Sovereign wealth funds, among the largest investors on the planet, increasingly view controlling their data as essential to managing critical assets. This focus manifests in strategic investments in domestic digital infrastructure and rigorous compliance with national regulations set by the governments whose assets they manage. These efforts reflect a broader recognition that data sovereignty enhances security, operational resilience, and alignment with long-term economic goals — an approach UHNWIs can adapt to protect their wealth and legacy.
SWF Investments in Domestic Digital Infrastructure
Sovereign wealth funds like Saudi Arabia’s Public Investment Fund (PIF) and Qatar Investment Authority (QIA) are advancing data sovereignty through strategic investments in localized digital infrastructure.
In 2022, PIF backed the National Data Center Company (NDCC), which is dedicated to providing cloud and data services within Saudi Arabia. Aligned with Vision 2030’s goal of economic diversification and its view of data as a national asset, NDCC’s local tier 4 data center has been supporting PIF’s expansive portfolio since 2023 by ensuring sensitive financial data remains on domestic soil.
Similarly, in 2021, QIA began collaborating with Microsoft and Qatar’s Ministry of Communications to launch a hyperscale data center in Doha. This facility underpins QIA’s data-intensive investments while adhering to Qatar’s 2022 Cloud Computing Policy, which emphasizes data residency for critical sectors like finance.
Your Wealth, Our Priority: Altoo's Consolidation Power, Secure Document Management, and Seamless Stakeholder Sharing for High Net Worth Individuals. Preview Platform.
The Regulatory Push for Data Localization
A number of resource-rich nations with SWFs have enacted data localization laws to keep sensitive financial and personal data within their borders. While these regulations often focus on protecting citizens’ personal information, they also encompass the critical data handled by SWFs. For example:
- In Saudi Arabia, the Personal Data Protection Law (PDPL), which came into effect in 2023, mandates local storage for certain personal and financial data. The PIF is required to align its operations with this law.
- China’s Cybersecurity Law (2017) and Data Security Law (2021) require critical data to remain within national borders. Chinese SWFs like the China Investment Corporation (CIC) adhere to these laws under strict state supervision
- Russia’s National Wealth Fund (NWF) is subject to the country’s 2015 Data Localization Law, which mandates domestic storage for state-related financial data. Enforcement was tightened in response to sanctions and geopolitical imperatives in 2022.
Why Data Sovereignty Matters for UHNWIs
All wealth owners prioritize protecting their sensitive information from unauthorized access. While significant resources are invested in defending against illegal cyberattacks, sophisticated SWFs have expanded their security focus to include a less obvious threat: legally compliant but nevertheless unwanted access to their data.
This forward-thinking approach acknowledges that data sovereignty extends beyond traditional cybersecurity measures. For instance, U.S.-based cloud providers must comply with legislation like the CLOUD Act, which grants U.S. authorities access to data stored on their servers — even when those servers are physically located outside American borders.
UHNWIs would be prudent to adopt strategies similar to these sovereign entities by thoroughly evaluating where and how their sensitive information is stored. By recognizing and addressing these legal access vectors, wealth owners can establish more comprehensive data protection frameworks that safeguard their privacy under various international regulatory environments.
Strategically Selecting Technology Partners
While sovereign wealth funds possess virtually unlimited resources to protect sensitive data, private investors can adopt similar data control strategies without the need to build personal data centers or lobby for policy changes. Instead, they can carefully select technology partners who prioritize data sovereignty and operate under favorable regulatory frameworks.
For example, Altoo — a provider of a digital solution that automatically aggregates, analyzes, and visualizes wealth data from multiple sources — relies exclusively on private cloud infrastructure housed in a Swiss tier 4 data center. Switzerland’s stringent data protection laws provide an additional layer of security for clients.
By structuring the company’s operations this way, Altoo ensures that client wealth information is not only protected against cyber threats but also governed solely by Swiss regulations.
This deliberate approach to technology partnership allows private investors to achieve robust data sovereignty without the extraordinary resources typically required for such protection. The Altoo Wealth Platform’s design reflects the agility of private wealth, allowing UHNWIs and their families to act decisively while safeguarding their data from geopolitical and legal uncertainties.
Action Points for UHNWIs and Family Offices
To harness SWF-inspired data sovereignty, consider these practical steps:
- Prioritize Data Residency: Choose technology partners who host data in jurisdictions with strong privacy laws, like Switzerland.
- Demand Transparency: Ask advisors about their cloud providers and data storage policies. Avoid platforms with infrastructure that may be vulnerable to extraterritorial laws.
- Align with Values: Select partners whose data practices reflect a commitment to privacy and security.
- Stay Informed: Monitor geopolitical trends affecting data privacy, such as what many observers consider U.S. regulatory overreach, to anticipate risks to wealth data.
Takeaway
Sovereign wealth funds like PIF and QIA demonstrate that data sovereignty is not just a technical necessity but a strategic imperative. By investing in domestic infrastructure and adhering to national regulations, they safeguard sensitive data while enhancing operational resilience. UHNWIs and family offices can achieve similar outcomes by partnering with Altoo, whose private Swiss cloud infrastructure offers a secure, SWF-style experience tailored to private wealth.
To explore how Altoo can elevate your wealth strategy with SWF-grade data control, contact us for a demo or visit Altoo.io for case studies on data-informed investing.
