Cyber Risk Management Trend 1: Increased Board Liability and Involvement
The US SEC’s latest rulings on cybersecurity risk management, strategy, governance, and incident disclosures suggest that board members will be compelled to take a more active role in their organizations’ cyber risk management efforts. The increased transparency about the board’s role in cyber activities now holds them more accountable to investors.
Although, for now, the SEC removed its explicit proposal that cyber expertise must be present in the boardroom, the recent regulations nevertheless generate momentum toward this requirement. Instead of subjecting US corporations to this demand along with all of the other new regulations, the governing body will institute this particular obligation gradually. We should expect to see updates to their July ruling in the upcoming year.
Tip: Translate Cybersecurity into Broader Business Terms
One of the most prominent obstacles preventing cyber risk management from being incorporated into broader business objectives is the communication factor. Although they acknowledge its importance, board members typically don’t have cybersecurity expertise. This limitation prevents the technical concepts and achievements of CISOs and security leaders from being understood in tangible terms.
However, by translating these technicalities into event likelihoods and potential financial implications, board members can comprehend the immense value of cyber risk management initiatives. Regulators, too, better understand these terms, and we should expect that they will be more explicit in requesting the potential monetary impact of cyber risks.
Calculating Material Thresholds With Kovrr’s Cyber Materiality Analysis
To help bring high-level stakeholders and cybersecurity leaders closer together, Kovrr developed the Cyber Materiality Analysis feature. This feature quantifies an organization’s cyber risk and provides the likelihood of experiencing various loss scenarios. For instance, there may be a 1.43% likelihood of experiencing a cyber event that results in a 12-hour outage, an amount that surpasses the materiality threshold.
This feature also highlights the likelihood of potential financial damages and data record losses or compromisations. By translating cyber risk into broader business terms, the Cyber Materiality Analysis feature ensures cybersecurity can be elevated to the boardroom.
Cybersecurity Risk Management Trend 2: Risk-Based Prioritization of Cyber Initiatives
With an overwhelming number of digital threats, organizations find themselves in a precarious balancing act between cybersecurity and other departmental resource allocations. Especially considering the bleak economic outlook, cyber teams need to accept the impossibility of safeguarding against every conceivable threat and instead focus on risk-based prioritization.
It’s imperative to focus on the cyber risks that present the highest likelihood of occurrence coupled with the potential for the most significant financial impact to navigate this economic reality. Prioritization ensures optimized cyber budgets and allows CISOs to fortify an organization’s defenses against the most pressing and detrimental threats.
Tip: Assess Levels of Cyber Risk: Quantify Both Likelihood and Impact
Achieving a data-driven understanding of which risks an organization is most likely to experience and suffer significant damage from requires a cyber risk assessment framework that is data-agnostic and incorporates internal and external global cyber intelligence data. Cyber risk quantification (CRQ) emerges as the ideal solution for this endeavor.
For enterprises, adopting CRQ provides a comprehensive tool for assessing their specific threat landscape, uncovering event likelihood and impact based on type and attack vector. This detailed analysis enables cyber leaders to create prioritized cyber risk management plans that not only enhance security but also demonstrate positive ROI through risk mitigation, transfer, or absorption.