Cyber Attacks on businesses is costing investors £42 billion loss says a study commissioned by cyber security firm CGI and conducted by Oxford Economics. The study also confirmed that a company which is listed in FTSE 100 Index gets worse off by an average of £120 million after a breach.
Oxford Economics made the study based on the analytics achieved by data using the Gemalto Breach Index- a registering database of publicly disclosed cyber security breaches by public and private utilities.
The researchers carried out their research on some 315 breach events and examined in total with a focus on 65 severe data breaches which occurred in 2013 across seven globally known stock exchanges.
It was revealed in the study that investors lost £42 billion due to cyber incidents occurring on their public domain.
What’s more interesting in this hack data analysis is the highlighted fact of investors who have started punishing companies more harshly for being cyber attacked in recent years. The list includes companies such as Talk Talk, Yahoo, and Tesco Bank.
Economists are treating this loss as a serious concern for businesses now and in near future. They already predict that attacks in cyberspace could bring in the vast amount of financial implications to many businesses in a negative way.
For instance, Yahoo which revealed early last year that it is inclined in selling its web services business to Verizon had to give a discount of $350 million to the telephone giant due to the cyber attack launched by some cyber crooks which led to the leak of data of more than 500 million Yahoo users. Finally, Verizon locked the deal for $4.8 billion instead of $5.2 billion- Yahoo was once worth over $100 billion.
The survey conducted by CGI has also confirmed that cyber criminals are showing a lot of interest on financial institutions because of the fact that they can easily mint money out of them.
Thus markets are now starting to recognize the reality that cyber attacks destroy the value of the company. And so, this will force venture capital firms and credit rating agencies to set a threshold cyber attack value while assessing firms.
If we take companies in the UK for instance, it is going to be a tough time ahead for them in future. As the General Data Protection Regulation in EU, despite Brexit, plans to impose heavy fines of up to 17 million or 4PC of turnover, whichever is larger, on companies which witness a data breach.
So, will Trump government follow the same next year…..?
