Cybersecurity awareness and market valuations

Abstract

This paper introduces a measure of firm-specific cybersecurity awareness that can be used in empirical research exploring cyber-related issues facing corporations. It extends and updates Gordon et al. (2010), who develop an indicator capturing the existence of disclosures related to “information security” and show a positive association between market valuation and their measure. Since publication of their paper, cyber-related events have become more frequent and salient, and disclosure of cybersecurity issues has become more extensive. Increased disclosure is largely due to a 2011 requirement by the Securities and Exchange Commission, which provides guidance for disclosure of cyber-related ..