Evaluating Cybersecurity Risks and Preparedness in Target Companies

October 08, 2015

Before committing resources to a potential investment, private equity firms should aggressively evaluate a target company’s cyber risks and cyber preparedness. Some target companies are naturally more exposed to cyber risk than others because they collect and store information that criminals are interested in stealing—information such as customers’ names, Social Security numbers, tax information, credit card information or financial account information. However, regardless of business type, virtually any company that caters to individuals is exposed to cyber risks if it has not adopted policies to protect customer information, or if it only has policies on paper and does not implement them in practice. This article will help private equity firms assess a target company’s actual cyber risks by guiding them through the diligence process.

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