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Why Cyber Risk Should Be Considered a Business Risk and a Government Institution Risk

By Juan Pablo Castro, Director of Cybersecurity Strategy & Technology (LATAM) at Trend Micro Inc.

 

With over two decades of experience in the field of cybersecurity, I have seen firsthand how cyber risk has evolved from being a technical issue confined to IT departments to a critical business and operational concern. This shift is evident across both private sector businesses and government institutions. Recognizing cyber risk as a core business risk is crucial for safeguarding operational continuity, financial stability, and public trust. The 4Vs framework—Value, Velocity, Variety, and Visibility—provides a comprehensive approach to understanding and managing these risks.

Cyber Risk as a Business Risk

In my work with various businesses, I’ve observed that cyber risk management is essential for protecting financial health and operational resilience. Cyberattacks can lead to significant financial losses through data breaches, ransomware, and business interruptions. The average cost of a data breach can be staggering, encompassing lost revenue, remediation efforts, and potential legal penalties. Cyber incidents can also severely damage a company’s reputation, resulting in loss of customer trust and long-term market position.

 

To address these risks, businesses must consider the 4Vs:

 

1. Value: Understanding the value of digital assets is crucial. Protecting high-value assets, such as customer data and intellectual property, is a top priority.

2. Velocity: The speed at which cyber threats evolve requires businesses to react swiftly. Rapid threat detection and response are essential to mitigate damage.

3. Variety: Cyber threats come in various forms, including phishing, malware, ransomware, and advanced persistent threats (APTs). A multi-layered defense strategy is necessary to address this variety.

4. Visibility: Achieving comprehensive visibility into the organization’s IT infrastructure is key. Enhanced visibility allows for proactive risk management and timely threat mitigation.

 

Cyber Risk as a Government Institution Risk

 

In my collaborations with government institutions, I’ve noted that they face similar, if not greater, cyber risks. The implications of a cyberattack on a government entity can be profound, affecting national security, public safety, and the delivery of essential services. Critical infrastructure sectors such as healthcare, energy, and transportation are particularly vulnerable, and disruptions can have widespread consequences.

 

Government agencies are custodians of vast amounts of sensitive data, including personal information of citizens and confidential national security information. Breaches in government systems can lead to identity theft, espionage, and even geopolitical conflicts, highlighting the high stakes for robust cyber risk management in the public sector. Recognizing cyber risk as a core operational risk involves:

 

1. Value: Government institutions must prioritize the protection of sensitive data and critical infrastructure. Understanding the value of these assets ensures that resources are allocated appropriately.

2. Velocity: Government entities must be prepared to respond quickly to cyber threats. Implementing real-time threat detection and response mechanisms is crucial to protect national interests and public safety.

3. Variety: The range of cyber threats faced by government institutions requires a comprehensive defense strategy, including protecting against insider threats and state-sponsored attacks.

4. Visibility: Government agencies need complete visibility into their IT environments to detect and respond to threats effectively. This involves continuous monitoring and threat intelligence sharing.

 

In conclusion, based on my experience spanning more than twenty years, cyber risk is a pervasive threat impacting both businesses and government institutions. Recognizing it as a core business risk is essential for protecting assets, maintaining operational integrity, and safeguarding public trust. By integrating the 4Vs—Value, Velocity, Variety, and Visibility—into their risk management strategies, organizations can better prepare for and mitigate the effects of cyber threats in our increasingly digital world.

© 2024 by Florida Technology Council.

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