Protect what you can. It’s crucial for executives to realize that hackers’ perpetual inventiveness shouldn’t discourage companies from addressing the risk, even if they can’t eradicate it. The risk management function, like cyber-attackers, must continually evolve – not only to shield the company from cyberthreats, but also to minimize the potential impact of any such events that do occur. Says one executive who responded to the survey, “Risk elimination is not our goal. Risk reduction is our goal.”
It’s easy to understand why so many senior executives share the same unease. Given the stakes, companies can’t afford to be complacent. Beyond compromising sensitive date about customers or suppliers, cyber-breaches can critically impair relationships with any and all business partners, including investors.
Cyber-attackers have successfully breached brand-name retailers, high-profile financial organizations, and others, including Equifax. In the aftermath of such breaches, the damage can spread in many directions, not only contaminating a company’s reputation but also poisoning its bond with customers by exposing them to identity theft and subsequent financial losses.
A retail giant’s 2013 breach sent quarterly profits into a plunging spiral and ultimately cost the CEO his job. An awareness of how far and wide such damage can spread exemplifies why almost 3 in 10 respondents (29%) chose ‘bad press’ as a top concern.
Cyber-attackers typically share a common motivation: money. There’s a liquid market for customer information, including Social Security numbers and credit card data. Companies are clearly aware of their responsibility to protect customers from being compromised. Among respondents, a clear majority (59%) cited customers as their top-most concern in terms of potential litigants. In second place, named by significantly fewer respondents (40%), were regulators, followed by employees at 33%.
Cybersecurity has become a hot topic among lawmakers, who have been seeking a definition for “reasonable” security measures. Such a classification could theoretically become part of a law that would hold companies responsible for breaches in which they would legally be deemed “negligent.”
Efforts to require companies to report certain aspects of their business practices that have created potential vulnerabilities have foundered – so far – because such disclosures could also provide a treasure map for hackers.
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