A virtual data room is where companies can save and share sensitive documents with trusted third parties which reduces the risk that sensitive business data could be leaked to unauthorized individuals. Traditionally, due diligence happened in physical rooms, however nowadays, it is conducted online in what are called virtual data rooms (VDRs).
The best VDRs provide security-first features that help reduce the risk of data breaches and illegal sharing. These include granular access control and multi-factor authentication as well as session timeouts. They also include security restrictions on location, secure spreadsheet viewers, as well as the ability to watermark and block screenshots. All of these create a robust digital fortress around the data stored and shared in the VDR which can help organizations achieve compliance with regulatory requirements and establish trust with their customers.
When choosing an encrypted data room it is crucial to make sure that the choice is really suited for the task and does not just permit authorized users to log in and share your data on different platforms. Many “secure” systems claim that they stop this, but the fact is that they don’t they simply decrypt your files on the server before delivering them to your browser.
They depend on your browser to have a certificate and being set to only accept certificates from trusted sources. It doesn’t mean your VDR is safe from hacking, however it does ensure that hackers are only able to gain access to your encrypted data and not your unencrypted, temporary files.