Published on January 25th, 2023 📆 | 4911 Views ⚑0
Orgs Must Prepare for SEC Cybersecurity Requirements Aimed at Boards
Enterprises might want to spend the next few months checking and bolstering their boards’ cybersecurity chops—because by the end of 2023, the Security and Exchange Commission (SEC) is expected to finalize its proposal requiring them to attest to their boards’ cybersecurity acumen—as well as disclose their cybersecurity oversight efforts and information on attacks.
All this is an effort to shift some cybersecurity accountability to boards, a move that is not wholly unexpected. Organizations have been urged to add cybersecurity expertise to those governing bodies to bolster their cybersecurity postures, get strategies approved and funded more easily and apply much-needed accountability.
“Our 2022 U.S. Cybersecurity Census indicates that the average cybersecurity leader is faced with 42 attacks each year—three of them successful—and the majority of those surveyed anticipate that number will only increase in the coming year. However, the research also shows widespread demand for cybersecurity talent as the international IT workforce shortage endures,” said Darren Guccione, CEO and co-founder at Keeper Security. “The board of directors and fellow business leaders must support their CISO’s priorities and needs, particularly when they’re faced with a cyberattack or data breach.”
Oversight by boards “has increased dramatically in recent years and can be expected to continue in terms of the members’ situational awareness of potential challenges and the current state of the organization’s cybersecurity posture,” said Tim Morris, chief security advisor, AMER, Tanium.
That trend heated up as COVID-19 sent employees home to work. “The pandemic changed the paradigm for cybersecurity with remote work dramatically expanding attack and threat vectors. And wars placed even greater onus upon boards for heightened scrutiny and oversight in the midst of turmoil,” said Morris.
Cybersecurity touches nearly every aspect of a business and vigilance can be the difference between staying up-and-running during an event or shuttering operations. “Cybersecurity must also be a tightly integrated component of disaster recovery (DR) and business continuity plans (BCP). For instance, what happens if/when disruptions to supply chains occur? Or internal communications are no longer operable or reliable due to a suspected compromise?” said Morris. “Boards need to be equipped to ask the right questions and invest in contingency plans that will maintain continuity and minimize disruptions.”
Morris noted that “the threat and existence of wars raise the stakes when trying to run an organization,” and explained that “boards, in the past, have been limited to managing these threats by firing and/or hiring CEOs and CISOs.”
He believes that “regulatory actions, such as the steps being taken by the SEC, help create a heightened sense of awareness by removing ‘plausible deniability’ and placing accountability when failures occur.”
But Joseph Carson, chief security scientist and advisory CISO at Delinea, noted that “the security gap is not only increasing between the business and attackers, but also the security gap between the IT Leaders, business executives, and the board of directors. While in some industries this is improving, the issue still exists.”
Until organizations “solve the challenge of communicating the importance of cybersecurity to the executive board and business,” Carson said, “IT leaders will continue to struggle to get the needed resources and budget to close the security gap.”
Mika Aalto, co-founder and CEO at Hoxhunt, believes that “in 2023, communication skills will become more relevant as human risk is mitigated with security behavior change programs, whose results must be analyzed and their value communicated effectively to the board.”
This is critical, Aalto said, “for getting investment into security programs that lower risk at its greatest source, the human element.”
But the woes are likely to continue until business and IT align. “What’s important for company boards and leadership to understand is that data security requires the business (the lines of business that rely on the business applications which store sensitive data) and IT (responsible for protecting and securing broader systems) to work together to create effective policies for securing sensitive data,” said Mike Puterbaugh, CMO at Pathlock.