Why “Digital Sovereignty” Matters Even for Small Businesses | Blog

Imagine waking up in the morning to the jarring realisation that a hacker’s been inside your systems, exporting customer data to who-knows-where and demanding a ransom – or worse, that your cloud provider gets hit with a legal request from a foreign government under some law you never even knew existed. For many small and medium businesses (SMBs), this is an all-too-real nightmare that’s not going away.

In fact, a survey conducted in 2025 found that a staggering 43% of all cyberattacks were aimed at small businesses.

Almost half of those who got caught in the cross-hairs reported losing vital data.

Tragically, around 60% of small businesses that were forced to deal with a serious cyberattack ended up shutting down permanently within six months.

If you run one of these SMBs, that means having control over your data, systems, and digital infrastructure is not a luxury; it’s a necessity.

In this article, we’re going to explain what digital sovereignty is, why small businesses need it, and give you some practical steps to help you achieve robust SMB data protection and privacy.

What Is Digital Sovereignty (and why does it matter for SMBs)

Digital sovereignty is about keeping a tight grip on your own data, systems, and digital infrastructure – rather than blindly trusting them to external, often foreign , cloud providers. For SMBs, that means being in charge of:

• Deciding where your data gets stored (i.e. which country, which jurisdiction).
• Controlling who has access to it and under what circumstances.
• Being able to switch to a different provider if you need to, rather than getting locked into a contract with a big provider that’s got its own agenda and who-knows-what data-sharing obligations.

This matters more than ever. As it happens, many European SMBs are now making IT security and data protection top priorities when they’re digitizing their operations.

And asserting digital sovereignty can actually be a big competitive advantage for you. It helps build trust with customers, partners, and regulators – especially in industries that deal with sensitive personal data (e.g, health, finance, legal).

The Risk Landscape for SMBs: why SMB data protection really is critical

Here’s a snapshot of some key numbers that show just how vulnerable SMBs are today:

These numbers paint a pretty grim picture, but they also highlight just why SMB data protection, small business privacy and digital sovereignty need to be right at the top of your list of priorities

How SMBs Can Build Digital Sovereignty – with practical steps

Becoming digitally sovereign doesn’t have to cost a fortune. Many of the most effective measures are pretty straightforward – and if you implement them early on, you’ll be ahead of the game.

Build a basic security foundation

• Develop a security policy that’s clear and concise – even a simple one will do. Define who can access what data, and under what circumstances.
• Make sure you’ve got regular backups – ideally, offline or to servers you control. That way, you’ll be able to recover if your cloud storage goes down or gets compromised.
• Use strong authentication – enforce long, unique passwords, and where possible, multi-factor authentication (MFA). That way, you can be sure that only the right people get access to your systems.
• Train your people – human error is the biggest cause of breaches. Periodic refresher training on phishing and best practices can cut the risk of getting hacked.

Choose where and how to store your data

Rather than defaulting to some big public-cloud provider, take a closer look at options like:

• On-premises servers – that way, you’ve got full control over the hardware, software, and data.
• Sovereign/regional cloud – cloud services managed under your own jurisdiction’s laws, in some cases run by local providers.
• Hybrid approaches – a mix of on-site critical data storage with cloud-based applications.

Each has its trade-offs in cost, complexity, and control, but sovereignty-minded firms often go for what gives them the greatest control over data flow and compliance.

Implement protective technical measures

• Use encryption at rest and in transit – that way, even if your data is intercepted or misused, it’s still going to be unintelligible to anyone trying to access it.
• Deploy endpoint protection on all devices (laptops, phones, tablets), including antivirus, firewall, and device encryption. Most SMBs don’t yet do this.
• Regularly audit access logs and permissions – especially if there’s been a change in staff or roles.

Plan for incidents: backups and recovery

• Maintain offline or external backups, ideally with versioning and regular testing.
• Have a basic incident response plan – for example, what to do in case of ransomware, unauthorized access, or data leak.
• Consider cyber insurance, especially if you handle customer personal data or financial information.

Building a Culture of Compliance and Transparency

• If you’re open and upfront with customers and partners about how you store and protect their data, it can make a big difference – it helps build trust.
• For European SMBs, the reality is that compliance with regulations like GDPR often makes digital sovereignty more attractive.
• Think of data protection as a strategic asset, something that sets you apart from others, rather than a hassle or a burden.

Why Digital Sovereignty Matters for Small Business Privacy

By pulling control back over your data and infrastructure, SMBs can ensure:

• You have control over where your data sits – if you only store it in countries that comply with your local laws, that minimises the risk of a foreign government coming in or forcing you to share it.
• You know exactly who is responsible – there’s no mystery about what’s going on behind the scenes, you can see what’s happening, and you have control over access and security.
• You get better visibility and auditability – when it’s your data and your systems, you can really keep an eye on who’s accessing it, what changes are being made, and where potential leaks could come from.
• You avoid the risk of getting locked in – cloud providers can go under or change the rules on you – with your own infrastructure, you’re not at their mercy.

In short, digital sovereignty does a lot to support both SMB data protection and small business privacy, which are two increasingly important factors for customers, regulators, and partners to consider.

Common Challenges SMBs Need to Overcome

Conclusion

For small and medium businesses, digital sovereignty isn’t just some buzzword – it’s a matter of survival. Given the number of cyberattacks on SMBs, the cost of breaches when they do happen, and the fact that many of these incidents come down to some basic human error or a misconfigured cloud service, having control over your data and infrastructure is a must.

If you put even a bit of money into getting your security in order – strong policies, backups, encryption, access control – you can improve your resilience a lot. And by choosing where and how to store your data, you get better compliance, transparency, and long-term stability.

If you want to dive deeper into practical deployment strategies and learn how to choose between public cloud, on-premises, or a sovereign (regionally controlled) cloud for your business, check out our follow-up article Choosing the Right Deployment for Your Email Server: Public Cloud, On-Premises, or Sovereign Cloud? It explores how different deployment models impact control, security, and compliance.