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Data sovereignty is the term used to refer to the laws governing how data is generated, processed and stored in a given geographical location.
It is important for capital markets’ Cloud Infrastructure as a Service providers to reassure organisations how the complexities of data sovereignty legislation and regulation are handled.
Geographical inconsistencies
Data sovereignty laws vary across jurisdictions. This means that data stored in the cloud is subject to the laws of more than one jurisdiction.
With different obligations regarding data security, privacy and breach notifications dependent upon where data is hosted or controlled the data sovereignty conundrum becomes more complex.
Since one of the key strengths of cloud infrastructure is its borderless and global nature, balancing the advantages of flexibility and agility in the addition of resources and capacity with the legal obligations for data from region to region is a crucial consideration in cloud IaaS implementations.
Controls over Third Parties
Issues such as data localisation and GDPR prohibit and limit data transmission outside its original location. Data storage and processing by Third Party Cloud Service Providers is also precluded.
Capital markets firms must take a very thorough approach to determining their cloud strategy and ensure they are selecting providers who are experienced in the legal limitations imposed by data sovereignty laws.
Barrier to entry
In a financial context compliance and security of data are of utmost importance. Concerns about how these are navigated in cloud computing has been a significant deterrent for cloud migration projects amongst financial institutions.
Above all organisations need clarity about where their data will be stored, how often it needs to be transferred from one place to another, what laws and financial regulations it will be subject to, and what the potential business harms are in data breaches.
Capital markets businesses will benefit from the depth of understanding, sophisticated i/s provision and economies of scale available from a specialist IaaS partner in the sector.
Regulatory requirements
The type of data processing organisations wish to conduct in the cloud also attract different controls.
Production data, back-ups and disaster recovery all carry data sovereignty implications. Cloud providers need to offer financial businesses a choice of storage locations for the backups, images and replicas required for disaster recovery. They also need to reassure organisations they are fully aware of and compliant with the regulatory requirements.
Service Provider capabilities
Data encryption and the global application of the most stringent data protection and security requirements are technological steps that service providers can take to mitigate the risks of cybersecurity breaches and data sovereignty controls.
Working with a service provider who specialises in financial cloud deployment, and who has therefore developed the appropriate strategies and know-how to manage the implications of data sovereignty in the cloud is crucial for capital markets businesses.
Data control, management and curation
Digital data sovereignty considerations embrace infrastructure, strategy, governance framework and the skills required to navigate the complex landscape of data protection, security, resilience and compliance.
All environments, whether on-prem, dedicated or public cloud need to meet sovereignty requirements, and the right data must be deployed to the right venue and cloud instance.
Working with a cloud IaaS partner who understands the best physical and virtual locations for different workloads and applications in the financial universe makes multi-cloud deployments as secure, compliant and sovereign as possible, without losing the benefits of cloud flexibility and agility.
Beeks’ offering
As specialists in the technical infrastructure underpinning capital markets trading Beeks Group is highly experienced and knowledgeable about all the different permutations of private and public cloud capabilities, and how far these are suitable for the needs of financial institutions, while also meeting regulatory and legislative demands.
We offer secure connectivity, and high-performance, guaranteed private cloud infrastructure all around the globe, and can accommodate exclusive, single-tenant security requirements, as well as replication of hosting.
Whilst Beeks recognises the cost-effective value of public cloud shared resources offering businesses cost-effective services, we also recommend a ‘horses for courses’ approach. This means ensuring that our customers align the importance of their workload with the relevant solution.
Find out more here
beeksgroup.com | hello@beeksgroup.com
