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What’s new for 2023: predicting the impact of a changing world on cyber risk

iStock 1413637673 - Global Banking | Finance

By Thomas Stoesser, cybersecurity expert who is responsible for product management and marketing at comforte AG

A year can feel like a long time in cybersecurity. The world in many ways is very different to the one that began 2022 with optimism that the worst of the pandemic was over and things were returning to business as usual. The war in Ukraine, surging inflation and soaring energy prices have altered that calculation somewhat, while potentially impacting how much and where IT security leaders spend.

As digital investments continue to grow the attack surface in 2023, and regulatory and breach risks surge ever higher, the focus will need to be on simplifying security with a back-to-basics approach. In many cases, that means complementing consolidated controls with a data-centric security offering.

More of the same

The truth about the cyber risk and threat landscape is that it doesn’t simply change with the calendar year. In reality, many of the trends we’re likely to see in 2023 will be a continuation of those we’re already pretty familiar with. As the economic picture worsens, more emphasis will fall on IT leaders to support efficient growth, cost savings and productivity. That means outsourcing more of the infrastructure heavy lifting to cloud computing providers. This will help to keep remote workers online and power better customer experiences. But the expanded attack surface will be a challenge. One recent study found that over two-fifths of organizations felt their attack surface is “spiralling out of control.” Expect this figure to grow in 2023.

The rush to trim costs and drive efficiencies may also imperil security budgets themselves, especially among SMBs. That would be a mistake, given the potential financial and reputational costs that could stem from a serious breach. Fortunately, IT spending is forecast to continue rising, with security accounting for the biggest share of software. Whether there are enough skilled infosecurity practitioners in-house to manage these products is another matter. Outsourcing elements of the function like SecOps to specialist third-party providers is likely to become increasingly common as skills shortages worsen and staffing budgets feel the pinch.

Ransomware leads the field

What of the threat landscape next year? It’s difficult to think of anything other than ransomware continuing to be the number one risk to businesses in 2023. The Putin regime will continue to harbor some of the world’s most prolific ransomware actors, and as long as their tactics, techniques and procedures (TTPs) continue to bear fruit, little is likely to change. Growth in the volume of attacks might not hit the 93% year-on-year rise we saw in 2021, but for network defenders the relative success of ransomware-as-a-service will mean more attempts to steal, encrypt and hold to ransom their most business-critical data. We may even see the emergence of more groups like the infamous Lapsus$ collective. These will not even bother to deliver a ransomware payload, and instead simply seek to extort their victims with the threat of releasing sensitive internal and customer data.

Businesses will not only face a surging threat from Russian hacktivists, but also state-sponsored actors in 2023. Geopolitical tensions show no signs of abating thanks to war in Ukraine, Chinese nationalism, perennial North Korean provocation and an unstable Iran. Increasingly, cyber-attacks are being used by nations to project hard power, achieve geopolitical goals that diplomacy cannot, and even generate funds for isolated regimes. Whereas once the targets for such attacks were limited to governments, military and defense firms, today they could encompass a large range of critical infrastructure providers and even supply chain partners.

That leads on neatly to one of the other key themes of 2023: supply chain threats. It could be digital suppliers like software firms that are compromised to insert malware into updates, as per the SolarWinds attack. It could be managed service providers that are compromised to infect downstream customers. Or it could be a single partner like a law firm targeted for the data it holds on its clients. Whatever the cause, organizations will need to move from point-in-time, questionnaire-based partner assessments once or twice a year, to continuous risk management.

The cost of compliance

Business leaders should be treating these trends and threats with a certain degree of urgency. Why? Because of the increasingly complex and expansive regulatory landscape. Gartner predicts that by the end of 2024, three-quarters (75%) of the world’s population will have its personal data covered by privacy regulations. Although following the lead of the EU’s GDPR, many new laws have even harsher penalties such as jail time for executives.

It’s critical that organizations keep a close eye on developments and seek out technology that can help to reduce the scope and cost of compliance of such regulations, by keeping data secure but still usable. Gartner predicts that privacy-enhancing computation technologies like data masking and encryption will be used by 60% of organizations in this way by 2025, in use cases like cloud computing and analytics. Crucially they can also help to mitigate the risk of accidental leakage, such as via misconfiguration of cloud systems. And they could help to minimize legal risk as more legal action is taken next year in light of the “Schrems 2” judgement on EU-US data flows.

A changing market

What does all of this mean for IT security buyers? With the average enterprise running 76 discrete security tools, consolidation is the likely direction of travel over the coming few years. That means eliminating data silos and migrating to platform-based offerings – to reduce licensing costs and coverage gaps as well as make things easier for an IT security function increasingly stretched by talent shortages.

The idea of a “cybersecurity mesh” architecture very much follows these lines. By 2024, organizations adopting such an approach will reduce the financial impact of security incidents by an average of 90%, according to Gartner. It offers a promising way to manage what is an increasingly distributed and exposed IT environment. This is also where data-centric security technologies like encryption and tokenization will play an important role. Compatibility and ease of integration will be key selling points as CISOs head for simplicity and control in 2023.

657 - Global Banking | FinanceAuthor Bio:

Thomas Stoesser is a cybersecurity expert who is responsible for product management and marketing at comforte AG, where he is dedicated to developing and launching data security solutions that meet ever-increasing risk and compliance requirements.

He has spent 20+ years in software technology organizations helping shape and create solutions for enterprise and government customers. Thomas has held senior-level positions in sales engineering, product management, and product marketing in companies like Crystal Decisions, Business Objects, and Software AG.

Global Banking & Finance Review


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