We have confirmed that when integrating Dynamics 365 with SharePoint, folders are created for each entity and record.

While access to these folders is controlled by SharePoint's access management, users belonging to the site's owner group can view all folders.

This raises concerns that users on the SharePoint site may be able to access folders and data integrated with Dynamics 365.

We request enhancements to the functionality to reflect Dynamics 365 record access rights in the generated document libraries to prevent unintended users from viewing folder information, and to enable more granular access control for the SharePoint site itself.