Tokenization and IRM for Risk-Based Privacy, Security, and Compliance


The global expansion of privacy regulations is forcing entities to re-evaluate how they handle personal information. To meet these mounting regulatory obligations and reduce the risk associated with processing sensitive data, organizations should take a data-centric approach to security and develop a unified strategy for compliance. This can be done by utilizing an integrated risk management (IRM) platform to harmonize controls and by implementing tokenization for the de-identification of personal information.

IRM and tokenization can help organizations minimize risk and streamline their compliance efforts via the combination of their respective solutions. Leveraging the two can empower organizations to satisfy the data protection requirements of multiple privacy laws—such as the European Union’s General Data Protection Regulation and the California Consumer Privacy Act—and reduce the risks they face.

Unlike governance, risk, and compliance (GRC), integrated risk management focuses more broadly on an overall strategy for reducing risk across an organization. Whereas GRC might combine more specifically targeted procedures designed for individual departments, IRM approaches an organization’s risk management and compliance endeavors as a whole. The idea here is that reducing risk should be a cohesive initiative that prioritizes a desired outcome over the minutiae of granular applications. By creating a single comprehensive strategy that informs policies and operations company-wide, organizations can increase the efficiency, simplicity, and cost-effectiveness of their security practices.

When this approach is coupled with a data-centric security technology such as tokenization, organizations can truly begin to see the benefits of a complementary, synchronized strategy for risk management. As a result, they can streamline security and compliance by taking a prescriptive approach to data protection. By focusing on identifying, locating, and securing sensitive data—rather than simply meeting minimum compliance obligations—organizations will improve their security standing while simultaneously better positioning themselves to anticipate and satisfy developing requirements and future regulations.

Because tokenization removes sensitive data from internal systems, stores it in a secure cloud data vault, and then returns a nonsensitive equivalent to organizations for business use, it can virtually eliminate the risk of data theft, making it a particularly useful tool for risk reduction and compliance. Tokenization not only secures sensitive data, but it also devalues it. In other words, it desensitizes the data via the process of pseudonymization, which the GDPR specifically mentions as an appropriate method for de-identifying data. In fact, Recital 29 mentions incentives for organizations to apply pseudonymization, and Articles 25 and 32 specifically call out pseudonymization as an appropriate technical measure for protecting personal data.

“The processing of personal data in such a way that the data can no longer be attributed to a specific data subject without the use of additional information.”
– Pseudonymization as defined in Article 4(5) of the GDPR

Additionally, the GDPR is more lenient in its restriction of the use of personal data when that data is de-identified. Article 6(4)(e) potentially allows processors to use pseudonymized data for purposes outside the realm of why the data was collected in the first place.

Pseudonymization is an extremely useful tactic for achieving regulatory compliance, and it comes as a direct result of tokenization. This demonstrates the value of employing a data-centric security and risk-reduction strategy: It can beget compliance on its way to achieving its intended goals of security and risk reduction. In effect, by focusing on security and risk, compliance takes care of itself, improving an organization’s overall security practices in the process.

To learn more about IRM, tokenization, or the SureCloud and TokenEx platforms, attend our upcoming webinar, "Using Integrated Risk Management to Achieve Data-Centric Security." You can sign up here. If you have any questions, please contact us today at or

Topic(s): compliance , data security , tokenization , pseudonymization

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