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What is shadow data? The dangers you can’t see

As organisations generate and manage vast amounts of data to fuel operations and boost customer experiences, a hidden threat continues to grow in the background shadow data. Unlike official data that is monitored and governed through enterprise systems, shadow data refers to information that escapes traditional controls. This includes records kept in unauthorised apps, data shared over unapproved cloud services, or files saved on personal devices.

Shadow data emerges from everyday work practices that prioritise convenience over compliance. In order to meet deadlines, employees may unintentionally bypass security procedures by using personal tools or platforms. The result is a complex web of uncontrolled data that increases exposure to breaches and compliance risks. To mitigate these dangers, organisations must recognise the scale of the issue and proactively address it.

What drives the growth of shadow data?

Many things are causing shadow data to grow, but one of the main ones is how many people use cloud services. These days, platforms like Dropbox and Google Drive are necessary for employees to share files and work together. Even though these tools are necessary for work, employees often set up their own storage systems that aren’t controlled by IT. Because data is handled in a decentralised way, it is not always clear where sensitive data is stored.

Another contributor is the culture of autonomy that exists in many organisations. Workers who are given the freedom to select the tools and methods they use to complete jobs may unintentionally violate regulations. This is especially true in flat-hierarchy organisations, where workers feel less constrained by conventional procedures. Combined with policies like “bring your own device” (BYOD), this freedom often results in critical data being stored in insecure or unmanaged environments.

Lastly, the problem is made worse by the fact that most people don’t know much about data governance. Many employees may unintentionally create vulnerabilities by using personal devices or third-party applications because they are unaware of the risks associated with shadow data. These behaviours continue without the right instruction and training, risking organisations.

The hidden dangers of shadow data

Shadow data introduces a variety of risks, starting with the higher possibility of data breaches. This data is an easy target for attacks since it is stored outside the scope of conventional security procedures. Sensitive data may be compromised as a result of unauthorised access to personal devices, unauthorised apps, or insecure cloud services. Such breaches can have catastrophic financial and reputational consequences.

Non-compliance with regulations like the CCPA, GDPR, or HIPAA is a further major issue. These frameworks require organisations to keep strict control over sensitive data, including where and how it is stored. Because shadow data is frequently overlooked by IT staff, ensuring compliance is extremely difficult. This can lead to severe penalties and damage an organisation’s credibility.

An additional consequence of shadow data is operational inefficiencies. Information fragmentation across multiple unapproved platforms leads to silos that interfere with decision-making and collaboration. Using inconsistent or insufficient data can lead to missed opportunities and bad business outcomes, which will only make the issue worse over time. Relying on inconsistent or incomplete data can result in poor business outcomes and missed opportunities, enhancing the problem over time.

How to mitigate the risks of shadow data

To address shadow data, organisations need to implement a multidimensional strategy. Putting together a good data governance strategy is one of the best things that can be done. To do this, clear rules must be made about how to access, use, and store data, and employees must be trained often to make sure they understand how important it is to follow the regulations. Building a mindset of accountability is one way for businesses to prevent shadow data from occurring in the first place.

Technologies are just as important as people when it comes to fixing this issue. Advanced data discovery tools can find shadow data on different devices and systems, which lets you see where weaknesses might be. Only those with the proper authorization can access sensitive information thanks to role-based access control systems. Encryption protocols and safe collaboration platforms may also help keep data safe while also making people more productive.

Organizations also need to conduct regular audits of their setting. These audits can help them find shadow data, figure out how critical it is, and decide whether it needs to be added to official systems or removed completely. From that quick file upload to an unapproved cloud service to sharing sensitive information on a platform outside of IT’s watchful eye, how often do these small choices add up to bigger risks? Perhaps it’s time to reflect on the unseen consequences of these actions and the vulnerabilities they leave behind.

Kristi Shehu is a Cyber Security Engineer (Application Security) and Cyber Journalist based in Albania. She lives and breathes technology, specializing in crafting content on cyber news and the latest security trends, all through the eyes of a cyber professional. Kristi is passionate about sharing her thoughts and opinions on the exciting world of cyber security, from breakthrough emerging technologies to dynamic startups across the globe.