Counterpoint: Cyber Regulation is Next to Impossible
Government regulations on the reporting of cyberrisk in the private sector cannot succeed. It's not that the government shouldn't be attempting to protect taxpayers and investors from this risk, because it should. It is right-minded to do so.
Cyber regulation at the national level and the international level is well-intended. But the execution of it is a near-impossible task.
Look at the history of warfare. We have moved from troops standing in line shooting at each other, to cells of hackers operating in cities and towns across the globe.
So how can governments create an international agreement, even if they wanted to? We live in a world where cyber crime is no longer just the province of teenage underground anarchists, or even domestic or foreign organized crime groups. Some governments house hacker cells -- affiliated with their own military in some cases -- that are carrying out attacks on U.S.-based businesses.
To implement international laws, governments would have to be able to assure the countries that they are negotiating with that they can regulate Internet usage in their own countries. But we know they can't do that. Some countries don't even have cyber crime laws on the books yet.
Cyberrisk is a serious issue, but cyber regulation is not the answer. Regulation is deadly slow and not prone to evolve in real-time. It would be handily outpaced by the changing landscape of cyber space and cyber crime, leaving companies strangled by the outdated and ineffective burden of irrelevant mandates.
The worst part of all is that cyber regulation puts the emphasis on compliance rather than the real goal: countering the threat.
The good news is that industry does not have its head in the sand. There are a plethora of organizations working to develop standards and best practices related to cyber security. The International Organization for Standardization (ISO) alone has published more than 200 standards for information security. ISO and more than a dozen other international organizations are actively involved in developing and refining a framework of cyber security agreements and standards. These standards-setting bodies are equipped to respond more swiftly than regulators to keep pace with changes.
Government can help protect citizens and businesses from cyberrisk. But that can best be accomplished by partnering with industry and cooperating with the many organizations that are already working to make cyber space a safer place for citizens and for commerce.
Dan Reynolds is editor-in-chief of Risk & Insurance®. He can be reached at firstname.lastname@example.org.
September 15, 2013
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