Over the last decade, data has become the lifeblood of countless businesses across the world. It’s the foundation for winsome customer experiences, the fuel behind innovative R&D, the key to excellent value propositions, and the lodestar for wise C-level decision-making.

And for the vast majority of organizations, that data now resides in the cloud. Whether public, private, or hybrid, that means most organizations are now entrusting third-party providers to run the physical infrastructure that houses their most valuable assets. At the same time, it’s crucial that companies retain control over the way the data on that physical infrastructure is managed. Ownership of data comes with risk, and breaching compliance comes with heavy penalties for organizations.

Implementing an effective cloud sovereignty model is a key way to protect a company’s data and operations – which in turn will ensure those operations are efficient and uninterrupted.

What is cloud sovereignty?

First things first: If the goal is control over data, what does that actually entail? In essence, the term ‘cloud sovereignty’ refers to an organization's ability to control its data, applications, and infrastructure within the cloud while ensuring compliance with local and international regulations. That can be broken down into three areas.

First, data sovereignty, which involves the organization ensuring its data remains under its direct control while adhering to the legal frameworks of the regions where the data is stored. Second, operational sovereignty, which essentially means maintaining full oversight and control over the business’s cloud-based operations. And third, technical sovereignty, which means the organization can operate its applications and workloads without relying on a single cloud provider.

When all three of these areas are achieved and maintained, businesses are likely to be operating a full ‘cloud sovereignty’ model – with direct control over their data, systems, and the digital backbone that keeps them running.

What are the key challenges to overcome?

Sounds good, right? But also complex, to say the least, and there are several key challenges businesses need to overcome on the road to cloud sovereignty.

One challenge is that of cross-border data transfers and compliance. Regulations like GDPR impose strict restrictions on the flow of data between regions, particularly between the EU and non-EU countries like the United States, and can create compliance conflicts for organizations operating in more than one jurisdiction.

Additionally, the increasing adoption of multi-cloud environments and edge computing means data governance now goes far beyond the cloud to a whole raft of different platforms and infrastructures, which makes cloud sovereignty and compliance exponentially harder.

And that's before we mention the simple fact that compliance also costs a lot of time and money.

Nine steps to top-flight cloud sovereignty

So, with all this in mind – the urgent need to achieve cloud sovereignty to support compliance, and the difficulties involved in achieving it – what steps should businesses take to build an effective cloud sovereignty model?

1) Run a data audit

A data audit is the best place to start. Businesses should proactively evaluate the locations and pathways of data storage, processing, and transmission. This helps identify vulnerabilities and ensures alignment with evolving data protection frameworks, reducing risks to data sovereignty. For example, organizations can map data storage, processing, and transmission to ensure compliance with local regulations.

2) Store data where it originates

It’s also important to store data within the jurisdiction of its origin, allowing you to safeguard sensitive information under local laws, streamline compliance with regulations, and minimize your legal risk in an increasingly complex global landscape.

3) Control access tightly

Cybersecurity is obviously crucial to any cloud model. Businesses need to adopt measures including encryption, rigorous access controls, and real-time monitoring, protecting against unauthorized access and ensuring compliance with industry-specific regulations. For example, in healthcare, these measures are used to protect patient records and comply with HIPAA.

4) Make your data protection dynamic

Organizations need to make sure they have an adaptive data protection policy governing the management of sensitive information. This will be continuously refined and updated to stay ahead of regulatory changes and industry best practices.

5) Use providers that do custom data residency
It's important to select cloud partners that offer customizable data residency options. This flexibility empowers organizations to meet diverse regional requirements while maintaining control over where data is stored and processed.

6) Develop a global governance framework

Most regulations mandate this anyway, but enterprises should hyper-focus on crafting and implementing a comprehensive governance model for managing data across cloud ecosystems.

7) Go multi-cloud

Building a multi-cloud strategy means data management is diversified across multiple vendors. This enhances operational resilience, provides greater flexibility, facilitates compliance with regional data laws, and avoids vendor lock-in.

8) Accelerate compliance with AI and automation

AI-driven solutions can massively speed up repetitive tasks like compliance monitoring, data flow management, and real-time risk detection – at the same time, reducing human error, increasing efficiency, and ensuring that organizational data practices remain audit-ready.

9) Team up with compliance experts

Why have a dog and bark yourself? Businesses should opt for cloud providers that specialize in navigating the complex compliance landscape, giving them the expertise and solutions needed to confidently manage regulatory challenges without stifling innovation.

By prioritizing cloud sovereignty, businesses can turn compliance into a competitive advantage—balancing control, innovation, and resilience to thrive in a data-driven economy. The strategies outlined above provide a clear roadmap to safeguard data, streamline operations, and navigate complex regulations with confidence. nage regulatory challenges without stifling innovation.