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A very important read for CISOs, Board Directors and Officers.
In February 2023 we wrote a paper with respected U.S Attorney Rachel V. Rose, JD, MBA and Educationalist Ted Dziekanowski entitled ‘U.S and EU cybersecurity regulation enforces cybersecurity risk management ‘Left of Bang’ and into the financial statements of covered entities’. (https://lnkd.in/eM4guVCb). Focusing on regulation such as the SEC Final Ruling, EU NIS 2 and DORA answering the question ‘can an organisation rely on cyber insurance as the sole risk treatment?’
Cyber regulation pushes cyber risk management ‘Left of Bang’, into the board rooms of covered entities. Cyber regulation including the SEC cyber ruling (effective 5th September 2023) shifts cyber risk management formally into the board room, as a legal and compliance issue to resolve. An issue requiring boards to mitigate cyber risk through their financial statements, rather than rely on cyber insurance, and now D&O.
Cyber regulation has a significant effect on covered entities such as those domestic and FPIs listed on U.S Capital Markets, EU CNI providers and EU Financial Institutions. Effects that could be beneficial to the Insurance industry, requiring covered entities to demonstrate cyber risk compliance, or reasonably expect claims to be declined. Declined for failure of regulatory compliance, further reinforcing boards of covered companies to implement material, adequate and reasonable cybersecurity risk management.
If cyber is removed from D&O policies the ‘Fire Blanket’ that D&O insurance provides Directors and Officers in the event of a cyber incident or cyber regulatory action is disolved. Personal and corporate legal and compliance risk increases. (Uber case, Drizzly case) This an important consideration for CISOS that may rely on D&O insurance as a backstop to cover legal costs.
Our thought leadership is a demonstration of our knowledge and experience in the areas of cyber, risk and law (U.S). We have over 75 years of cybersecurity, risk, cyber legal compliance, cyber education and government liaison experience. Supporting boards meet these complex cybersecurity risk management compliance challenges. Please reach out if you would like to discuss further.
Bob Dix
#cybersecurity #cyberriskmanagement #cyberinsurance #directorsandofficers
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