Data Room Security and M&A Due Diligence
When sharing sensitive information in the context of due diligence or other business transaction, security of the data space is a key aspect to consider. A virtual data room is a more secure alternative to sending sensitive documents by email. Email is not always secure enough.
There are many ways to improve the security of your servers and other equipment within a data center. They include biometric security scanners or a chain-link 12′ fence that is topped with razor wire, and a 24/7 security guard at the front gate. But, these types of security measures cost a lot and may not be suitable for smaller businesses.
To avoid costly errors and ensure security, administrators should be sure to scrutinize the access level and permissions of each user prior to inviting them to the data room. Ensure that the correct permissions are assigned for every individual and group and also consider enabling electronic signatures to prevent users from modifying or copying sensitive documents from the VDR.
It’s also a good idea to allow audit logs, SSO integration, two-factor authentication, and granular permissions. These features reduce the chance of human error and allow administrators to keep track of activities in order to detect possible leaks and abuse of the VDR.
It is vital to ensure your data is encrypted both in transit and in rest. This is essential for M&A due diligence, as sensitive information could fall into the wrong hands if released.
