CYBER RISK & BOARD EXPOSURE
The threat of high-profile cyber breaches is well understood. Responding to and recovering from a breach incurs a direct cash cost, which is only the beginning. Potential lawsuits from customers or business partners, regulatory fines, reputational risk, and loss of business are all real dangers in today's world. Furthermore, directors increasingly face the possibility of personal liability for these losses.
Given the complexity of the issue and the wealth of existing literature, there is a wealth of knowledge on what directors need to know to fulfill their fiduciary responsibilities and mitigate risk. The recommendations are extensive and include understanding data security and privacy laws and regulations, ensuring that the company has undergone a cyber risk assessment, and understanding the differences between various approaches and areas that may be left uncovered. Additionally, in the event of high-profile breaches, the board must take a front and center role.
To calm customers and allow employees to focus on business, it is crucial to be able to explain cyber defenses, including technical, people, and reporting processes. However, before a breach is discovered, the board must ensure that it has followed best practices by acting on audit recommendations, implementing a system to alert the board to material changes to the security architecture and the risks they present, and finally providing operational support to train and educate all employees on cyber defense best practices.
This is where a digital director can be invaluable. By providing advice on different cyber testing approaches and professional certifications, they can help the board better understand the cyber security architecture and how it is protected. They can also offer insight into the audit report and provide guidance on how to mitigate exposures with minimal investment, making a meaningful impact.
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