In most organisations today, data is one of the most valuable assets, yet it is also one of the most difficult to control. Even with well-managed official systems, a parallel world of untracked, unmanaged, and unmonitored data often exists, also known as shadow data. Previous articles of mine cover Shadow IT and Shadow AI. In contrast, shadow data is sensitive or business-critical data that has slipped outside approved processes and governance controls.
Shadow data exists outside sanctioned systems, controls, and oversight. It typically arises because people prioritise convenience, speed, or workarounds over policy. The problem is not that the data exists, but that it is often invisible to those responsible for protecting it.
Forms of shadow data
- Unapproved copies of sensitive data. An analyst downloads customer records into a spreadsheet. The official database is secure, but the spreadsheet is not.
- Data in unsanctioned apps, such as the use of personal cloud storage or messaging tools to share files instead of company-approved platforms.
- Orphaned backups or snapshots. Forgotten database snapshots or cloud storage remain open long after they are no longer needed, often with excessive access rights.
- Forgotten test and development data. Developers copy production data into test environments. These environments often lack the same protections as live systems, yet they still contain sensitive details.
Why shadow data matters
- Shadow data is often outside encryption, access controls, or monitoring. Attackers will look for weak links, such as laptops, shared drives, or forgotten cloud storage.
- Regulations such as GDPR require organisations to know where personal data resides. Shadow data undermines these compliance efforts and may lead to fines or sanctions.
- Duplicate datasets lead to inconsistent reporting, poor decision-making, and unnecessary storage costs.
- In the event of a breach, businesses may underestimate the scope because they are unaware of hidden datasets.
Working examples
A hospital stores patient records in a secure, encrypted database, but:
- A doctor, needing to work quickly, exports patient details into a spreadsheet
- Copies of data not under hospital control
- Sensitive health data across multiple insecure locations
- Introduction of compliance, legal, and reputational risk
A law firm manages client files in a secure document management system, but for convenience, solicitors, partners, trainees, or other staff:
- Save case files to USB or laptop drives
- Email document bundles through public email systems
- Collaborate through personal Dropbox or OneDrive accounts
Shadow copies of data may contain privileged client data. If a laptop is lost or if a client requests data deletion, the firm cannot ensure removal of these unofficial copies. What began as minor workarounds now represents serious compliance and reputational risk.
While shadow data often arises from legitimate needs, it introduces risks that can outweigh the convenience. For businesses bound by regulation, trust, and professional duty, shadow data can quietly erode compliance and expose sensitive information. One quick copy can multiply into a long-lasting vulnerability. Bringing shadow data into the light is no longer optional.
Information security, risk management, internal audit, and governance professional with over 25 years of post-graduate experience gained across a diverse range of private and public sector projects in banking, insurance, telecommunications, health services, charities and more, both in the UK and internationally – MORE