8 encryption key management best practices to protect your data

Storing and accessing information about your business, employees, and consumers is essential for streamlined day-to-day operations and frictionless customer experiences. 

That said, access to data comes with the responsibility to secure and protect it from outside consumption or tampering. As a cornerstone of cybersecurity, encryption helps prevent data breaches and make your data unreadable to attackers who gain access to your network. 

And Liquid Web’s Private Cloud powered by VMware can further protect your data.

If you want to get the most out of cryptographic processes, you need to have the right practices and policies in place to maintain the balance of ensuring that encrypted data remains accessible to those who need it and securing it from anyone else. 

Here’s what we’ll cover:

• The role of encryption in protecting sensitive data
• Encryption keys and the importance of key management in effective encryption
• Encryption key management best practices
• Final thoughts: 8 encryption key management best practices

The role of encryption in protecting sensitive data

Encryption is an essential tool for protecting sensitive data — or any data, for that matter — as it ensures that data remains unreadable to unauthorized users and prevents tampering. You can use encryption to secure data that’s stored on premises or in the cloud. Equally crucial is the use of encryption to maintain the integrity of your data by preventing tampering during transit or processing. 

Encryption keys and the importance of key management in effective encryption

Cryptographic keys are used to encrypt and decrypt your data, which helps ensure that only the people authorized to view and edit information have that access. Encryption keys also secure data transfers between entities and verify digital signatures.

The two main types of cryptographic algorithms are:

• Symmetric encryption (or private key encryption) uses the same key to encrypt and decrypt information. This is frequently used for data transmission.
• Asymmetric encryption (or public key infrastructure) uses two related keys, one public and the other private. Typically, the public key encrypts the data, and the private key is used by the individual decrypting it. Asymmetric cryptography is often used to protect and share the keys used in symmetric encryption.

Because keys enable data protection, authorized information access, secure transfers, and authentication, managing them properly is crucial to the encryption process. When surveyed, 59% of IT and IT security professionals said that managing encryption keys significantly impacts their businesses. To understand the importance of key management, it’s helpful to look at what happens when it goes wrong.

Consequences of poor key management

Poor key management can make it difficult to decrypt information, interrupting operations and leading to expensive data recovery processes. If you’re not properly managing encryption keys, you can end up with fines and fees for not complying with encryption guidelines that may apply to your company, like the General Data Protection Regulation (GDPR) or the Health Insurance Portability and Accountability Act (HIPAA).

Mismanagement of keys can also compromise the security of your encrypted data by giving unauthorized people access to protected information.

When a key becomes compromised, an outside entity can:

• Impersonate someone in your organization.
• Read your encrypted documents, messages, or emails.
• Access, extract, or manipulate the data you store on your server.
• Sign electronic documents on behalf of someone in your organization.

If your company experiences a data breach, you can incur financial losses and reputational damage that can negatively impact your ability to win and keep customers. As such, it’s essential for IT and IT security teams to implement effective key management as part of their regular processes. 

That said, 89% of cybersecurity personnel list cryptography as an area that requires skill improvement. For those looking to improve overall security, here are eight on-premise and cloud encryption key management best practices to implement for optimal encryption performance.

Encryption key management best practices 

• Document and enforce key management policies.
• Limit keys to a single purpose.
• Don’t hard code keys.
• Consider hardware security modules (HSMs) for key storage.
• Use key management systems (KMSs) to automate tasks.
• Conduct regular audits.
• Create a disaster recovery strategy.
• Inventory your keys and document usage.

Document and enforce key management policies

Creating a centralized key management policy can help ensure the proper handling of keys. Your policy should clearly outline who is responsible for each key lifecycle management stage, from creation and activation to expiration and destruction. It should also define key access controls, which dictate who can use and manage each key at different stages.

In addition to roles and responsibilities, your key management policy should dictate how your team uses and manages keys. For example, you can specify when certain keys can and can’t be used. You can incorporate the rest of these best practices into your company’s policy as guidelines for properly handling keys. 

Once you’ve created the policy, you should enforce it, which starts with training your team on the instructions and then monitoring to ensure everyone is complying with the guidelines.

Limit keys to a single purpose

Data encryption keys are used for encryption, decryption, authentication, digital signatures, and protecting other keys (also known as key wrapping). That said, you should limit each key to a single purpose rather than using one key to achieve multiple goals.

When each key has one purpose, it simplifies management, as it’s easier to adhere to the best practices around key length and rotation period based on its intended use. This also increases security because reusing one key for different purposes can expose you to more vulnerabilities. Single-use keys are more isolated and provide better data protection.

Don’t hard code keys

Embedding keys into the source code of your programs or configuration files adds unnecessary risk and complexity to your key management process. First and foremost, if hackers can access your source code, this gives them access to the key. It can also make it more difficult for you to detect breaches. 

Beyond that, hard coding means you’ll have to edit your source code every time you rotate keys. This makes key management more labor-intensive, as you must redeploy your application more frequently. At the bare minimum, keys should be stored in separate files or as environment variables to separate them from your source code and reduce the risk of exposure.

Consider hardware security modules for key storage

Instead of using software to store keys, consider opting for hardware security modules (HSMs), which are physical tools designed for securing key materials. Because keys are stored and used within the HSM and not exported, this reduces your overall exposure risk. 

Because HSMs are explicitly built for cryptographic operations, most offer benefits like tamper-resistant features, adherence to the latest recommendations for key generation, and compliance with regulatory standards. They’re also designed to enable faster encryption, decryption, and authentication, helping optimize the performance of systems that rely on encryption.

Use key management systems to automate tasks

Key management systems (KMSs) are network services that facilitate the management and use of encryption keys in a secure environment. These systems are essential cybersecurity tools for most organizations, and 52% of professionals report using at least five key management solutions to effectively manage data encryption keys across various environments.

HSMs back many KMS solutions, and using them together is an excellent way to enable secure and efficient key management. You can streamline your key management by using a KMS to automate tasks in the key lifespan, including generation, backup, rotation, and destruction. Automating these key activities reduces the risk of manual error and keeps the lifespan running smoothly for all keys across your organization.

Conduct regular audits

Auditing your key management processes annually helps you enforce your company’s policies and procedures. As a result, you can limit exposure and reduce the risk of any keys becoming compromised and leading to a data breach.

Conducting audits also allows you to ensure that your policies and procedures remain effective and up to date. You can get feedback from your team about any unclear, outdated, or inefficient guidelines and take steps to improve them.

Create a disaster recovery strategy

Disaster response and data recovery should be outlined as a part of your key management procedures. Start by identifying the types of threats you may face and understanding the potential impact of each one. 

From there, define your key backup strategy. Focus on where to store backups and how often to back up each key automatically. Your recovery strategy should also include instructions on how to restore and verify keys from your backups before using them.

If you want to test the effectiveness of your plan, you can perform disaster drills and see if there are areas of the strategy that need improvement.

Inventory your keys and document usage

A comprehensive inventory of your keys is especially useful when conducting audits and responding to disasters. 

Because of this, it’s important to maintain and update your database of key information and metadata, including:

• Key name.
• Description of the key’s purpose.
• Key length, size, and algorithm type.
• Creation, expiration, and rotation dates.
• Storage details and location of backups.
• Users who are authorized to access the key.
• Person or department who owns the key.

You can also group keys by their priority level in a recovery situation so your team knows where to focus their time if there’s a disaster event. In addition to the inventory, you want to keep up-to-date access and usage logs to inform audits. These logs can detail who used the key, when they used it, and what information they accessed.

Final thoughts: 8 encryption key management best practices

Because keys play such a vital role in encryption, understanding how to manage them effectively in your organization is a must for protecting sensitive data. Successful management starts with a well-defined central strategy with clear policies around each stage of the key lifecycle. 

From there, you want to monitor key usage, audit for threats, and keep up with the latest cryptography recommendations. You can protect your data further with Liquid Web’s private cloud hosting, which gives you total control over your data and lets you customize your security measures.