Russ Kirby, Assistant Vice President, Senior Account Manager of FM Global, on how businesses can reduce the damage that cyber-attacks can cause.
Over the last twelve months, cyber threat has become a primary concern for decision makers at multinational organisations.
In January 2018, the World Economic Forum’s Global Risk Report reinforced this concern, ranking cyber-risk as the third most likely risk that businesses will face this year. Clearly, the C-suite’s concern is justified – but why is the threat of cyber of increasing? And what can businesses do to mitigate the risk of an attack occurring, as well as reducing the damage, should an attack occur?
Why is the threat from cyber-attacks increasing?
Cyber-threat faced by businesses is increasing for many different reasons. One is simply that there are more internet-connected devices than ever before. In 2017, there were approximately 8.4 billion devices connected to the Internet of Things (IoT). This is expected to rise to approximately 20.4 billion by 2020. With more IoT enabled devices being used by businesses and employees in the Industrial internet of Things (IIoT), the risk of hostile cyber attacks increases proportionally.
The increasing use of internet-enabled devices by both businesses and consumers unfortunately represents a major security risk. Many of these devices are built without adequate security features installed, often relying on factory-set passwords to provide protection. Additionally, many of these devices, such as industrial control systems, can be difficult to update with new security features, exposing those devices to hostile attack.
The scale of cyber-attacks and the potential for major damage is also increasing at a rapid pace. Distributed denial of service attacks (DDoS), were once considered a rarity, but in 2016 nearly 3 trillion hostile attacks were observed on a monthly basis. According to the Global Risks Report in 2017, attackers have also become more persistent, targeting each DDoS target on average 32 times over a three month period.
Given this increase in cyber-threat, businesses and the C-Suite should be aware that the scale of attacks they will likely face in 2018 and beyond will increase. However, all is not lost, there are measures that can be taken to minimise the impact of a cyber-attack and enhance resilience.
How can businesses enhance resilience against cyber-attacks?
Primarily, the C-suite must ensure that a culture of resilience is instituted throughout the business. Resilience is a choice, a choice that can protect both bottom-line and reputation. To improve resilience against the threat of cyber-attacks, businesses need to assess their critical data assets and ensure that steps are taken to improve human behaviour in relation to cyber-threats, technological security systems, physical security, as well as improving cyber-security across supply chains.
To build cyber resilience, businesses should:
• Engage and coordinate across all areas of the business from C-suite to IT to operational functions. Cyber risk it not just an IT issue.
• Improve employee training to make personnel aware of various types of cyber-attacks, how they operate, and steps to ensure that an employee does not unwittingly initiate a cyber-attack.
• Ensure that adequate security procedures are in place to stop external individuals from gaining access to sensitive areas. Only personnel with a specific clearance should have access to server and network rooms, and all externally-contracted staff should only be permitted access following sufficient background checks.
• Computer systems should always be updated with the newest patches provided by the software companies. The WannaCry attack, which affected 300,000 computers across 150 countries, illustrated that a failure to keep computer systems up-to-date can cause major disruption. Hostile attackers can cause major damage or hold systems to ransom for financial gain.
• Data held by third parties should be restricted. Businesses could be vulnerable if a third party suffered a data breach and sensitive information was lost, such as passwords. This should coincide with employee training that advocates various passwords being used by employees, minimising the risk of a damaging attack.
• Finally, the C-Suite should also seek to impress upon key suppliers the importance of cyber-security and risk mitigation improvements. Ideally, alternative suppliers should be on standby that can begin operating as needed.
What should businesses do to ensure that recovery occurs quickly following a cyber-attack?
When a cyber-attack does occur, businesses must be able to recover as soon as possible. A culture of resilience will be a major benefit in the recovery process, although the C-Suite should also look to take additional steps to improve this process.
These steps should include:
• The creation of detailed Business Continuity Plans, which can be implemented as soon as a cyber-attack occurs. This should detail priority areas and how employees should respond, who should be responsible for various actions, as well as how various external stakeholders should be contacted.
o Working with an experienced communications team can mitigate the reputational damage suffered when a cyber-attack occurs, and can assist with reputation recovery in the adverse environment created by the attack.
• Cyber-security and IT experts should be available as soon as possible, to begin assessing the damage caused by a cyber-attack, and to ensure that intruders are removed from compromised systems swiftly.
Finally, businesses should partner with an insurer that has a clear understanding of the issues created and the damage that can be caused by a cyber-attack. Preferably, the insurer and the insured should be working towards a long term partnership and a mutual understanding of the insured’s business, its cyber risks, and policy coverage. This will ensure that claims can be paid as swiftly as possible, providing the insured with the necessary capital to continue operating during a loss event.
In 2018, resilience is one of the greatest assets that a business can have. At FM Global, we believe that resilient businesses are successful ones. Whilst cyber-attacks are evolving quickly and can cause major damage to businesses, building resilience into your organisation will allow it to recover quickly, which will minimise disruption in the long term.