New research commissioned by IT giant CGI and undertaken by Oxford Economics finds that FTSE 100 companies that experience a cyber-attack face taking an enormous hit to the market value of their shares. Oxford Economics studied 65 security breaches across FTSE 100 companies and found that cyber-attacks tend to lead to an average fall of 1.8% in the value of their shares compared to their peers. This translates into roughly £120m for a company.
The research by Oxford Economics also found that investors are becoming increasingly wary of listed companies that have fallen victim to a cyber-attack. Whilst news of a hack would have caused a firm to experience a 0.2% fall in the value of their shares in 2013, this had risen to 2.7% by 2016.
The research comes at a time when cyber-security is an important issue of concern for British companies. Research by the British Chambers of Commerce (BCC) found that one in five British companies had fallen victim to a cyber-attack in the past year, and that larger companies were more susceptible to being attacked than smaller companies. BCC director-general Adam Marshall said: “Cyber attacks risk companies' finances, confidence and reputation, with victims reporting not only monetary losses, but costs from disruption to their business and productivity.”
The research also comes at a time when new legislation from the EU called the General Data Protection Regulation is due to be implemented and will enforce an even tougher data protection regime; this will be implemented in the UK as well despite the UK leaving the EU.
You can read the research by Oxford Economics here.