In cybersecurity risk management, real-world risk management is applied to cyber risks. And cyber security risk management is the constant process of discovering, evaluating, and dealing with threats.
To manage risk, one must evaluate an event’s possibility and potential consequences before deciding on the best action, such as avoiding, transferring, accepting, or mitigating the risk.
New cyber threats, data breaches, attack methods, and newly uncovered vulnerabilities appear yearly. The strategy for dealing with cyber threats is the same regardless of zero-day vulnerabilities like EternalBlue: a solid cybersecurity risk management framework with a systematic risk assessment and response approach.
Therefore, you must decide the security measures (prevent, deter, detect, correct, etc.) to reduce cybersecurity risk. All risks cannot be removed entirely, and you don’t have the personnel to deal with them. Continue reading this article to discover what you should know about cyber security risk management.
Table of Contents
What is Cybersecurity Risk Management?
Cybersecurity risk management is discovering potential threats, evaluating their impact, and preparing for possible responses. Regardless of the size or industry, every firm must create a cybersecurity management plan.
But it’s also crucial to understand that all risks cannot be removed, even when they are foreseen. However, even in those situations, your firm can take precautions to lessen the potential damage of a cyber threat.
Companies must embrace digital transformation to stay competitive, but this is easier said than done when security issues are considered. Thus, effective cybersecurity risk management enables organizations to adopt innovative solutions confidently and use third- and fourth-party vendors without worrying about jeopardizing their cybersecurity posture.
Why is Cybersecurity Risk Management Important?
Expanding IT environments and the changing cyber threat landscape has made organizations more vulnerable to cybersecurity attacks than they can handle. As a result, companies must prioritize where to invest their few resources to manage cybersecurity risk.
So, cybersecurity risk management allows organizations to make these choices in an organized, data-driven manner. The organization determines the dangers that make up the most significant risk and focuses its resources there rather than taking a first-come, first-served approach.
Furthermore, an organization can avoid wasting resources on insignificant threats and maximize the return on its security investment by evaluating threats based on risk.
Benefits of Cyber Risk Management
Cybersecurity risk management can make a corporate cybersecurity program more effective and efficient. Meanwhile, the following are a few advantages that cyber risk management can offer to the company:
Enhanced Security: A cybersecurity risk management program aids a company in determining the most significant dangers it faces. A company can improve its security posture by addressing the biggest attacks using a prioritized list of cybersecurity threats.
Improved Cybersecurity ROI: A cyber risk management program is created to ensure that an organization concentrates its risk mitigation efforts on the biggest threats to the business. This strengthens cybersecurity ROI by ensuring that resources are used to tackle the greatest threats to the organization and keeping resources from being squandered on minor threats.
Cybersecurity Insurance: The prevalence of ransomware, phishing, and other cyber threats has increased the difficulty and cost of obtaining insurance coverage. A solid cybersecurity risk management program can assist a company in proving that it poses a low risk and lower insurance costs.
Regulatory Compliance: Data privacy laws frequently require Cybersecurity risk management programs, which usually focus on protecting sensitive data. Therefore, employing cybersecurity risk management enables a business to be sure it is fulfilling its compliance obligations.
The Cybersecurity Risk Management Process
The cybersecurity risk management process can be divided into four stages/steps:
Identify: Before managing risks; a company must understand that they exist. Thus, the first stage in the cybersecurity risk management process is to audit a company’s IT environment and security framework to identify possible risks that need to be handled.
Assess: The organization’s activities are threatened by various risks. Attacks against critical, for instance, are more likely to significantly impact the corporate database server than employee workstations and other lower-priority systems. So, companies can calculate risk based on the possibility and effect of a threat arising and prioritize threats based on this information.
Remediate: After creating a list of risks with a priority ranking, an organization can take action to deal with them. Meanwhile, standard risk management techniques include remediation (complete risk elimination), mitigation (reducing the risk effect or possibility), transference (risk transfer to another party), and acceptance (doing nothing).
Review: A company should regularly conduct risk analyses and evaluate the efficacy of its current controls. This enables the business to address failing controls or growing risks and helps to ensure that risk prioritizations are current.
Cybersecurity Risk Management Framework
There are various frameworks for cybersecurity risk management, and each one offers standards that organizations can use to recognize and reduce risks. Senior management and security leaders use these frameworks to evaluate and enhance the organization’s security posture.
Additionally, organizations can assess, reduce, monitor, and define security procedures and processes to combat threats with a cyber risk management framework. Here are a few popular cybersecurity risk management frameworks:
NIST CSF
The NIST CSF (National Institute of Standards and Technology Cybersecurity Framework) is a common cybersecurity risk management framework. Again, the NIST CSF offers a comprehensive collection of best practices that regulate risk management. It defines critical activities and results relative to the primary functions of cybersecurity risk management.
ISO 27001
The ISO/IEC 270001 was developed in collaboration between the International Electrotechnical Commission (IEC) and the International Organization for Standardization (ISO). Furthermore, the ISO/IEC 27001 cybersecurity framework provides a certifiable collection of standards to manage information system risks systematically. Companies can also use the ISO 31000 standard, which offers rules for organization risk management.
DoD RMF
The Risk Management Framework (RMF) for the Department of Defense (DoD) outlines the standards that DoD organizations must follow when evaluating and managing cybersecurity threats. And the six main steps in the RMF breakdown of the cyber risk management plan are: categorize, select, implement, assess, authorize, and monitor.
FAIR Framework
Enterprises can gauge, analyze, and comprehend information risks using the Factor Analysis of Information Risk (FAIR) framework defined for this purpose. The objective is to help businesses make informed choices while developing cybersecurity best practices.
Best Practices For Cybersecurity Risk Management
Organizations can take several actions to guarantee efficient cybersecurity risk management continuously. Here are five best practices that businesses should follow while managing their IT ecosystems:
1. Establish a company culture.
Your company’s culture should be considered as you build your cybersecurity risk management program. A cyberattack now costs over $1.1 million on average, and 37% of the organizations hit suffered reputational harm. For this reason, you must build a cybersecurity-focused culture that permeates every level of the organization, from the executive suite to the part-time personnel.
2. Share responsibilities
Everyone’s top priority is to maintain security. The IT or security departments cannot bear the responsibility of ensuring cybersecurity. Also, your security strategy must include your hardware, software, and human elements. Distributing responsibility throughout your company ensures that each employee knows the hazards connected to a cyber attack and is equipped to respond to one as soon as it occurs.
3. Educate employees
Employee education is essential for fostering a security awareness culture and ensuring everyone knows the cybersecurity tools and systems you want to deploy. Thus, all levels of staff should receive thorough training on the risks that have been identified and the policies and mechanisms that are intended to reduce those risks.
Employees also need the tools to identify malware and phishing emails, understand which types of data shouldn’t be sent over email, and know who to notify if they’ve uncovered a security concern to protect against these human-related breaches. So, creating a culture of security within the organization entails doing things like this.
Finally, employees should learn about corporate policies and proper working processes via a robust security awareness program.
4. Share information
There must be communication about cybersecurity dangers across all levels and departments. And all relevant parties, especially those involved in your company’s decision-making, must be informed before implementing new security measures and apps or discussing cybersecurity-related issues. Meanwhile, the potential business impact of pertinent cyber threats must be made evident to all relevant parties, and you must keep them informed and involved in continuous discussions and activities surrounding the cyber posture of your company.
5. Establish a cybersecurity framework.
Implementing the proper cybersecurity framework for your business is crucial. The standards accepted by your industry typically set this. Moreover, the cybersecurity frameworks that are most frequently used are:
- PCI DSS (Payment Card Industry Data Security Standard)
- ISO 27001/27002
- Center for Internet Security (CIS) Controls
- NIST Framework for Improving Critical Infrastructure Security
Frequently Asked Questions
The five C’s of cybersecurity are five areas that are important to all organizations. They are change, compliance, cost, continuity, and coverage.
Longevity Risk.
Inflation Risk.
Sequence of Returns Risk.
Interest Rate Risk.
Liquidity Risk.
Market Risk.
Opportunity Risk.
Tax Risk.
Avoidance.
Retention.
Spreading.
Loss Prevention and Reduction.
Transfer (through Insurance and Contracts)
Conclusion
Cyber risk management and its framework are important because they help a business evaluate its cyber security risk profile. This information can be used to make informed choices about allocating resources and prioritizing security measures.
Furthermore, it is essential to any company’s overall security posture. By executing a comprehensive risk management process, organizations can reduce the risk of a cyberattack and shield their critical assets.
References
- securityscorecard.com – Cybersecurity Risk Management: Definition, Framework, & More