A Guide to Nonprofit Risk Management and Cybersecurity

We are living in an age that is characterized by risk. Every decision a company makes needs to take various risk factors into account. If you fail to properly consider risks through a risk assessment and risk management, it could be disastrous for your company.

One area in which non-profit organizations frequently miscalculate risk is cybersecurity. This article explains how you can secure your organization against various cyber threats.

What Is Risk Management?

Essentially, risk management involves trying to foresee what could go wrong for your organization. You then take measures to mitigate the risk. Of course, organizations don’t take measures against every conceivable risk. Instead, they evaluate each risk based on perceived likelihood and expected damage.

For example, consider an event such as a meteor hitting your office. The damage from this kind of event would be catastrophic, but it’s very unlikely that it would ever happen. Therefore, a risk management analysis would conclude that there’s no need to take measures against a meteor strike.

On the other hand, events like a fire happening on the premises are much more likely, and the damage from such an event could be just as severe. Therefore any reasonable risk management strategy would take fire into account.

Risk management looks at both intentional harms caused by malicious actors and accidental harms.

Cyber Risk Management

Some of the biggest risks you’ll face in nonprofit security are cyber threats. These kinds of threats involve harms caused by computers and computer network systems. Most organizations have robust and sensible risk management approaches when it comes to “real life” threats such as fires and earthquakes, but their approach to cyber risks is often lacking.

This is because digital technology has progressed so quickly in the last few decades. Risk management approaches have not had time to catch up. It doesn’t help that many people in management positions are not very knowledgeable about computers and the internet.

Unfortunately, this means that many nonprofit organizations take a reactive rather than a proactive approach to cybersecurity. You can’t afford to take this kind of approach to cybersecurity as threats like data breaches could have a devastating impact on your organization.

Data Security

As a nonprofit organization, one of the biggest cybersecurity threats you face is a breach of your data. Quite often, if data is stolen from your organization, it will mean you’re in violation of data privacy regulation. This could result in fines or other legal action against your organization. It could also have a negative impact on your reputation.

Your risk management strategy should involve reviewing your cybersecurity. This should be on the hardware and software level. For example, all employee workstations should have antivirus and firewall software installed. If you don’t have dedicated IT support staff at your company, you might consider working with a managed IT company.

Two-Factor Authentication

One of the best and most efficient ways to protect yourself against a data breach is to use some form of 2-factor authentication. Basically, this involves using a second device to verify your identity.

The most common form of 2-factor authentication is using a cell phone to verify who someone is who is attempting to log in. This is an effective security measure because it means a hacker who has the password of an employee still won’t be able to log in.

Consider setting up such a system to protect yourself against a data breach.

Consider Social Engineering

One mistake that organizations often make is that they focus all of their risk management on software protection. This is certainly important, but many cyber-attacks involve using social engineering to breach a system.

Social engineering involves using trickery and manipulation in order to breach a system. A firewall or antivirus software won’t be able to protect you against this kind of attack.

An example of a social engineering attack might be an attacker calling up someone at your company. They might then and convince them to give out their password. It might sound implausible, but it’s a lot easier than you might think.

Security Culture

Sadly, there is no straightforward solution for dealing with social engineering attacks. If you want to protect yourself against this kind of risk, you need to create a strong security culture in your organization.

This means that everyone in your organization takes security seriously and knows how to recognize cyber threats. A common way to achieve this is through seminars, presentations, and other activities.

With that said, you can’t just host a seminar on cybersecurity risks and call it a day. Cybersecurity is a constant process. To achieve a true security culture, employees need to have security on their minds at all times.

It helps to have a dedicated member of staff responsible for investigating potential cyber threats. Staff should report and all suspicious activity to this individual. This should be encouraged, even if the majority of reports are false positives.

Consider Shadow Security

Security culture is important, but pushing security too much can actually make your company less rather than more secure. When you implement excessive security policies, this results in what is known as shadow security.

Shadow security is when workers find the official security policy too restrictive. In response to this, they may adopt their own unofficial security methods.

This is problematic because most of your workers are probably not security experts. This means that they may inadvertently do things that could cause a data breach or some other threat.

To avoid this kind of behavior, you need to have an open dialogue with your employees. People may feel like the official policy is interfering with their ability to get work done. you may need to modify the policy to avoid workers taking matters into their own hands.

Risk Management Is Crucial

As you can see, risk management is crucial for running a nonprofit company. You need hardware and software solutions to keep your digital environment safe. You also need to develop a strong security culture in your organization.

If you want to learn more about running a nonprofit organization, check out our FAQs page.