DPIA vs PIA: What are these and which one should I follow?

Privacy Impact Assessments (PIAs) and Data Protection Impact Assessments (DPIAs) are standards that help businesses mitigate data processing risks and safeguard sensitive information. They provide a framework for you to address gaps in your privacy strategy and achieve regulatory compliance. 

But which one of these risk assessments should you follow – PIAs or DPIAs? This is a common question for every security-conscious business, and it can be challenging to tell the difference between the two, so much so that the terms are often used interchangeably. 

PIA is considered a guideline: a collection of best practices to help businesses achieve compliance. By contrast, DPIA is a legal requirement when processing high-risk data under several standards, including the GDPR. 

That’s the core difference, but it’s not the only one. In this guide, we’ll dive deeper into how each standard works and how they differ. We’ll also provide some guidance regarding how you can meet both standards when designing your own internal data security posture.

What is a PIA?

Privacy Impact Assessment (PIA) is a systematic approach to identifying, assessing, and addressing potential risks associated with a particular project, system, or process that handles sensitive personal information. It’s typically used at the start of a project cycle, such as when unveiling a new product, acquiring a new business, or overhauling a legacy system.

The standard evaluates data collection, data handling, and data disclosure processes to determine their impact on individuals’ data privacy rights. If any risks are discovered, PIA then provides guidance to mitigate them. It answers several important questions, including:

• Has the business understood and addressed the risks of collecting and maintaining personally identifiable information (PII)? 
• Does the organization have effective and compliant processes in place for data transfer and data use? 
• Is sensitive information collected compliant with regulatory requirements, such as opt-out and opt-in consent management models?
• Are protections in place to mitigate internal and external cyber threats?
• How ready is an organization to respond to a data breach in the worst-case scenario? 

PIA is a requirement for federal agencies in the US under the eGovernment Act of 2002. It’s also mandated in several states, like California, Colorado, Delaware, and Connecticut, specifically in situations where processing PI poses more harm than usual, such as when implementing new IT systems, changing business processes, or converting paper-based records to electronic systems. 

That said, PIA typically isn’t a legal requirement. Instead, it’s considered a collection of best practices. Its ‘privacy-by-design’ methodology means businesses often use it to proactively evaluate and address their approach to privacy protection. 

What is a DPIA?

A Data Protection Impact Assessment (DPIA) is a privacy assessment that centers on the risks and impact of processing individuals’ personal data. It examines the scope and context of the data processing activities to discover problems and help organizations mitigate them. 

The DPIA is a mandatory rule under data protection regulations, such as the General Data Protection Regulation (GDPR). The GDPR requires businesses to conduct a DPIA for any data processing activities that could pose a risk to a person’s privacy rights and freedoms. 

Any organization that handles the data of EU residents or is based in the EU will need to comply with GDPR DPIA legislation. Failing to undertake a DPIA when undertaking high-risk data processing could lead to a GDPR compliance breach, resulting in fines of up to €20 million or 4% of your annual turnover, whichever is greater. 

DPIA vs PIA

Let’s explore the difference between PIAs and DPIAs – we’ll break it down with a table:

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‍The vital difference between PIA and DPIA is that the DPIA process is a legal requirement under the General Data Protection Regulation (GDPR). It specifically outlines high-risk data events that require businesses to perform a DPIA, including: 

• Processing genetic data
• Identifying individuals via biometric data
• Tracking geolocation
• Creating artificial intelligence (AI) and machine learning (ML) models
• Processing PI not obtained directly from an individual
• Systematically monitoring individuals on a large scale 
• Tracking children for marketing

By contrast, a PIA may be required in certain circumstances, but it’s closer to a guideline than a regulation. It’s also less focused than DPIA, covering a broader range of privacy risks and processes. 

What are the benefits of conducting a PIA or DPIA?

As long as you aren’t required by a regulation like the GDPR or CCPA to conduct a privacy assessment, you aren’t mandated to complete one. That said, doing so periodically can offer a host of benefits for your business: 

1. Reduced risk of data breaches

Both a PIA and DPIA identify vulnerabilities in your data processes proactively. They pinpoint potential security gaps that attackers could exploit and provide actionable guidance to patch them up. This strengthens your data security framework and prevents costly breaches. 

2. Compliance with regulation

The DPIA is an essential component of GDPR compliance. Understanding the requirements of this standard is essential if you handle the data of EU citizens. That said, both the DPIA and PIA act as a foundation for data protection; following either set of guidelines is a proven route to regulatory compliance. 

3. Reputation and customer trust

A data breach isn’t just a financial burden — it can ruin your reputation and erode consumer trust. Conducting DPIAs and PIAs ensures businesses can identify and mitigate risks to safeguard consumer data effectively. This process should begin with robust data discovery, which provides the foundation for assessing and managing data-related risks.

4. Operational efficiency

DPIAs and PIAs streamline data governance and improve incident management. They provide a clear overview of data flows, allowing businesses to identify and resolve inefficient collection, storing, and processing practices. This allows for standardized procedures across teams and more efficient processes company-wide. 

How can I prepare for a PIA or DPIA?

PIA and DPIA both have strict requirements, but the good news is that the process for each is relatively similar. Both involve defining the context of personal data processing, assessing risks, implementing controls to meet compliance, and then validating those controls. 

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That means you can follow these 10 overarching steps, regardless of the assessment you’re conducting. 

Step 1: Gather relevant information

Collect all required details and context about your data processing activities and the PI that could be at risk.

Step 2: Involve key stakeholders

Engage a cross-functional team of experts and leaders who can help maintain clarity during the project.

Step 3: Review the laws

Review the legislation that applies to your proposed data processing activities. 

Step 4: Map your data inventory

Map out the inventory and data flows of the PI you’re collecting and processing. 

Step 5: Tag personal data

Classify any personal data in your data inventory to identify sensitive information that must be protected. 

Step 6: Perform a risk assessment

Identifying and mitigating risks to the PI and prioritizing them based on their potential data protection impact. 

Step 7: Build your strategy

Develop a risk mitigation strategy to minimize potential privacy risks associated with data processing. 

This could be implementing data minimization and data retention practices, ensuring data quality, appointing a data protection officer, establishing policies, implementing access controls, or any other strategy to support personal data protection. 

Step 8: Finalize and implement

Source approval from data privacy and security experts and respond to feedback. Then, put the agreed plan into action. 

Step 9: Document the process

Take detailed notes of your risk universe, decisions, and mitigation strategies as evidence of compliance. 

Step 10: Evaluate and review

Regularly analyze the effectiveness of your risk mitigation strategy in ensuring compliance. Review and update as needed. 

Documentation is the critical factor. Keep a record of processing activities, the importance of it, the hurdles involved, and the steps you’ve taken to mitigate potential risks – this can’t be overstated. 

While PIA documentation is at the discretion of the business, the GDPR has specific requirements for DPIAs. The UK Information Commissioner’s Office provides a global, helpful DPIA template for organizations. 

Summing up

Adhering to DPIA and PIA is the easiest way to protect your sensitive information and adhere to data protection regulations. Follow these standards and implement the steps we’ve provided to stay on the right side of compliance. 

But here’s the thing: your company’s growth relies on compliance. Understanding the DPIA and PIA models will provide a pathway to achieving this, but it won’t make getting there efficient. 

The RecordPoint solution

RecordPoint’s data inventory and categorization tools will help you discover, classify, and catalog your sensitive data, no matter where it lives. This gives you a single source of data truth, providing total visibility over all of your sensitive information, making it easier to see and easier to manage.

If any sensitive information is at risk, our AI governance platform can help you identify and respond to the problem immediately. And when it comes to documentation, you’ll already have everything you need to prove your compliance. 

Schedule a free demo today to learn how RecordPoint can streamline your PIA and DPIA compliance.

FAQs

Who should be involved in conducting a PIA or DPIA?

The best course of action is to involve all teams and key stakeholders. And, most importantly – involve them early. While there may be a data protection officer that leads the assessment, there are many other roles and responsibilities at play.

From compliance experts to project managers and IT teams, the more diverse perspectives you can involve, the more effective your data protection framework will be. 

How long does it take to conduct a PIA or DPIA?

It varies depending on the complexity of the project. Many assessments take somewhere between a few days and a couple of weeks. 

Some assessments, especially for large-scale processing tasks under the EU GDPR DPIA rules, may take months. The more data being processed at once, the longer the time frame. 

What tools and technologies can be used to conduct PIAs and DPIAs?

The most effective tool for conducting PIAs and DPIAs is record management software (RMS). This solution can provide total data visibility, help with automating data mapping, and support accurate documentation with a centralized solution for managing your data inventory. 

This effectively simplifies and makes compliance with the PIA and DPIA simpler and more efficient.