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Ponemon research: data breaches to cut 5% from share prices

Tuesday 5 September 2017 00:26 CET | News

Data security breaches negatively affect an entire organization, from sales and marketing to shareholders, according to a Ponemon research.

The study found a direct correlation between the organization’s security posture after a data breach and share value drop, customer churn and revenue loss. Ponemon found that the stock value index of 113 randomly selected global companies declined by an average of 5% on the day a data breach was disclosed and experienced a customer churn rate of as much as 7%.

Furthermore, companies with a low security posture that did not respond quickly to the data breach experienced a stock price decline that on average lasted more than 90 days. This report is of particular significance to Australia where mandatory data breach notification legislation will take effect from February 2018. As such, 33% of Australian consumers impacted by a data breach reported they had discontinued their relationship with the organisation that experienced the breach.

Moreover, 40% of Australian IT practitioners responding to this study reported their organisation had experienced a data breach involving the loss or theft of more than 1000 records containing sensitive or confidential customer or business information since 2015.

In Australia, the Ponemon study surveyed 215 individuals in IT operations and information security, 218 senior level marketing professionals and 316 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.


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Keywords: Ponemon, data breaches, cyber security, cyber attacks, stock price, study, Australia
Categories: Securing Transactions | Digital Identity, Security & Online Fraud
Countries: World
This article is part of category

Securing Transactions