Recent cyber-attacks have targeted the HSE as well as a major US gas pipeline and meat processing giant JBS. We will have to get used to this, says investment analyst Joachim Klement.
In his recent book Geo-Economics (free to download), Klement predicts cybersecurity will be one of the major geopolitical themes of the 2020s.
Markets are already paying attention. Almost 80 per cent of S&P 500 companies mentioned cybersecurity risks in 2018. Severe security breaches can depress an affected company’s share price for months, while lost client trust means it can take two years for firm revenues to return to pre-attack levels. In contrast, revenues of companies that did not suffer a security breach increased by almost 20 per cent over the same period.
Research also indicates almost all major industries face revenue losses from cybercrime in excess of $100bn over five years. High-tech companies are especially at risk, facing lost revenues of $753bn.
The worst-case scenario is an attack that catalyses a financial crisis or recession – an underestimated risk, says Klement.
He quotes former American government official Richard Clarke. "If you spend more on coffee than on IT security, you will be hacked," Clarke once said. "What's more, you deserve to be hacked."
