CYBER SECURITY: Study shows many retailers adopt an ostrich approach to cyber security
According to a study conducted by the insurer Willis Group, sixty percent of US retailers describe their risk of cyber crime as “significant”, “serious” or “critical”. But, would you believe, almost ten percent do not feel that they are at risk at all – or, at least it would seem, they believe that if they ignore the threat, the nasty monster won’t get them. The data for the study was garnered from filings which retailers have to submit to the SEC.
Retailers perceive the top three cyber risks as; privacy/loss of data (74%), reputational risk (66%) and cyber liability (61%). Interestingly, less than 10% of companies are worried about the cyber risk they face from third party vendors’ systems. Willis describes this as surprising. We would describe it as gobsmackingly low – and wrong – but I’d put good money on a bet that you would find this attitude replicated across the entire business spectrum. If it is ‘below stairs’ it is psychologically much easier to deny or ignore. The problem is much less likely to be seen and recognised and, in our experience, third party vendors frequently carry the highest cyber risk. Given that retailers place heavy reliance on third-party technology partners, malicious or criminal hackers will often seek vulnerabilities to exploit through third-party vendors’ systems. Boundaries, real or virtual, will always offer weaker defences and therefore more opportunities to those who seek to breach them.
Half of retailers use technical safeguards as their primary defence against cyber attack and 17% admit to having insufficient stop-loss resources in place. Only 10% have taken out insurance against cyber exposure. As Pete Seeger said, “When will they ever learn”!
Every company, no matter how small, has something worth stealing. Fixing the fence is not always as expensive or time consuming as you might think and it will always be more affordable than coming back from a crisis caused by a cyber incursion. Don’t be one of the 17%. Call us. In the meantime….
Mind your eye…….