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What is Digital Risk? Definition and Protection Tactics for 2021

What is Digital Risk? Definition and Protection Tactics for 2021

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Digital risk refers to all unexpected consequences that result from digital transformation and disrupt the achievement of business objectives.

When a business scales, its attack surface expands, increasing its exposure to outside threats. This makes digital risk an unavoidable by-product of digital transformation. Fortunately, digital risk protection strategies have been developed to mitigate digital risk so that organizations can continue confidently scaling their operations.

Types of digital risk

The provocative complexity of the digital risk landscape can be simplified by dividing risks into different categories. This will help organizations identify the most vulnerable areas of their ecosystems and support highly-targeted risk protection efforts

There are 9 primary categories of digital risk.

types of digital risk
Types of digital risk

Cloud technology

Risks affecting systems, processes, and people. This could arise from technological incompatibilities, errors, and failures.

Cybersecurity

Risks relating to unauthorized access to sensitive resources and data breaches. These could include both inherent risks and residual risks.

Data leaks

Data leaks are accidental exposures of private data that could develop into data breaches. As the digital landscape expands, the data lifecycle spins faster, creating more instances of data-in-use, data-in-transit, and data-in-rest.

Data security is difficult to maintain under such dynamic conditions, making data leakage unavoidable during digital transformation.

Compliance

Non-compliance risks refer to malpractices that breach regulatory compliance standards. Vendor non-compliance could also negatively affect digital risk protection efforts.

Process automation

Refers to compatibility issues that arise when automation processes are modified, or when new processes are introduced (may also impact technology risks).

Resilience

Risks that affect the availability of business services after a disruption, such as a server outage or data breaches.

Data privacy

Refers to any risk affecting the protection of sensitive data. Such as personally identifiable information, financial information, etc.

Third-party risk

All risks associated with third-party vendors, These could include ecosystem vulnerabilities, non-compliance third-party breaches, and intellectual property theft.

Workforce talent

Any talent gaps preventing the achievement of business objectives.

How to achieve digital risk protection

Cyberattacks have the greatest impact across all categories of digital risk. By focusing digital protection efforts on cybersecurity risks and data leak risks, all other categories of digital risk will be mitigated

Digital risk protection is an extension of conventional threat intelligence solutions. Both solutions should be deployed in parallel to create the most comprehensive threat detection engine.

Threat intelligence

Threat Intelligence solutions focus on threat prevention and planning. They continuously scan the ecosystem for vulnerabilities and manage remediation efforts for all discovered risks.

The end-goal is to strengthen security postures both internally and throughout the vendor network to improve resilience to cyberattack attempts.

Digital risk protection

Digital risk protection has a more proactive approach to cybersecurity by focusing on detecting threats before they develop into data breaches.

Digital risk protection efforts monitor for:

  • Data leaks
  • Brand compromise
  • Account takeovers (account impersonations)
  • Fraud campaigns
  • Reputational damage

In other words, digital risk protection efforts focus on preventing cyber attacks, and threat intelligence solutions focus on improving security postures to help organizations withstand cyber attack attempts.

To meet all of the above requirements, and keep up with an ever-expanding threat landscape, digital risk protection efforts should consist of:

  • Digital footprinting - To continuously monitor the security state of all exposed assets.
  • Remediation workflows - To rapidly mitigate detected threats.
  • Threat exposure mitigation - To strengthen ecosystem vulnerabilities.

Organizations with a complex digital landscape will achieve a higher ROI by partnering with a Digital Risk Protection Service (DRPS). For those that prefer to dedicate internal resources to this effort, an effective digital risk management plan should be established.

How to manage digital risk

Effective digital risk management is a cyclical effort between visibility, insights, and remediation, where each quadrant is powered by the data obtained from the preceding quadrant.

How to manage digital risk
How to manage digital risk

Visibility is achieved through digital footprinting to monitor exposed assets.

Visibility data is feed through threat intelligence solutions to power insights into the best remediation responses.

Digital landscape insights empower the design and deployment of highly-effective remediation responses.

The following steps outline a digital risk management framework with a specific focus on mitigating cybersecurity and data leak risks

Step 1. Identify all exposed assets

Identify all assets exposed to potential unauthorized access. This should include all social media channels and resources housing sensitive data. A digital footprint can be mapped with the assistance of an attack surface monitoring solution.

Step 2. Monitor for data leaks

A data leak detection solution can discover any data leaks linked to your organization to provide both visibility and vulnerability insights into this commonly overlooked attacked vector.

Cybercriminals are always on the hunt for data leaks to arm their data breach campaigns. By remediating data leaks before they're discovered by cybercriminals, cybersecurity, and therefore all other categories of digital risk, will be protected.

Step 3. Keep risk and threat models updated

With a digital footprint is established, all threat intelligence data can be collected to create a model of your threat landscape.

Your Incident Response Plan should be updated every time this threat model is refreshed.

Step 4. Secure access to all exposed resources

To protect against reputational damage, privileged accounts should be protected from compromise.

Rather than only focusing on established cyber defenses around sensitive resources, detection parameters should be broadened to detect and block all unauthorized network access.

Strategically placed honeytokens will alert organizations to any unauthorized access attempt. Further access to resources can be mitigated with a Zero Trust Architecture (ZTA), an assume breach mentality, and enhanced Privileged Access Management (PAM) security.

Step 5. Keep vendors compliant

The risk of non-compliance has both a financial and cybersecurity impact. Non-compliance is linked to poor security efforts, and regulatory fines could range from $14 million to $40 million.

To mitigate the risk of non-compliance, it's not enough to only monitor the internal ecosystems, the entire vendor network needs to be purged of security vulnerabilities.

Cybercriminals could breach your organization through vendors with poor security postures.

A third-party risk management solution will ensure all vendors remain compliant through regulatory-specific risk assessments.

Digital Risk Protection by UpGuard

UpGuard combines a threat intelligence platform with a data leak detection engine to create a digital risk protection solution focused on mitigating the most critical categories of digital risk - cybersecurity and data leaks.

UpGuard also supports compliance across a myriad of security frameworks, including the new requirements set by Biden's Cybersecurity Executive Order.

CLICK HERE for a FREE trial of UpGuard today!

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