How to run a cyber risk assessment for your business

Kevin Hamano
October 28, 2020

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Before we discuss in detail what cyber risk assessment is all about, let us first go down into the basics of risk assessment and what it means for your business.

Risk = Asset x Threat x Vulnerability

Risk assessment

Risk assessments protect businesses against potential hazards, losses, and their damaging effects. It prevents or mitigates the negative impact in the unfortunate event this happens. 

In a nutshell, risk assessments help you:

  1. Identify hazards
  2. Identify assets that could be at risk
  3. Analyze its impact on the business
  4. Document your findings
  5. Review the risk assessment and update if necessary

Type of business risks

It is critical that you know the different types of risks to assess which ones apply to your business. Getting the help of a professional can help you identify and organize your risk assessment.

Setting up a business comes with its inherent risks. But risk levels also depend on the type of business. Below are the major types of risks faced by companies today.

  1. Economic risks
  2. Security risks
  3. Financial risks
  4. Competition risks
  5. Operational risks
  6. Reputation risks
  7. Compliance risks

What is a cyber risk assessment?

Cyber risk assessments as defined by the National Institute of Standards and Technology (NIST) as ‘risks assessments are used to identify, estimate, and prioritize risk to organizational operations, organizational assets, individuals, other organizations, and the Nation, resulting from the operation and use of information systems.’

A cyber risk assessment identifies a threat, protect assets, and mitigate losses in case of a cyber-attack. This process helps you determine your risk level and susceptibility to a cybersecurity attack.

Why is a cybersecurity risk analysis important? 

It is a common misconception that cyber-attacks only target IT-related businesses. But hackers don’t distinguish as long as they can gain something from it.

  1. Prevent, reduce potential loss due to a cyber-attack – risk assessments reduce or prevent financial losses and stoppage operations. Conducting a cyber risk assessment for your business helps identify your vulnerability and create a plan of action to mitigate any potential damage to your business.
  2. Gives you a more accurate overview of your current risk status – you may have a done a previous risk assessment for your business, but a cyber-risk assessment enables you to handle this specific type of attack
  3. Create a template for future risk assessments – cyber risk assessments are a continuing process. Businesses are encouraged to perform a risk assessment to assess their vulnerability to current threats. 
  4. Ensure 100 percent availability of online resources – Denial of Service, ransomware, and other similar cyber-attacks prevents or even stops the free flow of information from your servers to customers and employees who need access to this data.
  5. Prevents data loss/breaches – a company’s assets are not only limited to its physical assets. It also includes intellectual properties, trade secrets, and other sensitive information.
  6. Ensures compliance – businesses who fail to protect or take measures to safeguard customer data is subject to violation of specific regulations 

Common types of cyber attacks

Cyber-attacks exploit a weakness in both software and the people who use this software. A sophisticated cyber-attack may use malicious software to gain access to valuable information (passwords, company information) or trick people into divulging information by appealing to their emotions (threats, rewards).

1. Denial-of-Service (DoS) 

A DoS attack disables your network, applications, servers by overwhelming your system’s resources. A Denial of Service is not aimed at hackers gaining access to your network but prevent you from using your systems normally or stop it altogether. An example of this would be an attack on a bank’s server, which prevents clients from transacting or accessing their accounts. 

2. Man in the middle, monster in the middle, machine in the middle attack (MitM)

A MitM cyber-attack is when a third party inserts himself into a conversation between two parties. It is done to gain access to information by eavesdropping or impersonating either party to start a conversation. 

3. Password attacks 

It can be as simple as guessing the user’s password based on their personal information (birthdate, essential events, location, family members) or the use of keyloggers to record passwords as they are entering them. Research shows that more than 60 percent of people use the same password across multiple sites, which shows people are either confident about their level of protection or just plain lazy.

Types of password attacks

a. Brute Force attacks – most of us make the mistake of using simple letter and number combinations to make it easy for us to remember passwords. It is why some sites or applications require us to include special characters, and even a minimum character count as a way of safeguarding passwords. Brute force attacks use software that uses common password combinations.

b. Keylogger – this is a program that records user keystrokes, including your log-in and password information. It still takes a lot of work before a hacker gets access to your account information. What usually happens is a hacker sifts through the recorded data and identifies possible account name and password combinations.

c. Dictionary attack – this type of attack only succeeds because people are too lazy to create secure passwords. A software automatically uses words from the dictionary or a preconfigured list of commonly used passwords. 

4. Phishing attacks

Phishing is a type of cyber-attack that commonly uses emails from seemingly trusted sources to send malware, trojans, viruses, or links to a website. It is done to trick people into divulging their personal information (passwords, bank accounts, company information).

5. Drive-by-attack

It is a popular strategy for hackers who plan to spread malware. They target unsecured websites and plant malicious codes on one of their pages. This attack is usually done against random websites taking advantage of vulnerabilities.

The affected site acts as a host, spreading malware to visitors without the site owner knowing it. The malware can also direct visitors to another site controlled by the hackers. This type of attack usually goes unnoticed since there are no alerts or call to action. 

6. Malware attacks

It refers to a vast suite of malicious software that unknowingly installs itself on your system. It can hijack legitimate applications and replicate itself across the network. Below are some of the common types of malware:

a. Virus – these are designed to damage or destroy data, reformat your hard disk or completely bring your system down. It can also be used to steal data, steal accounts, flood your computer with advertisements, and more.

b. Trojan horse – is a type of malware that disguises itself as a regular program to trick users into downloading or installing the software. 

c. Worm – these burrow into unsuspecting systems by taking advantage of operating system vulnerabilities. Worms don’t require any human intervention. It merely replicates itself until it ultimately infects or destroys the system.

d. Adware – is a software or program that places unwanted advertising on your computer. It can include unwanted pop-ups and redirects to an advertising site.

e. Ransomware – this is a type of malware that holds you’ data in hostage.’ It locks you out of your system, forcing you to pay a hacker to regain access to your computer.

Simple steps on how to run a cyber risk assessment manually

1. Identify all valuable assets – this refers to all assets that are potential targets of a cyber attack

  • Websites
  • Servers
  • Customer/ client information
  • Company secrets
  • Internal documents/ communique

2. Identify possible threats and consequences 

  • Unauthorized access to data – this could be the result of a direct attack (hacking), malware, or an employee downloading valuable company data for personal gain.
  • Failure to follow proper security protocols or mishandling of data – authorizing the use of USB or other storage devices without restrictions. Improper disposal of data storage devices and transmitting information over unsecured networks.
  • Loss of data – failure to accurately replicate or preserve data
  • Misuse of data by an authorized user – using information for other purposes other than what it was designed for
  • Loss or disruption of service – this can be caused by a Denial-of-Service (D-o-S) attack.

3. Identify vulnerabilities and exposure to risk – these are possible entry points/vectors for cyber-attacks. Make an initial assessment of your current security status and protocols. Possible vulnerabilities include outdated security software, equipment, and the human factor.

4. Identify threats and their level – this step categorizes risks/ threats and their impact on your business

  1. High – significant monetary losses, stoppage or closure of business. It could come from a highly motivated hacker who is technically capable of conducting an attack. Based on your current security capability, the likelihood of preventing or stopping this attack may be impossible.
  2. Medium – can cause disruption, interfere with the typical day to day operations of your business. The threat is credible and sufficiently capable of launching an attack, but enough security controls are in place that could mitigate losses.
  3. Low – insignificant, minimal effect. The source of the threat lacks motivation or is caused by a random attack. Your business is fully capable of identifying and minimizing or stopping the negative effects of such an attack.

5. Analyze, develop, and create the control environment – there are different strategies for mitigating potential cyber-attack’s negative effects. A robust security protocol gives you the best chance of keeping your business secure.

Examples of effective security control include:

  1. Developing a password policy for all employees
  2. Installing malware, anti-phishing, and anti-virus software
  3. Creating user-level controls
  4. Encrypting data
  5. Setting up a firewall
  6. Creating multiple networks

6. Evaluate your cybersecurity controls – the mark of good risk analysis is the ability to accurately assess your current security status, implement a security protocol, evaluate the effectiveness, and implement changes.

It is also important to remember that risk assessments should be done regularly. For example, the problem with malware or anti-virus software is that these are only programmed after a threat is identified. So, these are reactive and not proactive. Hackers can also be very creative and do not use the same strategy twice.

Based on the evaluation, your cyber-risk control protocols can be: 

  • Effective – protocols are able to meet all objectives and security requirements.
  • Satisfactory with recommendations – security protocols are adequate and compliant with generally accepted standards, policies with recommendations for improving or enhancing current policies and protocols.
  • Needs improvement – barely meets control objectives or compliance with accepted standards—a strong recommendation to update existing policies and protocols.
  • Ineffective – does not meet desired, minimal goal. Total revamp, a strong recommendation to perform a complete cyber-risk assessment

7. Create a response or mitigation protocol – even with the best preparation or security protocols, the best way to protect your business against risks is to create a detailed response to each threat. It should also include early detection to prevent further loss or damage.

  1. Detection
  2. Determine the type of threat
  3. Assess vulnerability
  4. Identify affected assets
  5. Evaluate potential loss to business
  6. Implement mitigation protocols

Cyber risk assessment and your business

Conducting a cyber risk assessment is critical to any business. As the famous adage goes, ‘An ounce of prevention is worth a pound of cure.’ Failing to plan for this unfortunate event or execute a cyber risk assessment only opens the door to cyber-attacks. It can lead to irreparable damage and even lead to your business closing down.

We can’t stress the importance of keeping your business securely online, and one of the most vulnerable vectors when it comes to cyber-attacks is your exposure to unsecured networks. At Metafuro, we offer you a secure and simple project communication tool for your business needs. We give you a safe environment where you can transact your business and communicate securely.

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