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Budgets to Breaches: Why CFOs Are the New Frontline in Cybersecurity

As digital transformation reshapes industries, cybersecurity has become a critical issue for every organisation with CFOs now at the forefront of this battle. Challenges such as financial stability, operational continuity, and reputation on the line, the role of CFOs has evolved far beyond managing budgets and cash flow. This means that CFOs now need to step out of their comfort zones and actively engage with the cyber threat landscape, much like how they adapted to roles like ESG (environmental, social and governance) leaders. Today, safeguarding an organisation against cyber threats is as much a CFO’s responsibility as ensuring profitability.

In Australia, the stakes are particularly high. The country’s centralised data systems and essential industries make it a prime target for attackers. Most Australians have been impacted by at least one cybersecurity breach within the last year—a stark reminder of the vulnerability businesses face.

For CFOs, this represents not just an organisational risk, but a personal one. Cybersecurity breaches are increasingly seen as a leading reason CFOs can lose their jobs, alongside cash flow crises, major controls issues, and financial misconduct.

Why CFO’s need to take responsibility for security

CFOs can no longer be ‘just the bean counter.’ Understanding cybersecurity requires CFOs to dive deeper into unfamiliar terrain, understanding both the threat and stakeholder landscapes to make informed decisions. This role requires a strategic mindset, balancing innovation and continuity. While technical knowledge lies with CISOs and CIOs, CFOs must play a leadership role in ensuring the organisation is prepared for the financial and operational fallout of a breach.

The financial implications of cyber-attacks cannot be overstated. Between 2021 and 2023, cyber insurance rates surged significantly due to the escalating threat landscape. However, investments in robust cybersecurity measures have helped stabilise premiums.

Nevertheless, failing to invest sufficiently in cybersecurity can lead to far more severe consequences, including data breaches, operational disruptions, and irreparable reputational damage. In today’s business environment, cybersecurity has become as essential to risk management as cash flow, internal controls, and financial reporting.

CFOs must ask critical questions, such as:

Are we allocating enough resources to cybersecurity?

Do we have the right frameworks in place to protect our organisation effectively?

Analysing the cyber threat landscape

The cybersecurity landscape is becoming increasingly complex. As more businesses become digital, attackers are becoming increasingly sophisticated, with high incentives and advanced tools like AI enabling them to scale attacks. Australia’s centralised government data and concentrated industries make it an especially lucrative target. Hackers see opportunities to breach large repositories of sensitive information with minimal effort, amplifying the potential damage of each attack.

At the same time, AI, while offering opportunities for innovation, introduces new vulnerabilities. Attackers are already exploiting these technologies to breach systems faster and more effectively than ever before.

Equally concerning is the diversity of attack methods. The alarming reality is that attackers face fewer barriers than businesses do—while we worry about bias or PII in AI, they’re free to innovate and exploit with no such limitations or concerns. Phishing, social engineering, and supply chain vulnerabilities are among the most common, with each relying heavily on human error or third-party weaknesses. These threats highlight the importance of not just technical defences, but also strategic planning and organisational awareness.

The evolving role of CFOs

Engaging with cybersecurity goes beyond understanding the technical details. It requires active participation in planning and preparation. The only way to truly understand cybersecurity is to get involved—attend forums, ask questions, and learn from CISOs and CIOs. It’s a hands-on challenge, but one that CFOs can rise to with the right mindset.

One of the most crucial steps is developing a breach playbook. Many CFOs would struggle to articulate what their organisation would do if breached tomorrow. A comprehensive playbook is essential, outlining immediate response steps, regulatory notification requirements, and prearranged agreements with insurers and cybersecurity partners. Having this plan in place can make the difference between a controlled response and organisational chaos.

Recognising the hierarchy of data within the organisation is equally important. Not all data is equally critical. While a breach of internal emails may be embarrassing, the exposure of sensitive data, such as source code, operational technology, or personally identifiable information, can cripple a business. CFOs must collaborate with CISOs and CIOs to ensure critical assets are identified, segregated, and secured.

Budgeting is another crucial area where CFOs must lead. Cybersecurity requires financial prioritisation, with most organisations allocating up to ten per cent of their IT budgets to security. In an environment where innovation is a priority, it is vital for CFOs to reprioritise and ensure that security investments are made before vulnerabilities lead to breaches. Similarly, ransomware preparedness is becoming unavoidable. While the notion of paying ransoms may seem unpalatable, it is a harsh reality for many organisations. CFOs must work closely with their insurers to understand the logistics of handling ransom payments, particularly in cryptocurrency.

Opportunities for Australian CFOs

Australia’s unique position as both a target-rich environment and a testbed for innovative strategies offers opportunities alongside challenges. The country’s diversity and economic significance make it an ideal market for trialling cutting-edge cybersecurity measures. Australian organisations have the chance to lead globally by implementing robust defences and sharing best practices. With strong measures in place, businesses can confidently embrace new technologies like AI while protecting their data and systems.

Investing in cybersecurity is not just about protecting assets; it’s about enabling innovation and growth. The centralisation of data and industry in Australia makes it critical to secure these assets, not only for the benefit of the organisations themselves but also to maintain the country’s standing as a global economic leader.

For CFOs, the message is clear: cybersecurity is no longer just an IT issue—it is a core business priority. CFOs need to ensure their organisations are not just defensive but prepared. This includes having a response plan, engaging ethical hackers, and understanding the logistics of ransomware payments, even when cryptocurrency is involved.

Cybersecurity is not solely about defence; it is about resilience. By taking proactive steps now, CFOs can safeguard their organisations, foster innovation, and lead with confidence in an increasingly digital world.