Cyber risk should be on every business executives’ radar as it directly affects the financial well-being of an organisation. Proactive management of cyber risk is essential to protect assets, maintain financial stability, and uphold the trust of stakeholders.
But what is cyber risk? And how is it different from a cyber threat? When thinking about cyber security, it’s important to be clear about the difference between the two terms.
A criminal hacking into your computer systems is a cyber threat. However, if that criminal steals your customer database, that poses a major cyber risk. After all, losing your customer database could harm revenue, incur major losses through compensation or lawsuits, damage business reputation, or incur fines from regulators. In other words, cyber risks are the real-world consequences for your organisation that result from a cyber threat occurring.
If a cyber threat occurs, some of the real-world consequences your organisation is likely to be face include:
Cyber-attacks can lead to significant financial losses, ranging from immediate remediation costs to long-term consequences such as legal liabilities, regulatory penalties, and potential impacts on shareholder value. Recognising cyber risk as a component of business risk allows for a comprehensive assessment of financial exposure.
Most business now operate in an interconnected digital landscape. Any disruption caused by a cyber-attack can cripple essential business operations. Considering cyber risk as integral to business risk ensures that business leaders appreciate the potential for operational disruptions, so they can implement resilience measures to mitigate such risks.
Cyber security breaches can tarnish an organisation’s reputation, eroding customer trust and loyalty. Understanding cyber risk as part of the broader business risk landscape prompts strategic efforts to safeguard brand integrity, customer relationships, and market standing. This can protect the way your business is perceived by a range of stakeholders, including customers, employees, the general public, investors, and others.
Businesses operate in a rapidly evolving regulatory landscape. They face increasing obligations to secure sensitive data. Failing to address cyber risk can result in non-compliance, exposing organisations to legal consequences, including regulatory fines. Directors and senior executives can also be held personally accountable if they are found to be negligent in fulfilling their responsibilities to safeguard the company from a range of risks. Viewing cyber risk as business risk aligns risk management practices with regulatory requirements.
Cyber incidents have far-reaching implications on strategic decision-making. Business executives, as key strategists, need to factor in cyber risk when formulating business plans to ensure the resilience and adaptability of the organisation in the face of evolving cyber threats.
How Virtuelle Group can help
It’s important to start thinking about cyber risk as another form of business risk. This paves the way for your organisation to embrace a risk-based approach to cyber security.
CFOs can use their experience in risk management to help shape the thinking of their organisation’s board and leadership team, including the CTO and CISO. CFOs can demonstrate that a risk-based approach is ideal for ensuring limited resources are allocated to the most critical threats your business faces.
When it comes to conducting effective cyber risk assessments, having a team with deep cyber security knowledge is essential. That’s why many organisations turn to cyber security service provider, Virtuelle Security, for a helping hand.
Our highly trained Governance, Risk and Compliance (GRC) team can guide you in all aspects of cyber risk assessment and remediation. We work with your existing cyber security team to ensure risks are accurately assessed, so you can prioritise resource allocation and control implementation.
Contact us today for a FREE consultation with Robert Kirtley, our Cyber Security Director, and learn how Virtuelle Security stands ready to help you efficiently remediate cyber risk.