According to a new research by FM Global, about two-thirds (66%) of the country’s financial executives have experienced equipment failure in the past five years. About 60% or 6 financial executives in 10 of these equipment failures is due to either cyber-attacks or data breaches. Only about 52% of them have had their activities hampered by natural disasters. Although the statistics paint a groom situation, 54% of the financial executives acknowledge that their firms have not created or adopted financial recovery strategies.
Finance’s role in operational risk management: A research by CFO on creating a resilient business found out that there is a low level of preparedness among financial executives to deal with operational risk events. Only a third or 34% of the financial executives acknowledged that their firms were in a good position to deal with equipment failure. Moreover, only a mere quarter (24%) reported to be well prepared to emerge from a cyber-attack or data breach.
According to Eric Jones, the vice president of operations and global manager of business risk consulting at FM Global, it is surprising that even after several companies became victims of operational risk events, only a low number of firms reported to be well equipped to deal with such a disruption.
He argues that the findings highlight an opportunity exists for financial executives to develop and adopt strong plans to protect their data and enhance their resilience when in such an unfortunate event. This comes in handy for businesses because about 70% (two thirds) of financial executives fear that their earnings or revenues will be at operational risks in the next two years.