More board involvement is necessary to guide cybersecurity strategies that protect the company.
Key takeaways
An "enterprise as a system" approach enables the board and management to contextualize cyber risk.
EAS builds an understanding of complex interconnections and their influence on enterprise risk.
Cybersecurity has rapidly evolved from being a concern within the information technology department to a fundamental function of successful business operations. With this transition, more board involvement is necessary to guide cybersecurity processes and strategies to protect the organization effectively. However, many boards lack key context to fully understand the impact of evolving cybersecurity risks, highlighting a main challenge to success and sustainability.
Implementing an ‘enterprise as a system’ plan
To gain a stronger perspective on cybersecurity risks, middle market organizations should focus on taking an enterprise as a system (EAS) approach. Today’s enterprises have a complex set of interacting internal and external digital and physical elements, and myriad people who operate them. However, traditional enterprise risk models look at only one domino without understanding the potential enterprise impact if another one falls.
However, an EAS approach enables an organization to build an in-depth understanding of the complex interconnections among systems and how each system and its connections influence enterprise risk. With a shared understanding of the EAS among the board and management, a company can properly contextualize cybersecurity risk and mitigate cyberthreats as technology systems rapidly change and emerging innovations like artificial intelligence transform the risk landscape.
The facets of an effective EAS strategy
An EAS requires boards to think differently about three key elements: organization, education and culture. The links below provide details on key actions that can position the board to deliver more effective cybersecurity governance.
Organization: Align governance structures to improve oversight
Organizations should assess and align their internal structures to foster stronger collaboration between boards and technical leaders. This involves creating governance models that clarify roles, streamline decision-making processes and ensure cybersecurity accountability is embedded across the enterprise—not isolated within IT. A well-aligned organization enables leadership to better understand systemic digital risks and to act on them strategically. By integrating cybersecurity into the core governance framework, companies can respond more swiftly to threats, improve resource allocation and build a more resilient operational foundation.
Education: Equip your board and executives with actionable insights
Cybersecurity reporting to the board and C-suite deals with areas such as compliance, penetration testing, heat maps and dashboards. While impressive and important, this information is often very complex and can lack context. Ultimately, these indicators without context for the business processes they enable have limited value for board governance. With EAS, boards and management can develop a shared understanding of systemic risk by aligning IT systems and processes to how they enable each organization’s core objectives.
Culture: Foster organization-wide cyber responsibility
Sustainable cybersecurity requires a culture that prioritizes awareness, accountability and proactive engagement with cyber risk at every level of the organization. This requires fostering open communication between technical and nontechnical teams, empowering leadership to ask informed questions and reinforcing shared ownership of digital risk across business functions. Ultimately, building a resilient organization starts with reshaping the culture to value transparency, continuous learning and cross-functional collaboration around cybersecurity.
The takeaway
Just as boards have developed fluency in financial oversight, they must now do the same with digital risk. As you get started on this journey consider the following:
- Boards should shift from quarterly cybersecurity briefings to real-time risk dashboards, ensuring continuous monitoring rather than fragmented, after-the-fact reporting.
- Boards should adopt cybersecurity risk appetite statements that align with business objectives—clearly defining acceptable risks, necessary investments and thresholds for escalating security incidents.
- Consider a board governance approach that aligns with a leading cybersecurity framework, such as the National Institute of Standards and Technology Cybersecurity Framework (NIST CSF) guideline of identify, protect, detect, respond and recover.
Investing the time and resources to assess your cybersecurity governance and management structure will result in a more resilient enterprise, optimized cyber spending, and more effective corporate policies and procedures to tackle cyber and AI risk. With more effective organization, education and necessary cultural changes, the board can build the perspective necessary to guide the business toward sustained success in an increasingly challenging cybersecurity environment.
RSM US MMBI
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