Monday, 8 November 2021

Companies and directors increasingly vulnerable to costly cyber attacks.

Cybersecurity expert, Brendan Read, recently shared his insights with the Governance Institute of Australia’s Governance Directions Journal into the expected wave of shareholder class actions in response to surging ransomware attacks and inadequate defences.

The article highlights the growth in number and sophistication of cyber attacks, which leaves companies more vulnerable than ever. Brendan notes how this vulnerability has now extended to company directors, as these attacks often have crippling effects on company financials, reputation, supply chain and logistics. “Worryingly, successful ransomware attacks may have a devastating impact on company directors, causing the business’s stocks to plummet in value and aggrieved shareholders to seek compensation.”

In the article, Brendan discusses high-profile examples of recent shareholder class actions. With shareholders citing directors’ failures to protect from breaches and false or misleading statements regarding cybersecurity policies, he notes the intensifying pressure on directors to mitigate cyber risks. 

Brendan also discusses insights from recent industry reports, and his extensive experience in cybersecurity and investigations, emphasising the imperative for companies and directors to act now. “Senior leadership and boards must take ownership of the cyber strategy within an organisation and push for a cybersecurity planning process that seeks to build a multi-pronged cybersecurity system over time.”

Click here to read the article, as featured in the Governance Institute of Australia’s Governance Directions Journal (November 2021 issue).