The sustainable investment arm of ISS STOXX has launched a new cyber risk solution for investors which aims to help them identify and manage cyber risk across their investment portfolios.

The firm says that new SEC rules on cyber security risk management and incident disclosure have created an opportunity for investors to gain access to more consistent data on this topic. However, it adds that there is scope to complement company-disclosed data with forward-looking assessments to better gauge a portfolio’s cyber risk exposure.

Lorraine Kelly, ISS STOXX’s global head of investment stewardship solutions, said: “Recent data indicates that publicly traded companies suffer an average decline of 7.5% in their stock values after a data breach, coupled with a mean market cap loss of US$5.4bn. Our new cyber risk solution enables investors to identify and help manage cyber risk across their investment portfolios, and to proactively engage with companies to understand cyber breach risks.”

The new cyber risk solution aims to enable investors to understand the relative likelihood that a company will suffer a material cybersecurity incident within the next 12 months and to compare portfolio companies on the basis of an empirical, technical assessment of cyber incident risk.

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