TLDR* May Work for EULAs But Your Contracts?

Time is a luxury few of us can afford to waste. Decision-makers often find themselves sifting through mountains of information, juggling priorities, and racing against deadlines. This urgency has bred a culture that leans heavily on taking shortcuts. It’s not uncommon to see individuals skimming emails, dumping documents into AI, or, worse yet, taking the “too long; didn’t read” (TLDR) approach. While this strategy might be acceptable for the endless scroll of user license agreements (EULAs), it is a dangerous practice when it comes to legally binding contracts. And the consequences? They could be career-defining.

The Devil’s in the Details

Contracts are more than just documents filled with jargon—they are a maze of obligations, risks, and liabilities. Every clause, sub-clause, and footnote carries weight, often designed to safeguard the interests of the party drafting it. This inherent bias means that overlooking a single sentence could mean trouble. Consider, for example, a contract clause that stipulates breach notification within “24-hours of discovery”. Such a requirement may sound simple enough in passing, but if your organization’s internal processes or technology can’t support that rapid turnaround, you’re setting yourself up for failure and potential legal liability.

This isn’t just an issue for legal teams or risk managers. It’s also a pressing concern for business leaders, IT directors, and security professionals. When organizations sign contracts with obligations they don’t fully understand or cannot meet, they expose themselves to compliance issues, financial penalties, and reputational damage. Failing to meet a breach notification deadline might mean more than a slap on the wrist; it could translate into multimillion-dollar fines or the loss of customer trust. In industries bound by government regulations—think healthcare, defense, or finance—these missteps could even jeopardize licenses and certifications essential for doing business.

The Lure of Revenue

The desire to close deals quickly is understandable. Contracts that promise lucrative opportunities can be hard to resist, especially for sales teams eager to meet quotas and executives with growth metrics in mind. However, the pressure to sign on the dotted line without a thorough review is a ticking time bomb. Boosting sales through hasty commitments may look great in the short term, but it often comes at the expense of long-term stability. Each hastily signed contract adds to the pile of contractual risk debt, eroding the gains of the initial profit.

Take, for instance, an organization signing a contract that involves dealing with third-party data but failing to scrutinize the data security clauses. Many contracts now include rigorous data handling and breach reporting requirements, some of which align with stringent regulations like the EU’s General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA). In some cases, these contracts might even include indemnification clauses that could leave your organization financially exposed if a partner experiences a data breach.

For organizations with government contracts, the stakes are even higher. Compliance with the Federal Acquisition Regulation (FAR) or the Defense Federal Acquisition Regulation Supplement (DFARS) often involves adhering to security controls that align with frameworks such as NIST SP 800-171. Missing a clause that requires adherence to these or other government mandates can lead to contract terminations, legal action, and blacklisting from future bids.

Start with People

Contract review is often delegated to legal teams or the supply chain organization, but cybersecurity, compliance, and business leaders must be part of the process. Each department brings a unique perspective that can uncover potential issues. Legal teams may flag ambiguous terms. Cybersecurity experts can identify clauses that involve specific technical or procedural requirements that need scrutiny.

Organizations need to develop a procedure where cross-functional reviews are standard practice. This means integrating contract reviews into the workflows of risk management and compliance teams. It also means empowering them to ask questions. Is the breach notification period achievable with current incident response capabilities? Are there obligations tied to international data transfers that align with privacy laws? Does the contract bind the organization to standards that surpass the current security posture?

Build a Process

If your organization doesn’t currently have a robust contract review process, it’s time to start building one. Begin with these key actions:

1. Engage Cross-Functional Teams: Ensure your legal, IT, compliance, and risk management teams collaborate on contract reviews. Everyone should have a chance to highlight potential pitfalls in their area of expertise.
2. Document and Review Obligations: For each contract, capture obligations in an easily accessible format. This helps ensure that teams responsible for meeting these obligations are aware of them.
3. Invest in Training: Make sure that non-legal staff who deal with contracts understand the basics of what they’re reading. Training in contract literacy for key staff can go a long way.
4. Think Proactively: Document, vet, and reuse your organization’s standard terms for areas like breach notification or PII protection.

Final Thoughts

Contracts may seem like bureaucratic hurdles, but they are vital guardrails for your organization. Signing without comprehensive review is like playing poker with your cards facing outward—it might work for a round or two, but you’re going to lose in the long run.

In the end, the best advice may be the simplest: Set aside an hour. Grab a coffee. Get a highlighter. Read. Your job may depend on it.

About the Author

Craig Burland is CISO of Inversion6. Craig brings decades of pertinent industry experience to Inversion6, including his most recent role leading information security operations for a Fortune 200 Company. He is also a former Technical Co-Chair of the Northeast Ohio Cyber Consortium and a former Customer Advisory Board Member for Solutionary MSSP, NTT Global Security, and Oracle Web Center. Craig can be reached online at LinkedIn and at our company website https://www.inversion6.com/.