Press Release.

Half of financial institutions at risk of data breach due to poor data management

• 47% of senior executives in the US financial services sector say their organization is at risk of a data breach because data is poorly managed.
• Findings come as research shows US is the most impacted country for data breaches in the financial services sector.

USA, 24th May 2023: Around half (47%) of senior executives in the US financial services sector say their organization is at risk of a data breach because data is poorly managed, according to research from data and analytics strategy consultancy, Cynozure.

The data comes as Flashpoint’s Financial Threat Landscape report shows that the financial sector ranked second across all industries for data breaches in 2022, with the US being the most impacted country.

Cynozure’s research also exposes a lack of understanding of data in many financial institutions that may make them more vulnerable to attack, including around how it’s stored, managed, accessed, and used.

A comprehensive data strategy, right-sized data governance, and strong collaboration with security and data protection teams are vital tools in the broader armory of defense against data breaches, but even the most conscientious firms may not be completely bulletproof.

Educating employees about the importance of data management, ensuring they are aware of the role data plays in achieving its business objectives, and who in the business is responsible for managing it, are all important steps to take to minimize the risk of human error in contributing to a breach. Three in ten (31%) say the data world is too complex to understand, and one in seven (13%) say there is a lack of data literacy in the business. This is a clear call to action to develop self-sustaining ways to embed a data culture into an organization’s day-to-day operations.

Another way to mitigate the impact of a potential attack is to have a robust crisis management plan in place. An organization looking to implement this should start by identifying potential scenarios, analyzing the risk of each occurring, and calculating the consequences of it happening. This will differ from organization to organization, but a bank, for example, would likely class a leak of financial data and personally identifiable information as the most damaging.

Jennifer Agnes, Managing Director, Cynozure, comments: “The overwhelming majority (98%) of organizations say that using data effectively is central to running a successful business, but we’ve seen many lack the strategy, literacy, controls, and vision to generate that success. In the financial services sector, as in most sectors, data has the power to create better products and services, speed up response rates, drive slicker operations and support better management of risk. Good data management is at the heart of building trust, reducing the risk of breaches, and enabling innovation so it’s critical that steps are taken to ensure data is stored, managed, used, and protected correctly.”