January 27, 2022
As organizations remain on high alert of phishing and ransomware attacks, cybersecurity risks have become a top environmental, social and governance concern for Canadian investors.
When speaking to Benefits Canada, partner Molly Reynolds said that “some pension plan sponsors are exploring cyber insurance as a way to mitigate the risk of a breach, either by purchasing coverage for themselves or by insisting that investment targets have it in place ahead of a deal.”
She also warned that investors don’t need to be intentionally misled in order to find themselves exposed.
“The target might say they haven’t had any incidents, but when you dig in, you could find it’s because they don’t really have the framework in place to detect and monitor breaches, which means investors may be going into a purchase with an inflated level of confidence,” Molly added.
Read: Data management: turning risk into opportunity.
Additionally, looking across industries, Molly suggests that investment activity has been overlooked from a cybersecurity perspective.
“There is often highly sensitive information about the founders, directors and management of target companies and other material that, if leaked, could crater significant deals,” Molly said.
“It’s been a long-standing practice for funds to sign non-disclosure agreements around potential transactions and I’m seeing a lot more practice and planning steps being taken to ensure that they are operationally living up to those significant confidentiality obligations.”
You can read more about our Data Governance and Strategy work on our practice page.
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