Best Practices Q&A: Guidance about what directors need to hear from CISOs — from a board member

By Byron V. Acohido

CISOs can sometimes be their own worst enemy, especially when it comes to communicating with the board of directors.

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Vanessa Pegueros knows this all too well. She serves on the board of several technology companies and also happens to be steeped in cyber risk governance.

I recently attended an IoActive-sponsored event in Seattle at which Pegueros gave a presentation titled: “Merging Cybersecurity, the Board & Executive Team”

Pegueros shed light on the land mines that enshroud cybersecurity presentations made at the board level. She noted that most board members are non-technical, especially when it comes to the intricate nuances of cybersecurity, and that their decision-making is primarily driven by concerns about revenue and costs.

Thus, presenting a sky-is-falling scenario to justify a fatter security budget, “does not resonate at the board level,” she said in her talk. “Board members must be very optimistic; they have to believe in the vision for the company. And to some extent, they don’t always deal with the reality of what the situation really is.

“So when a CISO or anybody comes into a board room and says, ‘if we don’t do this, this is going to happen,’ it makes them all feel anxious and they start to close down their thought processes around it.”

This suggests that CISOs must take a strategic approach, Pegueros observed, which includes building relationships up the chain of command and mastering the art of framing messages to fit the audience.

Last Watchdog engaged Pegueros after her presentation to drill down on some of the notions she highlighted in her talk. Here’s that exchange, edited for clarity and length.

LW: Why do so many CISOs still not get it that FUD and doom-and-gloom don’t work?

Pegueros: I think this is the case where CISOs understand the true gravity and risk of the situation and they feel a sense of urgency to drive action by senior management and the board.  When that action does not materialize as they think it should, they start to use worst case scenarios to drive action.

Pegueros

In the end, the CISOs are just trying to do the right thing and resolve the issues threatening the organization. What they fail to realize is that the Board does not truly understand the risk of the situation and since nothing has happened up until that point, why would it happen now?

LW: What are fundamental steps CISOs can take to start to think and act strategically and communicate more effectively

Pegueros:  First, they need to understand the business including financials, customer concerns, product deficiencies and any macro level issues and how they are impacting the business.  Next, they need to understand the priorities of the business and frame all the security priorities in the context of the business priorities.

If the CISO wants to drive better compliance, then they talk about how compliance is key to enabling sales and how the customers are demanding compliance to do business with the company.  If they want better patching, then the CISOs should talk about how patched systems will improve availability of the product and therefore service to the customers.

If they want improved visibility around security logs, they can talk about the benefits of better visibility to the overall troubleshooting and improved efficiencies in operations.   Boards won’t argue with more revenue, better availability (which drives revenue) or greater efficiencies (which save money)

LW: Is compliance an ace in-the-hole, in a sense, for CISOs? How does the SEC’s stricter rules come into play, for instance.

Pegueros:Compliance is not going to fix all the security risks.  Many companies who are compliant with various regulations or frameworks have had breaches.  I believe compliance sets a minimum bar and a CISO must leverage compliance initiatives to drive overall better security, but it is not sufficient in and of itself.

Compliance brings visibility to a topic.  For example, with the SEC Cybersecurity Rules, Boards are now much more aware of the importance of cyber and are having more robust conversations relative to cybersecurity.

LW: Is it overly optimistic to suggest that companies will soon start viewing security as a business enabler instead of a cost center?

Pegueros: Sound cybersecurity practices and risk management are a differentiator for many non-regulated companies and are table stakes for highly regulated organizations.   Enterprise customers are demanding and driving the conversation around cybersecurity.

They are demanding to understand how their vendors could potentially impact their customers and their reputation.  The evolving and interrelated ecosystem that most companies exist in has the entrance fee of sound cybersecurity practices.  In time, organizations who do not pay this entrance fee will be kicked out.

LW: Massively interconnected, highly interoperable digital systems of the near future hold great promise. Don’t we have to solve security to get there?

Pegueros: Understanding digital connectedness, the benefits, and risks of that relationship and how it enables strategic objectives is key for the board to understand.  Security is just one risk element of this reality.

Boards need to dig in and understand all the key connection points and how they could enable or potentially hinder growth for the organization.  We have a long way to go relative to boards because technology is disrupting the established norms and modes of operations relative to governance.  Boards must evolve or their organizations will fail.

Acohido

Pulitzer Prize-winning business journalist Byron V. Acohido is dedicated to fostering public awareness about how to make the Internet as private and secure as it ought to be.


 

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