Managing risk effectively is one of the best ways to unlock business growth.
Risks range from financial and macro events to geopolitical and supply chain disruptions, and chief financial officers are tasked with stepping up to keep their organizations secure.
Traditionally focused on financial risks, CFOs are now finding themselves not only managing funds but also protecting the company’s assets from fraud and other threats. Ecosystem dangers like cyber threats, data breaches and more pose risks to organizations’ financial stability and reputation.
The shift toward digital transformation has exposed companies to new vulnerabilities, making cybersecurity a strategic imperative — and making CFO buy-in crucial for standing up an effective defense that enables sustainable business growth.
In today’s operating environment, leadership in cybersecurity is no longer confined to the IT department but requires a collaborative effort across the organization.
Read also: 4 Ways CFOs Are Steering Around Challenges and Ahead of Competitors
As stewards of financial integrity and custodians of sensitive data, CFOs must navigate a landscape of cyber threats, regulatory requirements and third-party risks.
By proactively addressing these challenges, CFOs can not only protect their organizations from financial loss and reputational damage but also position themselves as key leaders in the ongoing battle for cybersecurity resilience.
“CFOs are always playing offense, but you’re also playing defense,” DailyPay CFO Ken Brause told PYMNTS in May. “And that plays into risk management.”
Embracing a collaborative approach can involve CFOs working closely with chief information officers and chief information security officers to ensure that cybersecurity measures are not only in place but are also aligned with the overall business strategy. This alignment is important for managing and mitigating risks effectively.
The PYMNTS Intelligence report “Middle-Market CFOs Tag Competitive Positioning Among Top Drivers of Uncertainty” examined the priorities and concerns that are top-of-mind for CFOs, particularly those in the middle market.
It found that with the specter of uncertainty looming large, finance chiefs are focused on maintaining and enhancing their companies’ competitive positioning — something that an effective risk posture is key to supporting.
See also: How CFOs Are Managing the Year of Regulatory Anxiety
CFOs are custodians of a company’s financial data, and in today’s interconnected world, that data is more valuable than ever. From sensitive information on cash flows and investment portfolios to payroll and vendor payment details, financial data is an attractive target for cybercriminals seeking to monetize stolen information or exploit it for ransom.
The rise of digital payments, eCommerce and cloud-based financial systems has increased the volume of financial data transmitted online, making it vulnerable to cyberattacks.
For CFOs, ensuring the security of financial transactions and data is paramount, as breaches can result in financial losses and regulatory penalties. Cybercriminals often exploit weak points in financial systems to carry out fraud, and the onus is on the finance department to implement robust security measures to protect this data.
Beyond external threats, insider risks remain a concern. Disgruntled employees or contractors with access to financial systems can leak sensitive data or compromise internal controls.
Read also: Reducing the Attack Surface: How Data Breaches Imperil Corporate Networks
As businesses rely on third-party vendors, suppliers and service providers for cloud storage, software and payment processing, third-party risk management has become a concern for CFOs. A breach at a third-party vendor can expose a company’s financial data or disrupt business operations, making it imperative for CFOs to evaluate the security posture of their external partners.
High-profile cyberattacks, such as ransomware, phishing and business email compromise (BEC), are also targeting organizations of all sizes, with finance functions often being at the heart of these attacks.
Invoice fraud is a growing threat, with cybercriminals and internal fraudsters finding ways to manipulate the payment process for illicit gain.
Ultimately, as the financial stewards of their organizations, CFOs are positioned to advocate for cybersecurity investments. In many companies, cybersecurity budgets are scrutinized alongside other operational expenditures, and CFOs must weigh the costs of cybersecurity solutions against their potential benefits.
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