The data stored in the Cloud is in a very real, geographic place, and those data centers can be exposed to real-world risk. Because of this risk, some businesses are turning away from the pure data efficiency play and are making data sovereignty a new priority.

What Is Data Sovereignty?

IBM defines data sovereignty as “Data stored and processed in the country where it was generated.” However, it clarifies that “data residency” is data that is stored in a different country from where it was generated. It adds a third term, “data localization,” which focuses on compliance with the laws and regulations in relation to data residency.

Data sovereignty isn’t the same as data residency. The latter is where your data physically lives in a data center. The former is the much more complex web of legal rules and restrictions that apply to your data. While often the same, the two can be very different, like if your data is in a European country but is under the jurisdiction of EU laws.

That’s why this is becoming such a big deal for businesses. If you don’t understand where your data lives and who has control over it, you’re leaving a key part of your business and its digital assets open to risks.

Why Sovereignty With Data Is a Non-Negotiable Now

The place data lives and the legal restrictions it exists under may feel like a side note to your day-to-day operations. But data isn’t in the sky. It’s in a physical location — and that infrastructure can be disrupted or targeted without you having any control over the situation.

Geopolitics, regulations, infrastructure risks—you name it. There are many ways physical data centers can be disrupted, and recent events have made this a very real potential issue. This is forcing business leaders to rethink their data policies.

Instead of the old focus that obsessed over what you’re going to do with data—including things like scale, speed and cost, leaders are now prioritizing location, control and jurisdiction. If you’re a leader, you should be taking this seriously, too. Stop prioritizing productivity and accessibility and turning a blind eye to the risks that third-party service platforms like Dropbox or Google Drive create. Instead, look for ways to bring your data back under your control.

What Businesses Can Do to Establish Data Sovereignty

Instead of leaving data sovereignty in the hands of third-party providers like OneDrive or Google, many businesses are turning toward hybrid and sovereign approaches for data management.

One way they’re doing this is by moving away from file-sharing platforms that offer limited control over data location, hosting infrastructure, or jurisdiction. Instead, they’re adopting Enterprise File Sync and Share (EFSS) solutions that support data residency, private-cloud, and self-hosted deployment requirements.

FileCloud is one example. The EFSS platform brings storage and governance in-house by letting businesses self-host or use region-specific clouds that they approve of. It also emphasizes governance through things like encryption and access controls and helps users align data governance policies with local regulations.

Along with data governance focused third-party on-prem and hybrid sovereignty models like FileCloud, companies can make internal efforts to map and classify all of their critical data. When you know where your sensitive data lives, you can classify it and ensure that, at the least, you understand the risks you’re taking.

Another option is to enforce geo-fencing rules. These are internal rules that define which countries or regions you allow your data to live in or be processed in. These rules are enforced by checking where a request comes from before allowing access. Geo-fencing then blocks or reroutes anyone attempting to transmit or copy your data outside of those boundaries.

Prioritizing Data Sovereignty

The utility of data is no longer the focus for forward-thinking business leaders. Sustainable data usage requires a clear understanding of data residency and steps to manage data sovereignty. When you ensure that your data is low-risk, it opens the doors to use it with greater confidence, knowing you are building a sustainable data-driven business model that can’t be upset by events happening half a world away.