Risk analysis in the context of the GDPR includes several steps that can be divided into the following stages:

• •Preparing the context of data processing and risk: This stage requires identifying and describing the operations and purposes of personal data processing. Managers of the various departments in the organisation should receive an operations description sheet and instructions on how to complete it. Workshops with heads of organisational units can also be held to help them understand how to correctly complete the sheet.
• •Analysis of processing operations: The second step is to carry out an analysis of the processing operations in terms of compliance with GDPR requirements. It is necessary to assess whether the processing operations are necessary and proportionate to the purposes. It is also worth conducting an audit of the processing operations’ compliance with GDPR requirements.
• •Measurement and analysis of risk: This stage involves estimating the likelihood of the defined threats occurring, as well as determining the value of the consequences of their occurrence.
• •Estimating the likelihood and determining the value of probable losses: When assessing the likelihood of a threat occurring, for example, a scale of 1 to 4 can be used, where 1 means there is no real chance of the threat occurring, and 4 means the threat is real or very real. Consequences may include loss of control over personal data, restriction of rights, discrimination, theft or falsification of identity, financial loss, unauthorised re-identification of pseudonymised data, damage to reputation, breach of the confidentiality of personal data and professional secrecy and any other significant economic or social harm. It is recommended to use a combined, i.e. quantitative-qualitative, approach to estimating likelihood and impact. This is an approach in which numerical values are assigned to risk assessment elements while simultaneously describing and classifying potential consequences.
• •Risk evaluation: Involves comparing the results of the risk analysis with risk criteria to determine whether the risk or its magnitude is acceptable or unacceptable.
• •Risk treatment: After assessing the risk, steps can be taken to modify the risk. This may include accepting the risk, avoiding the risk, monitoring, reducing the level of risk, or sharing the risk with other parties.
• •Informing and consulting on risk: This is a continuous process of providing, conveying or obtaining information about risks. Effective communication is crucial for the proper functioning of the risk management process and decision-making.

All these steps should be appropriately documented, and the risk analysis process should be cyclical, because risks and the ways of managing them may change over time.

A risk analysis should be carried out at the outset of every new organisational, technical or business initiative that involves the processing of personal data, in order to understand what risks may arise from that activity.

A risk analysis under the GDPR is a process aimed at assessing and understanding the risks related to the processing of personal data. In particular, it should include the following elements:

• •Context of data processing: The processing operations and purposes should be described in detail. This should include the types of data being processed, how they are stored, who has access to them, how they are used and for what purpose.
• •Identification of threats: Potential threats to personal data should be identified and described; these may arise from various sources, such as cyberattacks, human error, system failures, etc.
• •Assessment of likelihood and impact: Each threat should be assessed in terms of the likelihood of its occurrence and the potential impact on the rights and freedoms of the data subjects. This includes estimating both the probability of a given event occurring and the potential harm that could result from such an event.
• •Determination of the level of risk: Based on the assessment of likelihood and impact, the overall level of risk associated with each threat should be determined.
• •Recommendations for risk management: Based on the level of risk, recommendations for risk management should be presented. These may include various measures such as technical safeguards, management procedures, staff training, etc.
• •Risk evaluation: The risk analysis should also include a risk evaluation that compares the results of the risk analysis with risk criteria to determine whether the risk is acceptable or requires further action.
• •Communication and consultations: The risk analysis process should also include communication and consultations with key stakeholders such as employees, customers, regulators, etc.
• •Monitoring and review: The risk analysis should be an ongoing process that is regularly monitored and updated to take account of new threats, changes in the way data is processed or changes in the law.

All of the above elements should be appropriately documented, and the entire process should be conducted in a transparent manner and in accordance with GDPR requirements.

Failure to carry out a risk analysis under the GDPR may lead to a range of consequences, both direct and indirect:

• •Financial penalties: the GDPR provides for severe financial sanctions for non-compliance. Depending on the nature of the breach, fines can amount to up to €20 million or 4% of the company’s global annual turnover, whichever is higher.
• •Reputational risks: a personal data breach can seriously damage a company’s reputation. Customers may lose trust in the company if they consider that their personal data are not being adequately protected.
• •Legal consequences: beyond regulatory financial penalties, organisations may also be held legally liable by individuals whose rights have been infringed.
• •Loss of business: if customers consider that an organisation does not comply with the GDPR, they may choose to terminate cooperation in favour of more reliable contractors.
• •Incident-related costs: in the event of a data protection breach, an organisation may incur significant incident-related costs including, among others: costs of communicating with affected individuals, legal fees, technological costs related to remediating security vulnerabilities and costs associated with restoring the company’s reputation.

A risk analysis should be carried out regularly, however there is no specific schedule that determines how often a risk analysis must be performed, as this will depend on the specifics of the organisation, the types of data it processes and the sector in which it operates.

Good practice suggests that risk analyses should be conducted at least once a year, or more frequently depending on the nature of the activity. It is also important to conduct a risk analysis when significant changes occur in the organisation, such as the introduction of new systems, changes to data processing procedures, the launch of new products or services that may affect personal data, or in the event of a data protection incident.

All of this should form part of a continuous risk management process within the organisation.

Yes, the requirements of the GDPR apply to all organisations processing the personal data of European Union citizens, regardless of their size. This means that small companies must also carry out risk analyses related to the processing of personal data in order to understand and minimise potential threats to the privacy of the data subjects.

Various tools can be used to carry out a risk analysis under the GDPR. The choice of a specific tool will depend on many factors, such as the size of the organisation, the types of personal data processed and the maturity level of the data protection programme.

An example of a tool could be a spreadsheet (e.g. in Excel), which takes into account different types of risk, the likelihood of their occurrence and potential consequences.

It is also possible to use dedicated risk management tools that can help to conduct and document risk analyses systematically. Such tools often offer additional features such as tracking changes in risk, generating reports and integrating with other management systems.

A risk analysis under the GDPR should be carried out by the persons responsible for data protection in your organisation. Here are examples of different people who may be involved in this process:

• •Data Protection Officer (DPO): if your organisation has appointed a DPO, this person will have primary responsibilities for conducting the risk analysis. The DPO is responsible for monitoring GDPR compliance, and risk analysis is a key tool for that purpose.
• •Management: involvement of senior management is often required, particularly where the risk analysis may affect strategic decisions regarding data processing.
• •IT team: the IT team will often be involved, as the risk analysis includes assessment of technical threats such as cybersecurity.
• •Compliance team: if one exists, it should be included in the process of conducting the risk analysis or in supporting the DPO in this process.

Companies may decide to obtain external support, such as data protection experts, to assist in conducting the risk analysis, particularly if they lack appropriate resources or specialised technical knowledge.

Assessing the effectiveness of a conducted risk analysis helps ensure that the analysis is accurate, up to date and that the implemented mitigating measures are effective. The effectiveness of the analysis can be verified through a number of activities:

• •Documentation and review The first step is to ensure that all aspects of the risk analysis are properly documented, including the processing context, identified threats, risk assessment and recommended mitigating measures. Such documentation should be reviewed and updated regularly to reflect any changes in the processing context or newly identified threats.
• •Verification of implementation of mitigating measures: After the necessary mitigating measures have been identified, it is important to verify that they have been correctly implemented. This may include an audit of technical security measures, a review of policies and procedures, as well as staff training.
• •Testing and audits: The effectiveness of the risk analysis and the implemented mitigating measures can also be assessed through regular tests and audits. This may include penetration testing of IT systems, GDPR compliance audits, as well as simulations of crisis situations, such as data protection incidents.
• •Assessment of incident response: If any data protection incidents occur, such as security breaches, those incidents should be analysed to determine whether the prior risk analysis correctly identified the risk, how effectively the incident was handled and whether additional mitigating measures are required.
• •Feedback and consultations: Feedback from other stakeholders, such as employees or customers, can also provide valuable information on the effectiveness of the analysis.

The assessment of the effectiveness of the risk analysis should be an ongoing process, not a one-off action. Regular reviews and updates are key to maintaining an effective data protection risk management process.