Few organisations are highly confident in their ability to manage the risk of a cyber attack, despite viewing cybersecurity as a top risk management priority, according to results of a recent global survey on cyber risk perception conducted by Marsh and Microsoft Corp.
In the survey of more than 1,300 senior executives, two-thirds (62%) ranked cybersecurity among their organisations’ top five risk management priorities – approximately double the response to a similar question Marsh asked in a 2016 survey. Those respondents whose organizations had been successfully attacked were slightly more likely to prioritize cyber risk than those who had not.
The By the Numbers: Global Cyber Risk Perception Survey also found that a vast majority – 75% – identified business interruption as the cyber loss scenario with the greatest potential to impact their organisation. This compares to 55% who cited breach of customer information, which has historically been the focus for organisations but came in third. Reputational damage was second at 59%.
Few well prepared for cyber events
Despite this growing awareness and rising concern, only 19% of respondents said they are highly confident in their organisation’s ability to mitigate and respond to a cyber event. Moreover, only 30% said they have developed a plan to respond to cyber attacks.
“Cyber risk is an escalating management priority as the use of technology in business increases and the threat environment gets more complex,” said Mr John Drzik, president Global Risk and Digital, Marsh. “It’s time for organisations to adopt a more comprehensive approach to cyber resilience, which engages the full executive team and spans risk prevention, response, mitigation and transfer.”
Risk quantification important in cyber insurance purchase
An important step toward this goal is risk quantification. According to the survey, fewer than 50% of respondents said their organisation estimates financial losses from a potential cyber event and, of those that do, only 11% make their estimates in economic terms. Such calculations are a key step in helping boards and others develop strategic plans and investment decisions, including those related to cyber insurance purchase, the report notes.
At the same time, responsibility for cyber risk management continues to lie primarily with the information technology (IT) department, with inconsistent involvement of other stakeholders across the enterprise. 70% of respondents pointed to IT as a primary owner and decision-maker for cyber risk management, compared to just 37% who cited the president/CEO or the board of directors, and 32% who cited the risk management function.
Comprehensive approach needed
“While technology is the foundation of any good cybersecurity strategy, companies can benefit from investing in non-technology solutions like risk management as part of a holistic approach,” said Mr Matt Penarczyk, vice president and deputy general counsel, Microsoft. “Through advanced technology, tools and training, for example, companies can better protect the data in their networks and be ready for the business interruptions and reputational risks associated with cyberattacks.”
The report is based on findings from the Marsh-Microsoft Global Cyber Risk Perception Survey administered between July 2017 and August 2017. 1,312 senior executives participated in it. They represented a range of key functions, including information technology, risk management, finance, legal/ compliance, senior management, and boards of directors. 36% of respondents were from Asia.
The survey report can be downloaded here.