How Aware Are Your Board Members about Cyber Risks? Meta: Performing a cyber risk assessment is one of the most important things you can do to protect your business and reduce risks effectively. How protected from cybersecurity threats is your business? How prepared is your company to combat an unexpected data breach? In case of an inevitable attack, would you be able to spring back from the loss of customer and hampered reputation? With critical data and sensitive information out there today, there's a lot at stake for organizations of all sizes. Cyber risk has gained the infamy of a pressing business security issue in the past few years. Cyber attacks are increasingly feared by businesses for their pervasiveness and a lack of a complete understanding of the exact nature of cyber risks. This has prompted companies to seek advanced cyber risk assessment tools. Today, time requires companies to develop an in-house holistic assessment tool that considers technical analysis, governance, culture, and the financial impact of adverse cyber events. This should be in conjunction with the present layers of security provided by third party companies such as credit information companies providing credit information report. Such assessments should become a necessary tool for corporate directors who could use them to understand their organization’s exposure to technological vulnerabilities. What exactly is a cyber risk assessment? At a surface level understanding, cyber risk assessments show how well a company is prepared to tackle cyber attacks. It identifies the information assets that could be affected by a cyberattack (such as hardware, systems, laptops, customer data, and intellectual property) and the risks that could affect those assets. These assessments also measure how well a company has prepared itself to recover from such attacks called cyber resilience. Cyber attacks can come in the form of fraudulent bank wires, and breaches of customer privacy, all of which create lasting reputational damage for the victim company. In making cyber risk assessments, mainly the chief information security officers and the team have tended to focus on the number of previous attacks, their impact, and how quickly they were addressed. Their objective has mostly been to take cognizance of the known defenses. But this approach often isolates cybersecurity decisions from the business they are meant to serve and so may reflect a narrower view of risk. Moreover, technical reports don’t adequately capture attributes such as governance, culture, decision-making practices, or wider treatment of a company’s cyber risk profile and appetite, all of which board directors and business executives need to understand if they expect to make informed decisions about whether to allocate capital to improve cyber defenses instead of investing in other areas of the business How Do You Perform Cyber Risk Assessment? For an assessment to be useful to directors in a strategic capacity, the board needs to be clear about its requirements - which means it needs to know what to ask for. They should ask for a comprehensive assessment that moves beyond the technical details and that includes both an outside and inside perspective. Here are 3 steps to go about it
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