Aug 17 2009

Security breaches don’t affect company reputations

Published by at 7:10 am under General,Privacy,Risk

Sigh.  I’d figured this out on a gut level some time ago, but it’s disheartening to see it actually put down in writing: A security breach won’t affect a company’s reputation in the long term.  Or even that much in the short term.  If the TJX compromise taught us nothing else, it’s that the average investor doesn’t follow the breaches or doesn’t care about the impact a company’s security has on it’s customers if they do.  TJX actually used their compromise as a marketing opportunity and showed a minor uptick in business after the compromise.

As Larry Walsh points out, reputation fluctuates by a company’s actions and security is only a minor part of reputation.  Based on what we’ve seen historically, it’s only a very small part, which is incredibly sad.  People either don’t understand or don’t care about what a breach is going to do to their privacy and credit.

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2 responses so far

2 Responses to “Security breaches don’t affect company reputations”

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  2. Penetration Testeron 10 Sep 2009 at 2:15 am

    I would have to agree with this based on what i have seen out there. It’s weird. It seems only security folk get put off by a breach, but the consumers keep on shopping. After one breach in Australia I saw a notice saying “we don’t store cardholder data”, but the reports in the paper said fraudulent transactions took place on consumers credit cards who shopped there. How did they get them if they weren’t stored?

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