Business

C-Suite Leadership Can Cut Cyber-Attack Growth By 50% Says New Report

C-Suite Leadership Can Cut Cyber-Attack Growth By 50% Says New Report

  • New report by The Economist Intelligence Unit demonstrates critical role of C-suite in defending their firms against cyber-crime
  • Firms that adopt proactive cyber-defence strategy cut growth of cyber-breaches by more than 50%
  • When strongly supported by C-suite, firms cut the growth of eight major cyber-attacks by an average of 53%, including hacking by 60% and ransomware by 47%

A new report published today (June 2nd 2016) by The Economist Intelligence Unit (EIU) highlights the critical role of the C-suite and board in defending their firms against cyber-crime.

Data Security: How a proactive C-Suite can reduce cyber-risks for the enterprise, sponsored by Oracle, includes findings from a global survey of 300 C-suite executives conducted in February-March of 2016.

A primary driver of success was the adoption of a proactive cyber-defence strategy. The 28% of firms that prioritized this approach were able to cut the growth of cyber-breaches by more than 50%.

Another significant factor of success was the active support of this strategy by the C-suite or board of directors. Companies that pursue a proactive cyber-defence strategy strongly supported by C-suite and board have cut the growth of eight major cyber-attacks by an average of 53%. This includes reduction of the growth of hacking by 60%, ransomware by 47%, and of malware attacks by 40%.

Successful firms were also more than twice as likely to include security personnel in strategic planning, and 56% more likely to maintain a standing board committee on cyber-security.

West Coghlan, the editor of the report said:

“Cyber-criminals are now targeting all parts of the enterprise, probing for weaknesses and penetration points. All parts of the organization need to be educated and mobilized as part of an effective defence. Only the C-suite or board can provide the leadership and authority to make this proactive, cross-enterprise strategy work. Cyber-security cannot be pursued as an isolated IT initiative—it requires the active leadership of the C-Suite and Board of Directors to reduce the rate of attacks on the firm.”

Data Security: How A Proactive C-Suite Can Reduce Cyber-Risk For The Enterprise

The number one technology issue in the C-suite today is cyber-security.

And there’s no wonder—attacks are becoming more numerous and more sophisticated than ever. The cost of cyber-crime to the global economy has topped more than $445 billion2– equivalent to 1% of global GDP. Sometimes cyber-crime can seem unstoppable – while firms spent more than $75 billion on cyber-defences in 20153, cyber-crime grew by 38% that year.

That’s why C-suite executives everywhere are asking: What can we do to make a difference in defending against hackers, cyber-criminals and digital spies?

Research conducted by The Economist Intelligence Unit (EIU), sponsored by Oracle, provides answers. The results show that a proactive security strategy backed by a fully engaged C-suite and board of directors reduced the growth of cyber-attacks and breaches by 53% over comparable firms. These findings were compiled from responses by 300 firms, across multiple industries, against a range of attack modes and over a two-year period from February 2014 to January 2016.

The lessons are clear. As cyber-attackers elevate their game, the response must be an enterprise solution. Only C-suites and boards of directors marshal the authority and resources to support a truly enterprise-wide approach. In sum, proactive cyber-security strategies, supported by senior management, can cut vulnerability to cyber-attack in half.

The payoff for being proactive

The EIU survey respondents were all members of the C-suites or boards of directors of their respective companies. They represented medium to large businesses in over 20 verticals, with equal representation from Europe and the Middle East, the Americas and the Asia-Pacific region. (See the appendix for more demographic details.)

The collective responses show the factors that differentiate enterprises with a high degree of success in cyber-security from those that continue to struggle. First, successful firms rely on proactive security strategies. Executives at companies with a high degree of confidence in their defenses describe themselves as having a proactive data security strategy that goes beyond traditional approaches that rely primarily on reactive perimeter defenses managed by IT departments. Instead, proactive strategies actively monitor external threats and mobilize the entire workforce to stave off attacks. In short, these approaches combine both the latest security technology and new business processes.

C-Suite Cyber-Attack

“Proactive security determines the impact of a breach, what data was actually disclosed, and the cost associated with it. It’s more thoughtful and less emotional than traditional approaches,” says Ron Woerner, director of cybersecurity studies at Bellevue University. Second, successful security hinges on proactive C-suites and boards of directors. Why is the involvement of the C-suite and board so important?

C-Suite Cyber-Attack

Part of the answer stems from the new kinds of threats organizations are facing today. Criminals attack all parts of the enterprise and frequently include penetrations launched through third-party suppliers and customers. These broader, more complex threat parameters require action from executives with oversight into the entire enterprise.

That demands a C-suite-level response. These leaders have the authority to mobilize all parts of the organization, including appropriate responses from suppliers and partners. Just as importantly, senior executives provide budgetary and other resources to help ensure the success of proactive strategies. “Boards become actively involved in security when they realize that security drives revenues and customer loyalty,” says Jeffrey Ritter, external lecturer at the University of Oxford and author of the book Achieving Digital Trust. “If partners or customers are not confident about how secure your business is, they will decide to
not do business with you.”

For reasons like these, senior-level involvement is a clear indicator of cyber-security success, as the research data shows.

The payoff isn’t confined to just responding more effectively to an attack—the influence of proactive C-suites also contributes to a significant reduction in the growth of cyber-attacks themselves.

C-Suite Cyber-Attack

Overall, companies with proactive strategies and highly engaged senior executives are cutting the rate of growth of cyber-attacks in half, which significantly reduces exposure to cyber-attack risks, according to the EIU research.

Six steps to a more effective cyber-security strategy

The benefits of proactive, C-suite-driven security are clear, but what are the essential elements to focus on when creating a plan? The following six steps correlate with high rates of deterrence of cyber-attacks and, tellingly, all are within the responsibilities of the C-suite and board of directors.

1. Align the organization to support security

Key drivers of cyber-deterrence include reducing organizational barriers to security implementation and ensuring common standards across the enterprise. The process starts with breaking down silos. This addresses leading causes of security breakdowns, including fragmented security solutions. Silos also create gaps in coverage and force organizations to set protection at the level of the lowest participant.

The next step in organizational alignment is implementing common standards across the organization. This enables an integrated defense, makes security easier to manage and measure, and encourages organizations to adopt the highest shared standards for all departments.

C-Suite Cyber-Attack

2. Ensure employee buy-in and compliance with corporate security practices

Companies that have been more successful in deterring attacks have a stronger track record in these two important areas.

C-Suite Cyber-Attack

Employee compliance is essential for cyber-security success since this group continues to be the largest single cause of breaches, according to multiple industry studies. But tough compliance mandates alone aren’t enough. Organizations must understand any road blocks that are keeping employees from strictly following policies. In particular, focus on whether employees are impatient with security procedures because they’re seen as hampering productivity. Also, many organizations will benefit from additional employee training to ensure people understand the importance of security policies and have the knowledge to follow them completely.

3. Create a strong centralized management structure for security

Companies that have been more successful in deterring cyber-attacks place a stronger reliance on centralized control over security programs.

C-Suite Cyber-Attack

The reasons for centralized security are clear. Organizations can implement integrated systems that reduce the chance of security gaps that provide entry points for hackers. In addition, centralization makes it easier to adopt common standards and enterprise-wide detection and monitoring of intrusions. Other benefits include simplified training and policy management, as well as cost efficiencies that come with not procuring and maintaining multiple security systems.

4. Meet skills shortages by retraining in-house personnel

Attracting and retaining skilled security talent is a challenge for any organization. But successful firms are taking steps to address this long-time problem.

C-Suite Cyber-Attack

Notably, successful firms are meeting the challenge of recruiting data security experts by elevating the security skills of existing employees. These staff members have strong incentives to hone their security skills. Not only will it make them more effective for their current employers, but it’s a smart career move. One study found that by 2019, a skills gap will leave 1.5 million cyber-security jobs unfilled5. “Over time, effective security has become less about just technology and more about integrating security into the processes of the firm,” says Mr Woerner.

5. Tap the expertise of third-party security firms

Given the size and complexity of the cyber-security challenge, internal resources alone may not be enough to fully defend against cyber-criminals. Successful firms supplement their internal security resources with third-party vendors. These providers offer an independent view for monitoring the effectiveness of a client’s defenses. Just as importantly, because third-parties engage with a range of customers, they bring a broad perspective on trending threats, as well as the latest best practices for keeping organizations protected.

C-Suite Cyber-Attack

“If I’m an independent threat-intelligence service with 5,000 clients, I have an opportunity to see new patterns of behavior before they become widely known by others,” says Mr Ritter. “I know of one service that updates its black list every 30 seconds, and to do that, they’re looking at over 275,000 nodes, including 50,000 honey pots, or decoy systems, that they manage to monitor the activities of hackers.”

6. Invest sufficient resources—in particular, security funding—to meet today’s complex data-security requirements

Despite cyber-attacks increasing by nearly 40% in 2015, budget increases remain modest. On average, enterprises are increasing spending by less than 10%.

C-Suite Cyber-Attack

It’s no wonder that IT staff at many firms feel outgunned and outspent by cybercriminals.

The EIU study found a significant correlation between low levels of funding and a lack of success which, as shown in earlier charts, also correlates with higher growth rates of attacks.

A ray of hope

As cyber-crime evolves, the role of the C-suite and board of directors is becoming vital for successful security efforts. Traditional static defenses-characterized by “defending the firewall”—are becoming less effective as the volume and sophistication of attacks increase. The new era of cyber-crime prevention calls for a more elastic, proactive and cross-enterprise set of defenses.

C-Suite Cyber-Attack

This in turn calls for mobilizing employees, partners and external firms. Make no mistake—the answer isn’t just another IT initiative. An effective, proactive strategy must mobilize almost the entire firm. Only the C-suite/board has the authority to support this level of engagement for the long term. But as the EIU data shows, this modern approach pays off in a significant decrease in the number of cyber-attacks on the enterprise.

There’s one other benefit—greater peace of mind.

Firms that are pursuing proactive security strategies with strong C-suite backing are more confident about the future—it’s a welcome contrast to the litany of discouraging news that often surrounds cyber-security.

Appendix: summary of survey demographics

In February-March 2016, the EIU surveyed 300 executives identified as responsible for or are knowledgeable of cyber-security in their companies. The following is a summary of survey sample demographics.

C-Suite Cyber-Attack

Get our newsletter and our in-depth investor case studies all for free!