Gaining actionable insight into security risk ratings for mergers and acquisitions



RiskXchange can aid in effectively managing cybersecurity risks during mergers and acquisitions.


Gaining actionable insight into security risk ratings for mergers and acquisitions (M&A) enables businesses to measure the cybersecurity performance of potential portfolio companies or acquisition targets.


The need for security risk ratings follows concerns over cyber risks and the importance of cyber assessment during M&A. It is important to determine how prepared your organisation is to deal with cyber risk during M&A from the perspective of both business decision makers and IT decision makers. Using cybersecurity ratings helps businesses take an in-depth, risk-based, and results-driven approach to managing the performance of its cybersecurity program. 

As part of the due diligence process before, during and after acquisition, the key factors to consider include whether cyber incidents cause delays in acquisition, weighing up what cyber risk means for companies looking to acquire another and how best to minimize risk and protect the company.


Let’s take a closer look at how to effectively manage cybersecurity risks during mergers and acquisitions.


Identifying the problem

Companies are often left in the dark when it comes to how to identify cyber risks. Clear evidence has been provided in past M&A that prove cyber threats have a negative effect on company value which in turn can effect acquisition.


Although penetration tests and questionnaires can provide one level of insight into security practices, they can prove time-consuming and do not always provide a holistic viewpoint. Without continuous measurement and monitoring, a quantified baseline and comparative data, organisations are limited in their ability to measure the impact of risk mitigation efforts for potential acquisitions.


Finding a solution


RiskXchange cybersecurity risk ratings are based on readily available public open-source data and represent an aggregate measure of security risk across all parties. These ratings are one component within a broader cyber-risk identification and assessment programme, which can help monitor organisational and third-party risks.


By delivering timely, data-driven reports into an organisation’s cybersecurity performance from the outside, the findings provide continuous visibility into the security of important assets.


By being able to delve deep into the security details used to generate an organisation’s rating, security teams can identify, locate, and mitigate risk immediately. Historical data also gives companies the ability to track progress of security mitigation techniques over time and measure improvements in the incident response process.


Continuous monitoring


RiskXchange Cyber Risk Ratings are an empirically derived set of metrics that rely on a comprehensive and diverse set of cybersecurity risk signals, collected at internet scale, to measure the forward-looking security risk of any organisation. Security ratings give a calculated assessment of an organisation’s effectiveness on all aspects of security performance.


Ratings draw upon a range of data to analyse and inform, ultimately enabling organisations to objectively review and act upon their processes and the security measures they have in place. What’s more, the ratings help to identify challenges and opportunities to make improvements. An up-to-date security-risk rating enables better management of an organisation’s cyber risk, delivering:


• Insight into risks associated with third or fourth parties and supply chain relationships. When a security rating is in place, it can significantly aid the effective management of cyber risk from external parties.


• Enhanced cyber-security due diligence, which is hugely important during periods of business growth, including the acquisition of or investment in a company. Organisations must be able to access enhanced information and continually review any investment; access to a security rating facilitates this.


• Improved insight into Critical National Infrastructure (CNI) for governments, ultimately enabling better management of national cyber-security performance.


What’s more, security ratings also aid the ongoing management of an organisation’s internal cyber activity, including risk and compliance. In this domain, a rating enables:


• Rolling assessments of internal security activity, helping to provide clarity to a range of stakeholders.


• Industry-wide benchmarking, including peer-to-peer and competitor.


• Greater customer confidence in the organisation’s digital presence and activities. This higher level of confidence impacts other organisations with vested interests including third parties, stakeholders, and industry regulators.


How RiskXchange can help


RiskXchange is one of the firms leading the fight against cybercrime, coming up with novel solutions to everyday problems experienced at the hands of hackers. We are a respected provider of cybersecurity ratings and can aid in effectively managing cybersecurity risks during mergers and acquisitions.


With full visibility over your eco-systems' entire attack surface in near real-time, you can regularly monitor and mitigate risks to prevent unnecessary exposures. Our passive data collection methods are effective and have no impact on your network performance. Using data-driven insights to prevent breaches is the best way to reduce an attack surface and prevent cyberattacks. 


About RiskXchange


RiskXchange provides a powerful AI-assisted, yet simple automated and centralised 360-degree cybersecurity risk rating management approach. We generate objective and quantitative reporting on a company's cybersecurity risk and performance, which enables organisations with evolving business requirements to conduct business securely in today's open and collaborative digital world. 


RiskXchange is an information security technology company, which helps companies of all sizes fight the threat of cyber threats by providing instant risk ratings for any company across the globe. RiskXchange was founded and is led by recognised experts within the security industry, who have held leading roles within companies such as IBM Security. 


Find out more here.

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