In the context of exchanging data with third parties, Data Contracts play a critical role in ensuring security and compliance. They establish protocols for data management that promote responsible practices and alignment with legal and quality standards. This, in turn, diminishes risk for organizations and their external associates.
When organizations exchange data with external partners, there are risks of data breaches, non-compliance with regulations, and data quality issues.
Data contracts are binding agreements that outline data governance policies, security standards, and compliance requirements such as GDPR or HIPAA. They ensure that third parties handle the data appropriately and that the data exchanged adheres to legal and quality standards.
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