Contracts and Cybersecurity: 2 Ways to Protect Your Business
Contract Management Software
Cybersecurity is a hot topic right now. Corporations of all sizes are being hit with very public data breaches that cost millions. Cybersecurity can be an afterthought with contracts, though it is very important as data breaches rise. Contracts both set requirements for what should happen in the event of a cyber security breach, as well as contain confidential company information that could prove harmful if compromised as the result of a breach. As with any important company asset, contracts should be treated securely. Below are two tips to help with company security surrounding contracts.
Security Tip #1: Know your Contracts
It is imperative for a company to know and understand the contents of its contracts. This is especially important in light of the increasing incidences of cyberattacks. In particular, a company must know which contracts include language pertaining to data or security breaches. This will ensure that the company knows what actions may be required of it or what actions it may expect of the other party in the event of such a breach.
For example, if a company does not know if it has contracts that contain breach-related language and requirements, then in the event of an attack, the company may fail to notify its clients or vendors of the breach or fail to take some other requisite action. Alternatively, a company may not know what actions the other party to a contract is required to take in the event that that party suffers a breach and the lack of knowledge may make it difficult to hold the other party accountable.
In either of the above situations, the breach combined with one party’s failure to take the contractually required action may make an already complicated and expensive situation much worse. Companies can reduce the potential impact of unforeseen events by merely understanding its contract portfolio, particularly the clauses and provisions relating to significant occurrences (such as a cyber attack) and then adequately prepare a response plan for such an event. As an added bonus, by remaining aware of which contracts contain certain protective language, this may also help a company realize that it has contracts that are lacking such language and are perhaps in need of revision.
Security Tip #2: Protect your Contracts
Because many contracts contain confidential information, measures should be taken to protect them. A cloud based contract lifecycle management solution with stringent security standards can serve as a central repository, allowing a company to consolidate its contracts in one secure location. When choosing a CLM solution, it is wise to consider the different security features available. Is data encrypted? Are there permission-based user roles in the contract repository to limit access? Where is data stored? Is there a backup in case of an emergency?
Other useful features that can keep contracts secure and mitigate the possibility of misappropriated data include two-factor authentication, disabled printing, and more. Of course, in addition to keeping contracts secure, it is important to remain abreast of the contracts’ contents (for the reasons mentioned above). This can be done via a contract management service that has customizable alerts and report generation tools.
Obviously, it may be difficult to completely safeguard information against unwanted attacks. Nonetheless, there are certainly measures that can be taken and services that can be utilized to drastically decrease the likelihood of a breach as well as the impact that such a breach will have should it occur.
The Buyer's Guide to Contract Management Software
Quickly identify solutions to your specific contract management challenges.
3 Steps to Improve Your Company's Contract Compliance