There are many reasons why a company may go through a merger or acquisition – a company might be buying out a competitor, two companies might merge in order to achieve economies of scale, or it might be done in order for a company to access proprietary technology to name a few. Regardless of the reasons, this is a time to be on high alert as a business owner. If your business handles sensitive information and sensitive documents, it’s crucial that these materials are handled securely during the acquisition process in order to protect all parties from malicious intent.
Nowadays, data breaches of high-profile companies are becoming more and more commonplace, as hackers compromise folders and large files that were thought to be secure by system administrators. Unfortunately, everyone loses in a data breach, as the public’s trust in a company falters, and customer data can also be utilized for various acts of malfeasance by hackers. As a result, it’s crucial that you have end-to-end encryption when it comes to sharing a company’s sensitive information. Here are some tips for securing your data during a merger.
Don’t count on the same platforms you use for everyday business.
With so many businesses working remotely due to COVID-19, there has been an increase in file sharing through email, Slack, or even cloud storage options like Google Drive and Dropbox. While Google Drive and Dropbox do offer some permission-based user accounts for relatively secure file sharing, when it comes to handling the file sharing needs of a merger and acquisition, you need a much higher-quality encryption service than those of products created for consumer use.
Particularly, when you work in the medical field and handle personal data subject to HIPAA regulations, best practices are to use a secure file sharing system rather than something like Microsoft OneDrive or Dropbox. Hackers are familiar with these sorts of cloud services, and the last thing you want to deal with during a complex merger is fending off hackers and other bad actors trying to access your folders. Day-to-day platforms are also vulnerable to internal risks, as access is typically granted to a wider audience and information housed in this way is more vulnerable to breaches in confidentiality. Specialized platforms with higher quality security features are more suitable for the extensive due diligence process involved in mergers and acquisitions.
Invest in software that can help you create a virtual data room.
Virtual data rooms are much more secure when it comes to sharing financial statements and contracts and other confidential information with extensive digital rights management features. A virtual data room provides a highly secure online sharing platform for you to upload and download documents to, complete with permissions-based access monitored by digital rights management tools that give you the peace of mind that nobody will be able to access your secure file—whether intentionally or by accident.
A virtual data room is as secure, if not more so than the in-person deals of the past, where only certain people would be allowed in the room of a physical location. This sort of user permission control allows you to be absolutely certain that your data won’t wind up in the wrong hands. Plus, there are additional features offered to administrators of different virtual data rooms that allow for other powerful collaboration tools and data encryption that truly go above and beyond traditional cloud storage solutions. When you really need to keep everything under lock and key, a virtual data room can go a long way in ensuring that you feel good about how each online file is accessed during your merger.