PIA vs. DPIA: Understanding the Differences and When to Conduct Each
Scott Foote
Cybersecurity Executive, Board Advisor, CISO, Chief Privacy Officer/DPO, Chief Risk Officer, CAIO
As a Data Protection Officer (DPO) for several small businesses, ensuring compliance with privacy and data protection laws is a critical responsibility. Two key tools used in privacy risk management are the Privacy Impact Assessment (PIA) and the Data Protection Impact Assessment (DPIA). While both assessments help organizations identify, assess, and mitigate risks associated with processing of personal or personally-identifiable information (PI/PII), they serve different purposes and apply under different circumstances. Understanding the relationship between a PIA, a DPIA, and the concept of a privacy risk threshold is essential for ensuring compliance, reducing regulatory risk, and protecting customer trust.
What is a Privacy Impact Assessment (PIA)?
A Privacy Impact Assessment (PIA) is a broad evaluation of how an organization processes personal data and the potential privacy risks involved. PIAs are often voluntary (unless required by internal policies or regulations) and serve as a proactive approach to privacy management.
Key Features of a PIA:
1) Scope
Evaluates the privacy risks associated with any new or existing data processing activities, including websites, software, marketing initiatives, sales platforms, CRM, customer support, HR systems, or more recently online AI services.
2) Focus
General privacy concerns, compliance with privacy principles (lawfulness, transparency, data minimization, etc.), and the potential impact on individuals.
3) Requirement
Not legally mandated in most cases (consult your general counsel or outside privacy counsel), but considered a best practice for organizations committed to privacy.
Often contractually required by customers in B2B relationships where your organization is considered a "Data Processor".
4) Outcome
Identifies whether a higher risk threshold is met, triggering the need for a DPIA.
Getting started with a PIA will require establishing:
A PIA acts as a screening tool, helping organizations decide whether further risk analysis is required. If a PIA determines that data processing presents "high risks" to individuals' rights and freedoms, a DPIA becomes mandatory under GDPR (Article 35) or other relevant regulations.
What is a Data Protection Impact Assessment (DPIA)?
A Data Protection Impact Assessment (DPIA) is a legal requirement under GDPR and other data protection laws when processing activities pose a high risk to individuals' rights and freedoms. DPIAs are mandatory for high-risk processing activities and go deeper than a PIA by conducting a detailed risk assessment and mitigation planning. Not performing regular DPIAs will almost certainly result in a negative finding and significant penalties if your organization experiences a personal data breach. (NOTE: Having DFDs in place that include critical privacy and security controls is critical to an effective DPIA.)
Key Features of a DPIA:
1) Scope
Focuses on high-risk data processing activities, including automated decision-making, profiling, large-scale processing of sensitive data, and surveillance technologies.
2) Focus
Legal compliance, security risks, risk mitigation measures, and potential harm to data subjects.
3) Requirement
Mandatory under GDPR when a processing activity is likely to result in high risks.
4) Outcome
Identifies risks, proposes mitigation strategies, and determines whether processing should proceed or be modified.
The Role of a "Privacy Risk Threshold" in Determining When a DPIA is Required
A Privacy Risk Threshold is the criteria used in a PIA to evaluate whether a DPIA is necessary. If a PIA determines that data processing meets or exceeds a high-risk threshold, a DPIA must be conducted.
Common Privacy Risk Threshold Indicators:
If any of the above risk factors are present, the organization must conduct a DPIA to ensure compliance and minimize privacy risks.
Bottomline: When to Conduct a PIA vs. a DPIA
Why Small Businesses Should Care
Many small businesses mistakenly assume that DPIAs only apply to large corporations, but GDPR and other privacy laws apply to all businesses processing personal data. Conducting PIAs helps small businesses avoid unnecessary DPIAs while ensuring they only conduct DPIAs when truly necessary.
By implementing a structured PIA-DPIA process, businesses can:
Conclusion
Understanding the difference between a PIA and a DPIA is essential for CIOs, CISOs, and DPOs managing compliance risks in an era of increasing regulatory scrutiny. A well-structured risk threshold assessment within a PIA ensures that DPIAs are only conducted when truly necessary, balancing compliance obligations with business efficiency. Small businesses that take a proactive, risk-based approach to privacy assessments will be better positioned to navigate evolving data protection laws and maintain customer trust and regulatory compliance.
Annex A - Building a Data Processing Inventory
The key here is to start simply with a list of the PI/PII elements that your organization will either Collect or Process (or both).
Follow that by listing each type of "Processing" that will be performed on each element of PI/PII. This can be as general (e.g., "Used by Customer Service to contact individual customers when necessary.") or as specific (e.g., "Used to uniquely identify the individual when running a background or credit check.") as needed to get started. Starting with general processing activities is a good practice. That can always be followed with a more granular view of each type of processing if/as necessary.
For each type of processing activity in your Inventory, consider describing the following attributes of each individual activity:
Activity
Purpose
Nature of the Processing
Scope
Context
Necessity and Proportionality
Risks to the Data Subject(s)
#privacy #dataprivacy #privacyregulations #privacyrisk #dataprotection #dpo #pia #dpia #ceo #generalcounsel #cio #ciso #boardofdirectors #boardroom
Copyright ? 2025 Phenomenati – All Rights Reserved.
I Help CEO's at high growth, future focused companies to gain a competitive edge and grow revenues in excess of ￡25M by successfully delivering innovative IT, Digital and Data Transformations
5 天前Thanks Scott, As a Non-Exec of a publicly funded organisation Its so important to take a proactive approach to compliance - thanks for sharing
I help CEOs at international professional services companies reduce cybersecurity risk by 50% by building global information security programs and transforming IT teams.
5 天前Scott Foote Great explanation of the difference between a PIA and DPIA. I particularly like that you called out the value for small businesses. They often don't invest because of resource constraints but it is better to have the planned cost of a DPIA than the unplanned cost of a GDPR fine and all the legal costs that go with that.