What is cyber risk? Explained | Balbix
12/03/24, 22:38
What is cyber
risk?
The US National Institute of Standards and Technology (NIST) defines cyber
risk as the risk of depending on cyber resources (i.e., the risk of depending on a
system or system elements that exist in or intermittently have a presence in
cyberspace).
If this definition felt like a drink from a fire hydrant, don’t worry. Let’s start from
something more basic. How would you define ‘risk’? Simply put, ‘risk’ is a
situation involving exposure to danger. For example, someone driving a car
without a seatbelt is in a risky situation.
If I was to guess, you are reading this blog from the comfort of your home or
office, and probably feeling safe (and not at risk). Why so?
Here are a few reasons:
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What is cyber risk? Explained | Balbix
12/03/24, 22:38
Your home is locked so outsiders can’t get in.
The front door is strong making it hard for anyone to break in.
The camera by your door provides visibility into anyone trying to get in.
The rooms may have windows and balconies, but you have an option to lock
them.
You have an alarm system to alert security in case any intruder does
manage to enter.
The police have not alerted you about any serial killer at loose.
The smiling weather person on TV is not forecasting a tornado.
So, what does this have to do with cyber risk
?
Organizations today rely heavily on information systems and these systems are
analogous to your valuables at home. An enterprise’s “valuables” are the
Product
Solutions
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Resources
Company
Request
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What is cyber risk? Explained | Balbix
12/03/24, 22:38
Request
Product
Solutions
Resources
Company
various assets,
every piece
of software and
hardware, whether
mobileaordemo
fixed,
in-the-cloud or on-prem, managed or unmanaged, as well as IoTs, industrial
control systems and more, and the data/information on these assets.
Much like you deploy measures (e.g., doors, windows, locks, alarm systems) to
protect your belongings, enterprises need control mechanisms to allow or deny
access to resources based on who is trying to access the resource. For
example, you don’t want your co-worker to be able to read your compensation
details in the HR system, while it is ok for the VP of HR and your boss to have
access to this information. An online intruder (“cyber attacker”) trying to get
inside your organization’s information systems, obviously without authorization,
is akin to a burglar trying to break in.
Going back to the definition at the top of this page: cyber risk is the expected
loss – financial or otherwise, from cyber attackers if/when they manage to
break in.
How much money should your company expect to pay in ransom if 1/3 of your
customer data was stolen as part of a ransomware attack, and what is the
likelihood of such an incident happening this year? Would you also have to pay
a fine to the authorities in Europe due to a GDPR violation? How is this
expected loss different if all the attackers could manage to do was to bring
down your company’s website? And how likely is that scenario?
As you can imagine, this topic of cyber risk becomes very interesting with
different techniques for understanding risk types and scenarios, estimating
likelihood of occurrence and quantifying risk, and mitigating/managing risk.
Key quotes about Cyber risk
‘There are only two types of organizations: Those that have been hacked
and those that don’t know it yet!’- John Chambers
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What is cyber risk? Explained | Balbix
12/03/24, 22:38
“It takes 20 years to build a reputation and a few minutes of cyber-incident
to ruin it.” – Stephane Nappo
“The knock-on effect of a data breach can be devastating for a company.
When customers start taking their business—and their money—elsewhere,
that can be a real body blow.” – Christopher Graham
Frequently Asked Questions
Should I worry about cyber risk?
What are the different types of cyber
risk?
How is cyber risk calculated?
How is cyber risk managed?
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What is cyber risk? Explained | Balbix
12/03/24, 22:38
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