The Balancing Act Between Security and Data Sharing

In 2007, the release of Apple’s first iPhone was met with admiration for what was new at the time – its multi-touch features. There was less focus on security than there is today, and specifically on the concept of one app sharing information with another, or of one device sharing with another. It just wasn’t part of the customer’s lexicon.

Well, much has changed in fourteen years. Now, not only is security and data protection top of mind at Apple and other tech companies, the opportunity to share has also grown substantially, with security choices now resting in the hands of the users, as they decide whether to share or not to share, and with whom.

Sharing is not always caring

Data sharing is a much more common practice today, and as a society, we’ve grown quite comfortable with giving away access to our information. If you have ever attempted to download an app, you have no doubt been asked permission to access your data. Even several applications and games targeting our children routinely request permission to overshare photos, microphone, video, etc.

And if we’re honest, most times we don’t have an issue with clicking “yes” to these requests, because we’ve learned that it’s sometimes the price we must pay for using these apps.

It’s always been interesting to me that in our personal lives, we seem to be much less regulated than what we would expect of a company we’ve given our data to.

This is important to keep in mind when considering the protection of client data.

Safeguarding our client’s information

In the wealth management industry, the opportunity to share client data must be weighed against the company’s responsibility to keep data secure, both directly and indirectly. We see this in different areas of our business, one of which is the customer relationship management (CRM) technology space.

As Advisors look for ways to increase collaboration, streamline processes and grow their businesses, modern CRM tools can provide both the financial and non-financial information an Advisor can use to gain a birds’ eye view of their clients’ current state, while also enabling them to anticipate future needs and provide better service.

Going back to the apps example, clients are likely comfortable with giving their personal information to us, but how comfortable are they with us sharing that information with a third-party partner, and how comfortable should we be?

Careful thought and consideration must be taken in these situations.

How we plan to move forward

Our responsibility to our clients means that our desire to provide the best possible systems must be balanced with the confidence in our partners’ ability to keep our client’s data safe, today and in the years to come. In the past, it was big companies with big systems that were coming up with big solutions; now, it’s much smaller companies and start-ups that are creating some really great products.

Although it’s not possible to manage agreements with hundreds of companies, we want our Advisors to have access to the best possible technology solutions. As a result, we will seek a mix of larger, established providers along with newer, agile start-ups to ensure Advisors have a choice that fits their individual needs.

Just as the iPhone has come a long way, and today provides users with a range of sharing choices, IPC and others like us will need to emulate that in our ecosystem. This doesn’t mean IPC is suddenly willing to give away data, but rather we will carefully choose the partners we are comfortable sharing data with, as we continue to meet our obligations to our Advisors and their clients.