US CEOs Are More Worried About Cybersecurity Than a Possible Recession (fortune.com)

With markets uncertain, many onlookers might think a recession is on the way, whether that's most CFOs in the world or voters in the United States. But domestic CEOs don't find heavy economic headwinds their biggest external business worry, according to a new survey by the Conference Board. Instead, it's cybersecurity followed by new competitors. Risk of a recession is third. From a report: After high-profile data breaches experienced over the last two years by such companies as Marriott, Equifax, and Uber, that might seem understandable. But U.S. CEOs stand in stark contrast to those of the rest of the world. Cybersecurity was the sixth most pressing issue for chief executives in Europe. It was seventh in Latin America, eighth in Japan, and 10th in China. Regarding concerns over a potential recession, Europe put that in second place, while Japan, China, and Latin America all rated it number one.

Comments

Pepperidge Farms Remembers

[Ol Olsoc]

When CEO's weren't worried about a recession leading up to the 2007 Great recession.

Might want to be worried about both, my bois.

Re:Pepperidge Farms Remembers

[sycodon]

In 2007, the crash was the result of repackaged bad mortgage debt traded like it was good debt.

The only thing close to that now is student debt. However, I would hope that the Universities would be held accountable for that since the cost inflation and the lack of suitable employment skills falls directly in their laps.

Re:Pepperidge Farms Remembers

[ShanghaiBill]

Their arses are covered for a recession by golden handshakes/parachutes... A cyber security breach may lead them to being dismissed without their full payment.

This makes sense. If a company loses money in a recession, it is not the CEO's fault. One person didn't cause the recession, and the best a company can do is have enough financial cushion to ride it out. But a breach is preventable, and the buck stops with the CEO, so they should be held accountable.

Re:Pepperidge Farms Remembers

[alvinrod]

There were plenty of other times the CEO's weren't worried about recessions leading up to periods where there weren't any recessions. There's always someone predicting some misfortune or windfall. If any one of these people were actually that good and always right, they'd own the rest of the planet already since they could make better financial plays than everyone else just like a poker player who can see all of the cards.

Also, the phrase "more worried than" doesn't imply that recessions aren't a worry, merely that there's something else that's being recognized as a bigger threat. Given the number and severity of data breaches, I would say that they have reason to be worried. Even more so given the mountains of data that companies are collecting these days.

Re: Pepperidge Farms Remembers

[ranton]

If I were a CEO I sure wouldn't worry about cybersecurity because the general public doesn't seem to care. Large, outrageous breaches have become the norm. I'm not even remotely surprised anymore.

Whether or not you care isn't their primary concern. It is the affect on stock price as compared to economic indexes. Research I have seen does show these breaches are having significant negative affects on stock price. It isn't as obvious while overall stock prices are rising, but when you compare them to similar companies their stock price is not keeping up with the market.

Stock prices certainly fall in recessions too, but so does the stock price of their competitors. If things get too dire they always have their golden parachutes to save them.

Re:Pepperidge Farms Remembers

[ranton]

In 2007, the crash was the result of repackaged bad mortgage debt traded like it was good debt.

There are many more scenarios than just a debt crisis which could cause our next recession. Inflation hasn't been a problem even with significant stimulus, but the causes of inflation tend to lag and can be hard to fight so runaway inflation is still a legitimate concern. Corporate debt is over 50% higher as a percentage of GDP today than it was in 2007, caused by incredibly cheap interest rates, which can certainly cause small dips in the economy to have much larger ripple effects. Higher inflation which is generally combated with higher interest rates would exacerbate this problem. And then there are always trade wars, which we are already seeing on a very small scale without many responsible parties in power to combat if it gets out of control.

I'm not saying I think another great recession is likely, but there are certainly many potential causes of one on the horizon.

Re:Pepperidge Farms Remembers

[jellomizer]

For your statement #1, there aren't many good options for you to advance your career without a college degree. America needs to enhance its vocational training to many white collar jobs and the jobs that may need specialized skills but not the particular rigors of a college degree.

For statement #2 Schools already try to hard to make sure patients pass college. (Basically due to lack of career options without a degree). And undergrad degree should actually really mean something, because a lot of students should be washed out of college, or be sure if you go to college you are ready for the rigors. Now colleges should do more then the 100 students in a lecture hall, with a professor who doesn't speak the language common with students, ranting for 2 hours. Only to have students then just read the book and hope they read the material that will allow them to pass the test. But in college there is too much of a curve grading, and simplifying of information so students can pass.

Re: Pepperidge Farms Remembers

[Tom]

Thanks for that link. I see that's fairly new data. Until recently, older research had demonstrated that the dreaded "reputation" impact is actually negliegable and can typically countered with a moderate expense of PR.

It's good to see newer data to the opposite.

Well of course

[fat man's underwear]

Even in a recession they still get their golden parachute, but a IT breach could reveal their porn browsing habits

Obviously

[ranton]

In a recession at least all of their competitors are feeling the pinch too. Sustaining competitive advantage is far more important than the temporary pain of a recession. A data breach and new competitors are much bigger concerns for any CEO with his/her head on straight.

CEOs don't care about either one...

[Anonymous Coward]

In my experience working with C levels, they don't give a crap about either one.

Scenario 1: A massive cyberattack. All their source code, info on people, user accounts with decoded passwords, credit cards, payroll, etc., now are residing in a Lower Elbonian database public to the world. The C-levels short their stock, make the announcement that everything is hosed, laugh all the way to the bank, and toast the downed company on their new yachts. Insider trading? Not prosecuted these days.

Scenario 2: A massive recession. Simple. Bailout from the tax payers if a financial institution, pay themselves some nice golden parachute bonuses, and then go visit the shipwright for the new yacht.

Either way, if the US and Europe descend into anarchy, they just move to another safe place. There are always South American and African countries who will take them.

Of course not

[jeffasselin]

A recession will barely affect those at the top.

Cybersecurity risks hitting their assets, bank accounts, and tax haven shenanigans.

They are not worried

[WindBourne]

They keep offshoring to India. Who is India's closest ally? Russia. It is one thing to bring known ppl to America, it is another to send work offshore where a gov that views us as enemies can access the software.

Not in the UK they aren't

[kkoo]

From my own personal experience working at very large, IT dependent organisations, CEOs pay nothing but lip service to IT security. Shut-up then cover-up is the order of the day. Small companies, where CEOs can't hide behind layers of management and bureaucracy, and where they have to be good at their job and actually direct the company for its success, is where they really do care.

Color me skeptical

[OneHundredAndTen]

In my experience, most people claim that security is a big problem. But, when the rubber meets the road, they are reluctant to invest. Why? Because the aftermath of situations caused by security breaches tends to be a lot of noise - and very little else. We keep hearing about huge security breaches in Equifax, Target, Visa, etc. I am sure that, after such breaches, heads roll in the companies affected. But such companies just keep going. A breach like the one at Equifax a few years ago should have brought the company to its knees. But, Equifax is still there, doing what it has always done. I am sure they took a beating, but it would seem that it makes financial sense for them to take that beating than having to invest in security to try and minimize the possibilities of such breaches: the most stringent security does not guarantee that such breaches will not happen. Hence the current situation: everybody pays lip service to security, claiming that it is very important. But, when the time comes to investing in security, most do not - because it is really not worth the while.