When companies experience a data leak, it’s important for them to be transparent and proactive about the issue. Communicating with customers, investors and employees about what happened can limit frustration and questions in the aftermath of a breach and save time and money in the long run.
A data leak is the unintentional exposure of sensitive information to an unauthorized environment. This can happen when cybercriminals exploit security vulnerabilities, when companies mismanage their cybersecurity infrastructure and policies, or when employees make a simple mistake—like sharing confidential files with the wrong team.
Whether intentional or not, data leaks put consumers at risk of financial loss, identity theft and reputational damage. They can also allow hackers to steal login credentials and use them to access other accounts—a technique known as credential stuffing—because many people reuse the same passwords across multiple sites.
A data leak can also expose trade secrets and other confidential information that is critical to a company’s growth and future. These include detailed business plans, product roadmaps, engineering documents, documentation for scrapped or unfinished projects, and source code for proprietary software and technology. The loss of this information can have a devastating impact on a company’s innovation and competitiveness. Additionally, if the compromised data includes PII or credit card information, the organization may face heavy fines and a loss of consumer trust.