Modern Governance

Post-Yahoo breach, is your board now your weakest link?


While data breaches continue to occur in record numbers, only a handful have caused fundamental shifts in the ways businesses operate; Target and Sony are among them.

The collective business world got its latest wake-up call, this time following the Yahoo breach of more than 500 million user accounts. On the surface, the breach seemed similar to countless others that had preceded it - names, email addresses, passwords and other basic PII were stolen in an alleged state-sponsored cyber attack. Yet if you take a closer look, the Yahoo breach has the potential to create a massive ripple effect, targeting the upper echelon of the business community in its wake - board members and directors in particular. To make matters worse, risk management and compliance officers might not even be aware that the vulnerability exists. Why is this so?

According to Diligent's research, roughly 30 percent of U.S. board members are using free email service providers (ESPs) like Yahoo to conduct business. Gmail is the most commonly used (44 percent), followed by AOL (17 percent), Yahoo (9 percent) and Comcast (7 percent). More alarming is that an additional 23 percent use email domains that are virtually unrecognizable by today's standards. This signals that many board members have not evolved with modern security best practices or have created their own workarounds out of personal convenience. Or worse, they have not been held to the same standards as other employees.

With hackers and other bad actors one step ahead of even the most secure organizations, email will remain a nonsecure way for board members to communicate and share files. The recent Yahoo breach underscores this point in dramatic fashion. One stolen email address, password or even a contact list belonging to a board member is all a seasoned hacker needs to carry out exploits designed to access confidential data, expose corporate secrets or carry out more sophisticated attacks, such as phishing, for personal and political gain.

With approximately one-in-three board members using free ESPs for work, it's likely that someone on your board (or someone in their network) is putting your organization at risk. In the wake of the Yahoo breach, here are three things all compliance professionals should do to limit their organization's exposure and regain critical control over the highly sensitive data handled at the board level.


Because web-based ESPs like Yahoo sit outside of IT's control, it's likely that executive communication sent through these channels is misaligned with the organization's own established security protocols and governance standards. The challenge for the risk and compliance function in this case not only involves knowing who on the board could be impacted, but more importantly, what information he/she has shared and with whom. In the weeks and months following the Yahoo breach, it's critical to make your board members aware of the risks they may personally face, audit their use of personal email addresses for work purposes and, if needed, involve other key stakeholders to determine if more drastic data recovery, back-up or compliance-related activities need to occur.


While board members play critical roles in developing and/or approving a corporation's security policies/procedures, they may not be following the letter of the law themselves. In fact, it's not uncommon to find out that board members have never received detailed training or proper instruction on security protocols and/or prohibited behaviors. As data breaches become a certainty for all businesses, no compliance or risk management professional can afford to leave security to chance. Instead, board members need to be trained or retrained at least once per year, as well as given on-demand access to security protocols and procedures. In some cases, more in-depth workshops or drills may be necessary to help educate less technologically savvy board members on the ever-evolving risks they are likely to face online.


The idea of governing the governance group may seem daunting, but it's essential to eliminate vulnerabilities, reduce risk and ensure companies are operating in compliance with various laws/regulations. Technology platforms designed exclusively for senior executive use, such as board portals, are an effective way to ensure that board members collaborate and share information securely no matter where in the world they are, while giving IT back the power it needs to apply controls, ensuring adherence to its corporate data protection practices. And if that doesn't work, remember: money talks. Just ask Verizon, which is reportedly seeking a $1 billion - yes, billion with a B - discount on Yahoo's $4.8 billion purchase price following its massive data breach. No board member wants to be at the source of this type of loss - whether financial, reputational or both.

In a world where hobbyist and activist hacking has quickly given way to deliberate exploits, cyber espionage, ransomware and other debilitating cyber attacks, one weak link can quickly erode even the most sophisticated security operations. Taking these three critical steps will help ensure that the highly sensitive and valuable information your most senior executives handle remains secure - no matter how big of a target is on the board's back.

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