In order to protect their customer’s confidential information and their reputation, the financial services industry must comply with regulations and standards designed to uphold this security. The intersection between cyber-security and compliance is a crucial consideration for any organisation within the sector.
Why Your Business Needs an Effective Cyber-security strategy
Cyber-threats are evolving. Cyber-criminals are finding new ways to bypass security protocols and target your data. One study conducted by the University of Maryland found hackers attack, on average, every 39 seconds. As such, an effective cyber-security strategy is essential for any financial services business.
The development of this strategy means you are taking a proactive approach to cyber-security, to reduce the likelihood of an attack and ensure you have the right response in the event of an incident.
Both of these components are essential. While it’s not possible to eliminate the threat to your business, how you respond following an attack will determine the impact in the long term. The failure to proactively plan for a breach could be catastrophic.
For your cyber-security strategy to be effective, you must also consider the roles and responsibilities of your employees. According to the Australian Cyber Security Centre (ACSC), many data breaches happen when hackers trick users into sharing their login credentials or installing malware onto their work devices.
A core building block of your strategy must include staff education. This should include instruction on the types of threats they will face, their responsibilities as well as practical training on recognising and correctly reacting to cyber-incidents.
How Cyber-security and Compliance Work Together to Protect Your Business
We regularly witness businesses treating cyber-security and compliance as two entirely separate processes. However, in the financial services industry, data security and compliance must go hand in hand. Not only is there a significant overlap between the two functions, but both also involve risk mitigation to protect the end customer. Although this protection should be a key feature in all of your organisation’s strategic plans, it’s absolutely crucial when it comes to cyber-security and compliance.
Both cyber-security and compliance are continuous processes, with interwoven requirements that evolve over time. Often, changes to compliance laws require an update to the cyber-security policies and procedures. For example, the introduction of the Notifiable Data Breaches (NDB) Scheme in 2018 meant organisations had to update their cyber-security strategy to ensure data breaches were reported within specified timeframes. Failure to do so would be costly, resulting in fines and reputational damage.
Firms that have international operations – especially those operating in the European Union and California – need to also factor compliance to GDPR (EU) and CCPA (California).
An integrated approach to compliance and cyber-security, therefore, provides many benefits. Importantly, it locks-in a coordinated approach across the business, eliminating conflict between the overlapping elements of each strategy.
Cyber-security and compliance effect all areas of the business, and bringing both elements together helps improve communication between teams with aligned roles and responsibilities.
Where digital risk is concerned, there’s little margin for error, especially when you’re responsible for personal financial data. It’s not enough to assume another team has the critical points covered – potentially leaving the business (and its customers) exposed. An integrated approach to digital risk clarifies these responsibilities, meaning one team is responsible for ensuring the appropriate strategy is rolled out across the board; communicating the associated processes and procedures with the rest of the organisation.
If you would like further information on how to plan for an integrated digital risk strategy or would like to speak to one of our experts to assess your needs, get in touch with us.