New WSJ Pro Research Shows Only Three in 10 Directors Rate their Board's Ability to Oversee a Cyber Crisis Highly
New findings ahead of SEC rule changes also show one in four boards lack director-level cyber expertise.
New York, NY (March 20, 2023) — WSJ Pro, the professional arm of The Wall Street Journal, and the National Association of Corporate Directors, the authority on boardroom practices representing more than 23,000 board members, today released a summary and detailed findings of their research focused on cybersecurity risk management.
Upcoming regulatory changes from the U.S. Securities and Exchange Commission around cybersecurity risk could have a significant effect on how boards approach their oversight responsibility. This research sheds light on how boards currently interact with management, how companies are responding to the expected SEC rules around board-level cybersecurity expertise, the ability for boards and management to effectively manage risk and the key challenges boards face.
Findings from the study include:
- Despite more than three-quarters of boards having at least one cyber expert among the directors, only three in 10 directors rate their board’s ability to oversee a cyber crisis highly.
- More than one-third of directors representing the energy and utilities industry said their board lacks a cyber expert, highlighting vulnerability in the critical infrastructure sector.
- One quarter of boards without specialist cyber knowledge plan to hire a cyber expert as an independent director, including 31% of public companies, but most are not prioritizing the recruitment.
- Board directors largely have confidence in management to effectively deal with cyber risk. Sixteen percent rated management ‘excellent’ and 43% rated management ‘very good’.
- Tabletop exercises involving cyber scenarios are lacking. Less than half of all respondents said their board had participated in one or more during the last 12 months.
To access the full reports, visit https://www.wsj.com/pro/cybersecurity/research.
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