The United State Securities and Exchange Commission (SEC)
\nreleased a new guidance on cybersecurity last month, stating that cybersecurity
\nrisks must now be disclosed. In the past, the SEC has required publicly traded
\ncompanies to disclose material risks and events information that would be
\npertinent for a person to know before investing in the company.<\/p>\n
But before this new guidance, it was not clearly stated that So now, a company must be upfront about any problems they
\ncybersecurity information was to be included in this information. According to
\nan article in the Washington
\nPost<\/a>, This SEC guidance is critical because it allows market participants
\nto weigh cybersecurity as an investment factor. It is generally understood that
\ndisclosing material breaches such as the significant loss of a companys
\nintellectual property will affect the value of a company, because existing or
\npotential investors will reconsider their investment decisions. Without
\ndetailed public information about these events, investors are unaware of the
\nrisks to which companies are exposed. And without pressure from investors,
\ncorporate officers are less likely to change their risk-management practices.<\/p>\n
\nhave had as a result of poor fraud
\nprevention tools<\/a>.<\/p>\n