy of our quick guide.

Conclusion: Future-proof your data privacy strategy

With the growing complexity of data privacy laws around the world, and AI’s ability to gather and analyze massive quantities of data from different sources, businesses must implement data protection practices to ensure compliance and avoid major financial penalties.

EPI-USE Labs provides comprehensive solutions to help organizations safeguard sensitive data and stay compliant with global privacy regulations, particularly within SAP environments. By leveraging our solutions, like those within our Data Privacy Suite, businesses can maintain data privacy, secure customer trust, and navigate the evolving landscape of global data privacy laws with confidence.