Data security is important because certain businesses maintain data containing exceptionally sensitive information that would create severe liability risks if compromised, particularly data that’s maintained for a financial environment. Information that’s used to develop accounting records, such as stock ownership, profit distribution, profit-sharing, joint venture agreements or salary and wage information must have strict security to prevent unauthorized access from both third parties and internal staff members.
The Role of Financial Managers as it Relates to Data Security
With all the networking and file sharing, who is responsible for securing critical financial data? Corporations often look to a CFO or other financial management level employees to get involved with preventing a breach in their data security.
Securing information on a Private Cloud platform has proven to be more secure than using a public cloud platform. The proprietary data used in accounting and financial environments should be structured to prevent access by unauthorized users in a manner that there is an appropriate segregation of financial information. In fact, some countries have reservations about utilizing the services of corporations that use public cloud platforms. Since other clients utilize the same data center, it also puts external companies like suppliers, vendors, independent contractors and joint venture partners at risk.
Financial professionals must work closely with IT departments to reduce data security risks. To that end, they must also increase their awareness of how often information changes on a public cloud platform along with the probability of a breach in their data security taking place.
Where public cloud environments provide shared platforms, generalized data security controls, uncertain locations of stored data as well as unclear access management, a private cloud environment provides just the opposite. With a private cloud platform model, financial professionals are provided with
• A private secured platform
• A private secured infrastructure
• Industry-specific security controls
• A specific and clear data location
• A specific and clear access control
• A platform that’s conducive for highly sensitive data
Liability Risks Associated with a Breach in Data Security
One of the greatest risks associated with having a breach in data security (particularly data security related to corporations operating within the financial industry) is the exposure of other people’s sensitive information. Their information could be used in ways that could harm both the Corporation and the other victims. This could create major setbacks for all parties involved. Not only could corporations be sued by the victims, but more costs would be required to rebuild a new security system, process legal proceedings and all additional costs associated with recovering from such losses, including damages to brand recognition.
Some Logical Steps to Minimize Cyber Attacks
Financial professionals can work directly with the IT department to develop a data security plan. The plan should involve an internal, in-house cyber security system with checks and balances to better safeguard your critical and most sensitive information. Additionally, creating an internal cyber security team will also prove to be a means to better protect your data from many forms of cyber attacks.