What Every CFO Should Know About Security Breaches


By Tim Wilson April 19, 2013
Complete Article: Every CFO Should Know About Security Breaches

TYSONS CORNER, VA. — CEOs and CIOs have gotten religion about cybersecurity, but what about those who hold the purse strings? Experts say they need a hard lesson, too.

In a panel called “What Every CFO Must Know About Cyber Threats and Security” held here last week, some well-known security executives spoke to chief financial officers (CFOs) about the costs of data breaches — and the benefits of proper preparation.

The panel, sponsored by the Northern Virginia Technology Council, offered CFOs some tips on what they should pay attention to when the security discussion comes up.

“The Ponemon Institute estimates that the cost of the average data breach — the average, mind you — is over $5 million,” said Len Moodispaw, CEO of KEYW, a consulting firm that focuses on cybersecurity and counter-terrorism defense. “What that says is that it pays to make the right [security] decisions from a financial perspective.”

Nick Savage, a special agent for the FBI’s cybercrime branch, agreed. “Five million dollars may be simply the cost of doing business if you’re a large organization, or if you are very small, it could put you out of business,” he said. “The threat actors we see are very persistent and very patient, so the [financial] decisions you make need to take that into account.”

The panelists encouraged CFOs to be willing to spend money on security — but to be educated about what they are spending it on.

“In some ways, security is IT’s revenge on the finance department — they say, ‘You don’t understand what we do, so we’ll spend your money however we like,” joked Kevin Mandia, CEO of security forensics firm Mandiant. “As a CFO, you need to understand something about the security issue. For example, you can invest in a compliance program, or you can invest in an actual security program. A full security program will cost you more, but in the end, it may save you more.”TYSONS CORNER, VA. — CEOs and CIOs have gotten religion about cybersecurity, but what about those who hold the purse strings? Experts say they need a hard lesson, too.

In a panel called “What Every CFO Must Know About Cyber Threats and Security” held here last week, some well-known security executives spoke to chief financial officers (CFOs) about the costs of data breaches — and the benefits of proper preparation.

The panel, sponsored by the Northern Virginia Technology Council, offered CFOs some tips on what they should pay attention to when the security discussion comes up.

“The Ponemon Institute estimates that the cost of the average data breach — the average, mind you — is over $5 million,” said Len Moodispaw, CEO of KEYW, a consulting firm that focuses on cybersecurity and counter-terrorism defense. “What that says is that it pays to make the right [security] decisions from a financial perspective.”

Nick Savage, a special agent for the FBI’s cybercrime branch, agreed. “Five million dollars may be simply the cost of doing business if you’re a large organization, or if you are very small, it could put you out of business,” he said. “The threat actors we see are very persistent and very patient, so the [financial] decisions you make need to take that into account.”

The panelists encouraged CFOs to be willing to spend money on security — but to be educated about what they are spending it on.

“In some ways, security is IT’s revenge on the finance department — they say, ‘You don’t understand what we do, so we’ll spend your money however we like,” joked Kevin Mandia, CEO of security forensics firm Mandiant. “As a CFO, you need to understand something about the security issue. For example, you can invest in a compliance program, or you can invest in an actual security program. A full security program will cost you more, but in the end, it may save you more.”

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