How to protect your business from cyber attacks: A guide to cyber risk management
No one is immune to cyber-attacks. In fact, a growing number of businesses are falling victim to cyber criminals every day. If you're not taking steps to protect your business from cyber threats, you're putting yourself at risk. In this article, I will discuss what cyber risk management is and how you can implement it into your business.
Cyber Risk Management: What are the Exposures?
Business is dependent on technology today, which creates new emerging risks due to this dependency.
Every technology we adopt in business exposes us to new risks. The cloud, mobile devices, the internet of things (IoT), and social media are just a few examples of how technology has changed the way we do business and created new risks that need to be managed.
Cyber exposures are mostly linked to threats in conjunction with vulnerabilities. A threat is anything that can be used to exploit a vulnerability, resulting in a negative impact to the business. Vulnerabilities are weaknesses in systems, processes, people, or controls that can be exploited.
A cyber attack is an attempt to gain unauthorized access to or damage a computer system, usually with the intention of causing harm. There are many types of cyber attacks, but some of the most common include: -Malware attacks: Malware is a type of malicious software that is designed to damage or disable computer systems. Malware can be spread through email attachments, websites, or infected devices. -Phishing attacks: Phishing is a type of social engineering attack that is used to trick people into revealing sensitive information, such as login credentials or financial information. Phishing attacks are often carried out through email or malicious websites. -Denial of service attacks: A denial of service attack is an attempt to make a computer or network resource unavailable to its intended users. Denial of service attacks can be carried out by flooding a system with traffic or requests for data. -SQL injection attacks: SQL injection is a type of attack that allows attackers to execute malicious SQL queries against a database. SQL injection attacks can be used to steal data or damage databases. There are many other types of cyber attacks, but these are some of the most common.
Cyber risk on the other side, is the probability of a loss occurring from a cyber attack.
Cyber risk management is the process of identifying, assessing, and responding to risks posed by cyber threats.
Corporate Risk Management and Cyber Risk: Between Challenges and Successes
The management of risks, and cyber risk in particular, is a major challenge for organizations. A recent study found that 84% of organizations surveyed experienced at least one cyber security incident in the past 12 months.
The study also found that the average cost of a cyber security incident is $13 million. These numbers vary depending on which news or article you read, but the reality is that cybercrime is becoming more and more common, and it's costing businesses a lot of money.
There are many challenges that organizations face when it comes to managing cyber risk. One of the biggest challenges is that there is no one-size-fits-all solution.
Another challenge is that cyber risks are constantly changing. New vulnerabilities and threats are always emerging, which makes it difficult to keep up with the latest risks. It's also difficult to identify all of the potential risks that an organization faces. Organizations need to have a good understanding of their own systems and processes in order to identify risks. Finally, it can be difficult to get executive buy-in for cyber risk management initiatives. Executives may not see the need for investing in cyber security if they don't think their organization will be targeted by a cyber attack. Cybersecurity is often perceived as a pure cost center rather than an investment.
Despite these challenges, there are many organizations that have been successful in managing cyber risk. These organizations have implemented effective cyber risk management programs and have seen significant reductions in the cost of cyber security incidents.
Corporate Governance, ESG and Risk Management: What about Cyber?
As organizations face increasing pressure to address environmental, social and governance (ESG) issues, they are also starting to focus on cyber risk management.
However, there is a lack of guidance on how to effectively manage cyber risk in an ESG context. As a result, many organizations are struggling to integrate cyber risk management into their overall ESG strategy. However, ESG should consider cyber as part of its governance, as the cyber risks can have a material impact on an organization’s financial performance.
Cyber Risk, and Industries: Different Maturities and Different Postures
The banking sector is often cited as an example of an industry that has been successful in managing cyber risk.
This is due to the fact that the banking sector is highly regulated and has been required to implement strong cyber security measures.
The banking sector has also invested heavily in cyber security, with banks spending an average of $15 million per year on cyber security. This has allowed the banking sector to develop a good understanding of cyber risks and how to mitigate them.
The healthcare sector is another example of an industry. The healthcare sector is also highly regulated, and has been required to implement strong cyber security measures. However, the healthcare sector has not invested as heavily in cyber security as the banking sector. As a result, the healthcare sector has not developed the same level of understanding of cyber risks and how to mitigate them.
This difference in understanding has led to different approaches to managing cyber risk. For example, the healthcare sector has been slower to adopt risk management frameworks such as the NIST Cybersecurity Framework.
The retail sector is an example of an industry that has not been as successful in managing cyber risk. The retail sector has not been as heavily regulated as the banking and healthcare sectors, and has not invested as heavily in cyber security. As a result, the retail sector has not developed the same level of understanding of cyber risks and how to mitigate them This lack of understanding has led to a number of high-profile cyber security incidents in the retail sector. For example, in 2014, Target was the victim of a data breach that resulted in the theft of millions of customer records.
The retail sector is also facing a number of challenges that make it difficult to manage cyber risk. For example, the retail sector is undergoing a period of transformation, with many retailers moving away from brick-and-mortar stores to online stores. This transformation is making it difficult for retailers to keep up with the latest cyber risks. In addition, the retail sector is highly competitive, and many retailers are reluctant to invest in cyber security due to concerns about the cost.
Managing Cyber Risk: What are the Steps?
In order to effectively manage cyber risk, organizations need to take a number of steps. First, organizations need to identify and assess their cyber risks. This assessment should include an evaluation of the likelihood and impact of cyber incidents. Second, organizations need to develop a cyber risk management strategy. This strategy should be aligned with the organization’s overall business strategy. Third, organizations need to implement controls to mitigate their cyber risks. These controls should be designed to protect the confidentiality, integrity, and availability of data. Fourth, organizations need to monitor their cyber risks on an ongoing basis. This monitoring should include regular assessments of the effectiveness of controls.
Finally, organizations need to respond to cyber incidents when they occur. This response should include steps to contain the incident, limit the damage, and restore data.
Cyber risk management is a critical part of any organization’s overall risk management strategy. It helps a business to take a decision regarding a cyber risk between acceptance, avoidance, treatment, and transfer.
However, measuring cyber risk can be a challenge, as there is no single metric that can be used to assess all aspects of cyber risk. Organizations need to consider a range of factors when measuring cyber risk, including the likelihood of a cyber attack, the potential impact of a cyber attack, and the organization’s ability to mitigate the impact of a cyber-attack.
Quantitative Approaches to Cyber Risk Management: Pros and Cons
There are a number of different approaches that organizations can take to assess and measure cyber risk quantification. One approach is to use qualitative or quantitative methods, such as cost-benefit analysis.
Another approach to cyber risk quantification is to use qualitative methods. Qualitative methods are less concerned with the costs and benefits of controls, and more concerned with the organization’s overall exposure to cyber risk.
Qualitative methods can be used to assess the organization’s overall cyber risk profile. This assessment can help organizations identify areas of high risk and prioritize their cyber security efforts.
A key advantage of qualitative methods is that they can provide insights into the organization’s overall exposure to cyber risk. This information can be used to prioritize cyber security efforts. A key disadvantage of qualitative methods is that they can be subjective, and they may not provide a complete picture of the organization’s cyber risk.
Quantitative methods like cost-benefit analysis is a tool that can be used to compare the costs and benefits of different cyber security controls. This tool can be used to help organizations make decisions about which controls to implement.
A key advantage of cost-benefit analysis is that it can be used to compare the costs and benefits of different controls. This tool can help organizations make informed decisions about which controls are most effective at reducing cyber risk.
A key disadvantage of cost-benefit analysis is that it can be difficult to quantify the benefits of cyber security controls. For example, it can be difficult to quantify the benefits of controls that prevent data breaches.
There are however, many more models and strategies to measure and quantify cyber risk. In my other articles, I provide further visibility and insights.