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Centrify-Commissioned Ponemon Study Finds Stock Prices Fall an Average of 5 percent, Customer Churn Can Increase as Much as 7 percent and Brand Reputation is Tarnished After a Data Breach is DisclosedCentrify, the leader in securing hybrid enterprises through the power of identity services, commissioned a new Ponemon research study that revealed data security breaches can negatively impact an entire organization -- including sales, marketing and IT -- and have a significant negative impact on company finances and shareholder value. Specifically, the study found that the stock value index of 113 companies declined an average of five percent the day the breach was disclosed and experienced up to a seven percent customer churn. What's more, thirty-one percent of consumers impacted by a breach stated they discontinued their relationship with an organization that experienced a data breach. And while the study found a data breach has a significant impact on brand reputation, a surprising 66 percent of IT practitioners don't believe their company's brand is their responsibility. "Data breaches are very real business and bottom line concerns. This reality was recently seen when a popular fast food chain's stock rose as much as 6.8% after reporting better than expected Q1 earnings, but then saw its gains chopped in half when it revealed it had a breach. The fallout can be significant and may even be a reason to relieve the C-Suite of its duties," said Tom Kemp, CEO of Centrify. "This new report serves as a wake-up call to every organization that security isn't just about protecting data, it's about protecting the business. It is no longer just an IT problem -- it must be elevated to the C-suite and boardroom because it requires a holistic and strategic approach to protecting the whole organization." The Impact of a Data Breach on Reputation and Share Value study is unique because it presents the views of three diverse groups who have in common the ability to influence share value and reputation. Ponemon Institute surveyed 448 individuals in IT operations and information security, 334 senior level marketers and corporate communication professionals and 549 consumers. Miscalculation of Security Risk on Shareholder Value The Ponemon study found a direct correlation between a data breach and stock decline, customer churn and revenue loss and the organization's security posture. The following findings are based on a sample of 113 companies that experienced a material data breach
The study showed a data breach has a significant impact on brand reputation, but the internal disconnects illustrate vulnerabilities across the organization.
Alarming Reality for Consumers There is a disconcerting gap between consumer expectations and corporate perspective when it comes to the protection of customers' personal information.
The Study The Ponemon study surveyed 448 individuals in IT operations and information security, 334 senior level marketing professionals and 549 consumers. To determine the impact a data breach has on stock value, 113 benchmarked global public companies that experienced a data breach involving consumer data were selected for this analysis. These companies, which represented 16 industry sectors, were indexed against a match sample of companies that did not experience a data breach during the test period. The Security Effectiveness Score (SES (News - Alert)) referenced in this study is determined by utilizing the Ponemon Institute's proprietary benchmark database and is derived from rating numerous security features or practices, including but not limited to, having a full-time CISO, employee training and awareness programs, regular audits and assessments of security vulnerabilities, and policies to manage third-party risk. This method has been validated from more than 50 independent studies conducted for more than a decade. Download the full report here. About Centrify
Centrify redefines security from a legacy static perimeter-based
approach to protecting millions of scattered connections in a
boundaryless hybrid enterprise. As the only industry recognized leader
in both Privileged Identity Management and Identity-as-a-Service,
Centrify provides a single platform to secure each user's access to apps
and infrastructure through the power of identity services. This is Next
Dimension Security in the Age of Access. Centrify is enabling over 5,000
customers, including over half the Fortune 50, to defend their
organizations. To learn more visit www.centrify.com. Centrify is a registered trademark and Centrify Server Suite, Centrify Privilege Service and Centrify Identity Service are trademarks of Centrify Corporation in the United States and other countries. All other trademarks are the property of their respective owners. View source version on businesswire.com: http://www.businesswire.com/news/home/20170515005286/en/ |