Worry about Cyber Risks Remains on the Rise
American business leaders worry about the same types of major risks as they did last year, however rising levels of concern over cyber risks and the ability to attract and retain talent have shifted the ranks in some subtle and no-so-subtle ways.
While cyber risks affect every business, the varying degrees of concern stem from a realization that cyber risks impact industries differently. Additionally, all businesses are starting to realize cyber liability is not just a third-party risk meant to protect data. It is also a first-party risk where their bottom lines are impacted.
For instance, Corporate Account Takeover has caused considerable loss for the Banking industry and their clients. When a company’s network is breached, hackers are able to access online banking platforms to process fraudulent funds transfers. Depending on the reasonableness of the protection provided by the bank, the company may responsible for the loss. The bank is then stuck with the decision to either leave their client with a funds transfer loss, or in an effort to maintain their relationship, pay for the loss themselves. This is exacerbated by the fact that banks have minimal control on the safeguards their clients use to combat these losses.
Professional Service firms, while they have a wealth of sensitive client information to protect, also stand to lose money due to cyber attacks. For instance, if a law firm suffers a cyber extortion event and loses access to its network, it cannot adequately represent its clients. This will not only lead to lost billable hours, but negative PR that will undoubtedly lead to lost business.
Even in Manufacturing, processes are now largely managed via electronic mechanisms that can be compromised by cyber attacks. If a company’s network is attacked, manufacturing comes to a halt. Revenue stops coming in and customers are lost.
These circumstances lead to the realization that, while all businesses are impacted, some just have more to lose when it comes to cyber attacks.
Many U.S. Businesses Still Feel Unprepared for Top Risks
While the ranking of top concerns may have slightly shifted, the gaps between how much U.S. businesses worry verses how prepared they feel to manage these risks remains large. In fact, the top risk concerns are often among the 3 to 5 risks businesses feel the least prepared to handle. Furthermore, only 50% of companies report having a written business continuity plan.
Similarly, as businesses become more concerned about cyber risks, they invest more in strengthening their cyber event protocols. However, there is still a lot businesses can do to adequately protect themselves. Implementing safeguards to prevent cyber attacks, as well policies and procedures to follow when they occur, will become the norm rather than the exception.
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