Many businesses still don’t have the right protection against cyber attacks, know the rules around the General Data Protection Regulation (GDPR) or realise the risk to their company, according to a new poll from Aon.
The poll of small- and medium-sized entities (SMEs) and micro businesses showed that more than half are confused by or even unaware of the rules around GDPR, while more than eight out of 10 don’t see cyber attacks or data loss as a significant risk for their business.
The poll comes on the back of a survey earlier this year from the National Cyber Security Programme that revealed nearly half of UK businesses experienced at least one cyber security breach or attack in 2017, and 66% of SMEs and 45% of micro businesses were shown to have been victims.
GDPR, which came into force in the UK in May, drastically increased potential penalties on companies found to have misused or mismanaged clients’ personal data.
Yet the attitude of SMEs to cyber security is worrying, with one in five saying they have no plans to invest in it in the coming year, according to Chris Mallett, broking manager for Aon, which commissioned the recent poll.
According to Dr Emma Philpott from the UK Cyber Security Forum, GDPR has caused companies to focus on this issue but the concern is, she said, this was for too many a short-lived effect.
Philpott is also CEO of the IASME Consortium, an accreditation body for assessing and certifying against the government’s Cyber Essentials Scheme. “As soon as the deadline for GDPR passed, too many thought that was job done and that’s where their responsibility ended,” she said.
“The big data breaches in the press help to raise awareness but they can also cause data breach fatigue; a sense that the time, cost and high-end security to tackle this is complicated and overwhelming,” Philpott said. “There is a lot of misunderstanding of risks, and still a worry among SMEs that it must be complicated. It is not always about high-end security. It’s about having the basics in place to protect you from indiscriminate attacks. Educating staff takes time but doesn’t cost anything at all.”
Mallett said there are particular vulnerabilities with the growth of flexible working, with staff accessing data on-the-go.
But the ‘bring your own device’ culture, which sees business leaders and their teams using their personal computers, smartphones or tablets for work purposes, can expose companies to the increased risk of a cyber security breach if data is not properly encrypted and controlled, Mallett explained.
Aon’s poll of 1,000 SMEs carried out through OnePoll indicated around one in four allow members of staff to use their own devices for work. “What’s more, it revealed one in three don’t see personal information stolen as a result of cyber attack or fraud as a data breach, with the same number admitting they’re unaware of the time limit on reporting such a loss, exposing their companies to the risk of huge fines,” Mallett said.
“I don’t think companies realise how awful the impact of a breach can be or the amount that actually has to be done” Philpott said. “It involves everything from mandatory reporting to keeping affected customers or clients informed. It can leave those clients fearful and cause reputational damage. It’s not just about replacing laptops or paying a fine.”
While many companies have professional indemnity insurance (PII) in place, there are often significant costs that professional indemnity won’t pick up, added Mallett, who points to the poll results showing general confusion about the likely financial impact of a cyber attack (more than four out of 10 admitted they had no idea).
“Around one in seven believe the costs are covered by their PII and more than three in 10 choose not to insure against cyber attacks or fraud,” Mallett said.
“Although fines are expected to be issued as a last resort, they can be up to €20 million or 4% of annual turnover,” Mallett explained. “The risk presented by non-compliance with GDPR has the potential to bring a small business to its knees.”
Mallett said that companies are surprised by how affordable cyber insurance is. “Specialist policies not only cover for the cost of responding to a breach, but also the costs of damages you’re legally liable to pay in the event of a breach or security failure, as well as associated legal costs.”