When crucial decisions are being taken, such as a merger acquisition or capital raising, there is often the need for outside third parties to scrutinize a company’s documents. This could mean scouring through thousands of confidential documents. To allow this to occur without risking a data breach and creating a compliance violation, businesses must use a virtual data room.
Often called VDR, a secure data room makes it simple for users to view and access sensitive data securely online. With top security features and a strong encryption, an VDR is the ideal solution for transactions in business that require to be secured.
A secure data room allows for efficient collaboration, allowing several participants to work on projects simultaneously. It makes it easier to manage processes like documents and Q&As which makes due diligence easier.
However, most 'secure' data rooms use an outdated model of login and passwords to secure documents. Any system that doesn’t prevent authorized users from sharing their login credentials (and consequently your documents) is not suitable for the use. Most of the time these systems make big claims about their security using terms such as 'the most secure data room”, „highest degree of security', etc – which is just marketing guff.
A true secure data room employs an ISO 27001 certified system that gives access to users with granular permissions dynamic watermarking, two-factor authentication, and more to prevent document breaches in real-time. It also ensures that every user activity is recorded and tracked to allow auditing. This is the only method to ensure that documents are secure when shared with an outside party.