FTSE 100 companies that suffer serious cyber attacks risk a £120m drop in market value, according to security experts at Oxford Economics.
The study, which looked at 65 severe breaches at listed companies found there was a correlation between cyber attacks and a decrease in the value of share prices. On average, these data breaches led to a 1.8% fall in market value, which for FTSE 100 companies is the equivalent of £120m.
According to Oxford Economics, this figure has doubled in the past 18 months, making board members sit up and take stock of their cyber security situation.
According to figures from the cyber value connection report, published by CGI, investors have seen £42bn wiped from the value of assets since 2013 due to severe public domain cyber security incidents. However, the report notes that this figure includes only 65 publicly known severe breaches, which means the true amount of company value lost due to cyber attacks is likely to be far higher.
One direct example of the effects data breaches have on company value is Yahoo, which was forced to discount the sale price of its core business to Verizon by over £270m after revelations of data breaches in 2013 and 2014 affecting one billion and 500 million accounts.
As the GDPR deadline approaches, the number of cyber attacks made public is only likely to increase, meaning this figure could rise still higher, affecting shareholders around the world.