In your everyday life, you are managing some form of perceived risk, and in business, it is no different. When you purchase car insurance; you’re managing the risk of having an accident. When you purchase health insurance; you’re managing the risk of getting sick. When you can identify your company’s cyber risk, you can better manage the risk of a cybersecurity-related incident. 

The question on most business owners’ minds is, ‘how can I identify my company’s cyber risk to mitigate vulnerabilities?’ 

According to Allianz risk barometer (An annual report identifying the top corporate risks for the next 12 months and beyond), cyber perils outranked Covid-19 and broken supply chains as the top global business risk in 2022.  

Realistically, due to internet access and the presence of some type of IT infrastructure, any business is vulnerable to cyber-attacks. Yet, to comprehend how significant the risk is and to be able to manage it, you first need to understand cyber risk.

What is cyber risk?

A Cyber risk is the risk of damaging impact to your business if your information systems fail or are interrupted. This can come with fiscal loss, business disturbance, or reputational damage.

The Australian Securities and Investments Commission states “Cyber security and resilience are essential to all organisations operating in the digital economy. In Australia, a broad regulatory framework places obligations on businesses, and the people that run them, to properly manage cyber risk.” 

Efficient cyber risk management needs to be an integral part of any overall business strategy and should include more than deploying anti-virus software or securing firewalls. Your business reputation, money, and sensitive information could all be at risk, increasing the need for managed security.

What is a cyber security risk assessment?

Cyber risk assessments are an essential component of cybersecurity. By undertaking a cyber risk assessment, your company can better understand which risks exist, what their potential impact may be, and how you can mitigate those risks. 

Allowing you to make the best choices about how and where to execute security controls to reduce the overall risk to your business.  

Why is it important to identify cyber risk? 

Cyber security solutions are becoming highly sought after as technology advances and threats are targeting businesses in all shapes and forms. Managed cyber security is one way to ensure your business is protected, but why is it important?

  • Reduce potential financial loss due to cyber risk. 
    Conducting risk assessments may reduce or prevent financial losses and any interruptions to business services.  
  • Prevents data loss/breaches. 
    Your business assets are not only limited to their physical assets. It also includes intellectual property and other sensitive information. 
  • Ensures compliance. 
    In Australia, there are specific regulations that businesses must follow to ensure data is well protected.  
  • Protect your business reputation.  
    When your business is breached or personal information is compromised, you run the risk of losing valuable client relationships due to a break in rapport and trust.  

A new Privacy Legislation Amendment (Enforcement and Other Measures) Bill 2022 passed that sees an increase of maximum penalties for serious or repeated privacy breaches from $2.22 million penalty to whichever is greater than: $50 million; three times the value of any benefit obtained through the misuse of information; or 30 percent of a company’s adjusted turnover in the relevant period. 

How to identify your business cyber risk in 5 steps.

Step 1: Conduct a cybersecurity assessment

This step involves evaluating your company’s current cybersecurity posture and is critical to any cyber-security plan. Here, you can identify any vulnerabilities or weaknesses that could be exploited by cybercriminals.

Step 2: Identify critical assets

The next step is to identify what your most important business systems are. From there, you can work out what kind of threats you may face. 

For most businesses, the threat of an attack against a system that’s accessible over the internet is common.  Attackers assess your vulnerabilities through means of scanning your web server, using automated tools, or attempting to access your or your staff’s email accounts from a database of compromised passwords or phishing emails. 

However, not all cyber threats and vulnerabilities are malicious. Human error is responsible for 82% of data breaches. When you identify what risks can take place, you can explore better ways of protecting your business.  

Step 3: Determine the likelihood and impact of a cyber-attack

Assessing a company’s cybersecurity risk is like assessing any other business risks to which the company may be subjected. The two main elements in assessing risk are determining the likelihood of the risk and considering the impact if the event were to occur. 

By outlining the possible threats and using a numbering system, you can rank the threat level from 1 – Most unlikely to 5 – Extremely likely. This gives you an indication on where to make changes or monitor for risks.

Step 4. Implement appropriate controls

Once you are confident in your assessment and the results received, your company can start to implement any safeguards and controls needed to protect against cyber attacks. This may include measures such as firewalls, application control, and security policy. 

Step 5. Monitor and test 

Staying on top of your cyber-security is imperative to keeping your company safe. This requires regular monitoring and testing the effectiveness of the controls in place. Regularly checking everything is functioning properly allowing you to detect and respond to potential threats. 

Potential threats may be: 

  • Unauthorised access to data.
    This can happen due to malware, direct hacking, or potentially an employee accessing business data either knowingly or unknowingly.
  • Failure to follow proper security protocols. 
    Administrative privileges or transferring information over unsecured networks can lead to a mishandling of data.   
  • Loss of data. 
    Failure to reproduce or maintain data appropriately.
  • Loss or disruption of service. 
    This can be caused by a Denial-of-Service (D-o-S) attack. 

Ways to help mitigate cyber risk

It is now time to implement new measures alongside identifying weak points to minimise cyber threats.  

The following steps are ways you can get the process started:  

  • Set strong passwords and use MFA.  
    Multi-factor authentication (MFA) is a security measure that is more reliable than a standard password. MFA can double- and triple-verify a user’s identity prior to accessing data.
  • Update device firmware and drivers. 
    Make sure all device firmware is up to date. Microsoft offers a free tool that allows you detect whether the Microsoft products on your network need updating. 
  • Use encryption. 
    Using encryption allows you to keep hidden the content of a message by translating it into code.If you receive a threat in your system, the encrypted data they intercept will be unintelligible.  
  • Install firewalls.  
    A firewall is a security system that detects, and controls network traffic based on a set of security rules. Firewalls usually sit between a trusted network and an untrusted network. 

Ensure you make routine checks to see if new threats arise and if current practices are still effective within your business and update your plan regularly.  

Would you like to strengthen your cyber-security process?

If you find the process daunting or overwhelming, feel free to enquire about our cybersecurity solutions. To get a more in-depth look into how your business can implement cyber security in your business, download our FREE eBook here.