A virtual data room (VDR) is a digital repository that facilitates collaboration and the sharing of sensitive data in secured, encrypted environments. Businesses use VDRs to safeguard confidential data from cyberattacks, unauthorized viewing and downloading particularly during crucial business transactions such as M&A deals.
For companies that want to safeguard their valuable intellectual property and confidential data, the advantages of using the secure VDR outweigh the risks that are associated with traditional file-sharing techniques such as email or cloud storage. Data leaks can cost companies time and money as well as damage to its reputation — and the best method to avoid a disaster is to adopt a comprehensive security program.
VDR security features include multi-factor authentication that allows users to identify themselves as well as granular permissions for controlling access to digital files and documents and audit logs to track the file’s activity. Regular backups of data ensure that the information stored in a VDR can be recovered even when the system fails or is the victim of a cyber attack.
If a company is looking for a VDR and is looking for one, they should opt for one that is able to use industry-leading encryption to scramble sensitive information while transmitting and provides a failsafe if an unauthorized user gains unauthorized access to the file or document. Advanced security measures, such as MFA and login monitoring to verify the IP address the device, location and IP address of a user can also be employed to prevent data breaches and other forms of security breaches.
Companies that are regulated by regulatory agencies such as the FCA should also ensure that the policies regarding data handling of their VDR provider are in line with the regulations. This ensures that any issues or complaints will be addressed efficiently and swiftly, which reduces the risk of legal complications and damage to the reputation of a company.
