"Accelerating privacy regulations" has overtaken talent shortages as the number one most concerning risk to businesses in 2019, according to Gartner.
In the latest quarterly survey of decision makers across the world, the analysts found that privacy regulations are being viewed as more burdensome and costly than ever before.
Matt Shinkman, managing VP and risk practice leader at Gartner, said that for many, the encroaching deadline of the California Consumer Privacy Act - due to take effect on January 1 2020 - is an unwelcome wake up call.
"With the General Data Protection Regulation (GDPR) now in effect, executives realise that complying with privacy regulations is more complex and costly than first anticipated," he said.
"More budget dollars from IT, legal and information security are going to address GDPR compliance, just as the California Consumer Privacy Act (CCPA) is set to take effect, adding another layer of complexity for companies to navigate in this area."
Concerns over consumer privacy have peaked in recent years.
High profile breaches such as the Equifax leak in 2017 have eroded consumer trust in companies, with lawmakers taking note.
In the US, the CCPA is modelled on the EU's GDPR, and will grant new rights to citizens over their data.
While welcomed by many, Gartner notes that for businesses, an increasingly fragmented, complex privacy regulation landscape is emerging.
New legislation has also recently been introduced in Australia and Japan.
"We are now seeing an evolution from GDPR-specific concerns, which have been on executives' minds for the past couple of years, to a broader recognition that their organisations need to overhaul their entire data security governance strategies," Shinkman added.
"GDPR compliance is really just the starting gun in this process, and not the finish line."
The other top threats rounding off the top five concerns for businesses according to Gartner are, the pace of change, the growing talent shortage, falling behind in digitalisation and misconceptions around the need for a digital transformation.
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