How SOAR tools can help companies comply with the latest SEC cybersecurity disclosure rules
In July 2023, the Securities and Exchange Commission (SEC) voted to adopt new cybersecurity rules and requirements for all public companies to address risks. Among the new rules were updated requirements for filing Form 8-K and new disclosure obligations on Form 10-K.
Under the new regulations, public companies must report Form 8-K within four business days after determining that a significant cybersecurity incident has occurred.
The submitted Form 8-K must describe the following:
- significant aspects of the nature, scope and timing of the incident; and
- A material impact, or could reasonably be expected to have a significant impact, on the Company, including its financial condition and results of operations.
Cyber Risk Management Process
In addition to updating Form 8-K, new SEC regulations require disclosure on Form 10-K of the processes used to assess, identify, and manage cybersecurity threats. In disclosures, companies must also describe the board’s oversight of cybersecurity risks and management’s role in assessing and managing cybersecurity risks. The cybersecurity disclosures added to Form 10-K are important because they mean a significant expansion of a company’s disclosure obligations.
Tips for building a culture of risk awareness
Over the past decade, cybersecurity breaches have grown to be one of the biggest risks to businesses across all industries and sectors. In fact, according to the 2023 Cost of a Data Breach report, the average cost of a breach reached a new high of $4.45 million, up 15.3% from 2020.
With the adoption of new SEC regulations, companies must become more prepared to have a very comprehensive incident response process. Keeping your company safe is not just the role of the Chief Information Security Officer (CISO), security, and IT teams. From the board of directors to executives to line staff, everyone has a responsibility to protect against and respond to threats. Because nearly every team in an enterprise operates with sensitive systems and/or data that could put the company at risk, it is important to spread awareness of cybersecurity risks throughout the organization.
Security Orchestration, Automation, and Response (SOAR) solutions help your organization’s SOC manage threat response efficiently and decisively. Security teams can manage risk by leveraging dynamic playbooks and automation for investigation and response, and timestamping key actions for reporting, legal, and compliance requirements. Stronger risk management can help organizations not only protect against security incidents, but also ensure investors have a robust incident response process in the event of a breach.
IBM Security QRadar SOAR provides clear visibility into incidents, making it easier to access the information you need to comply with these new SEC rules. It also provides CISOs with a clear picture of high-priority security incidents that can be easily shared with other executives. QRadar SOAR’s Breach Response module also helps organizations prepare for and respond to security breaches by integrating privacy reporting efforts into the overall incident response playbook. Helps users address regulatory requirements by fostering collaboration between privacy, HR, and legal teams.
With new SEC regulations, it is important for organizational leaders to engage in regular conversations about their security posture and incident response, not just when a security incident occurs. With new rules for reporting security incidents within a short period of time and the inclusion of incident response processes in annual reports, it has become more important for both CISOs and other security and IT leaders to engage C-suite executives and boards of directors. Secure conversation.
Integrating the right tools, such as SOAR, to continue the conversation on these important topics can help CISOs effectively explain the business’s risk landscape to C-suite executives and the board of directors in a way that establishes common principles. This is the language that starts the discussion. Initiating a conversation to include company leaders, not just when incidents occur, but on a regular basis can help guide budgets and visibility to fill large gaps, helping protect your company from security incidents like future data breaches. . Cybersecurity risks are a very real part of business today, but these risks can be mitigated if companies comply with these new disclosure requirements, use the right automation tools, and regularly address cybersecurity risks with company leadership. .
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