UK small businesses are underestimating the impact a cyber attack could have on their reputation and must take steps to protect it, a study suggests.
Despite the vast majority (93 per cent) of small businesses thinking about their company’s reputation frequently or all the time, they are not considering how a security breach of their computer systems could affect them.
In fact, less than a third (29 per cent) of small companies surveyed that haven’t experienced a breach say the potential damage a cyber breach could cause is an ‘important’ consideration’, according to a report launched by the government’s Cyber Streetwise campaign.
However, 83 per cent of consumers surveyed are now concerned about which businesses have access to their data and whether it’s safe, and more than half (58 per cent) say that a cyber breach would discourage them from using a business in the future.
This is reflected by the fact that the majority (89 per cent) of small businesses that had experienced a breach, felt the attack impacted their reputation in some way, with 31 per cent of those having been breached reporting brand damage, 30 per cent reporting a loss of clients and a quarter receiving negative reviews on social media.
The impact can be long-lasting, with one in four (26 per cent) of those having experienced a breach being unable to grow in line with previous expectations, and almost a third (31 per cent) saying it took more than six months for the business to get back on track.
Quality of service is also a risk; those who experienced a cyber breach found it caused customer delays (26 per cent) and impacted the business’ ability to operate (93 per cent).
The lack of concern around potential reputation damage may be explained by the fact that many small businesses don’t realise the value of their data. The vast majority (95 per cent) of small companies surveyed hold data in the IT systems, yet more than a fifth of those surveyed (22 per cent) don’t consider it to be commercially sensitive.
Even though customer, financial and IP data can be shared with competitors if a company is attacked, just one in five (19 per cent) small businesses say they would be immediately concerned about competitors gaining advantage if they were breached.
The report also reveals that many small businesses (51 per cent) surveyed don’t think they will be a target for an attack, despite the majority of consumers worrying about the security of their data, especially in the hands of small businesses.
BJ Chong a partner and Data Protection and Privacy specialist with Palmers commented: “Small businesses are aware that their reputation is critical to their success and yet many do not seem to consider quite how many variable factors can affect it.
‘No business is immune to cyber crime – every piece of business data, no matter how unimportant it may seem – can be of interest to a cyber criminal.
“It is vital to take steps to protect your data, and with it the trust of your customers and ultimately your reputation.”
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