Discerning Cyber Risk: The Sustained Negative Impacts of Cyber Incidents on Shareholder Value
A new study conducted jointly by ISS STOXX and ISS-Corporate examined the impact of reported cyber incidents on shareholder value, as measured by relative share price, across the Russell 3000 index over a three-year period (2022 – 2024).
The study found that share prices for firms reporting significant cyber incidents underperform the market by nearly 5% on average, and that the underperformance can be sustained over a year or more.
Download the report to discover:
- Share price underperformance begins quickly and remains impactful at one full year after significant incidents are first reported, with a peak negative average impact of nearly -4.9% after 250 trading days.
- Key Insights: The Finance and Banking sector and the Healthcare sector show the highest negative average impacts to relative share price in the months following a reported cyber incident (peaking at -8.5% and -8.3%, respectively).
- These two industries accounted for the majority of total incidents during the period studied (2022 through 2024).
The ISS Cyber Risk Score is offered to institutional investors through ISS Sustainability Solutions, the responsible investment arm of ISS STOXX, as a means for investors to understand forward-looking cyber incident risk and as an insightful tool for more meaningful issuer engagement. Separately, ISS-Corporate makes the ISS Cyber Risk Score available to companies for self-assessment, peer benchmarking, and third-party risk management.
