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This chapter offers an in-depth guide on managing data security and privacy risks in IT sourcing. The guide emphasizes the importance of assessing vendors’ data security practices, which includes reviewing their security policies, verifying their certifications, investigating their history of breaches, conducting technical assessments, and evaluating their employee security training. Moreover, it provides insights into the implementation of data security measures like secure data transfer, strong access controls, regular security updates, effective incident response plans, and data security training. This comprehensive approach helps to ensure regulatory compliance and protects sensitive information from potential threats.