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According to a report by Shred-it, the information security service provided by Stericycle, 63% of C-level executives and 67% of small businesses in the U.S. do not have an incident response plan. With 75% of large U.S. businesses surveyed stating they have experienced a data breach, incident response plans can no longer be considered optional. Institutions are leaving themselves open to vulnerabilities, and the risks are always rising.

Last year, companies experienced a 141% increase in data breaches compared to the prior year, according to Risk Based Security’s 2020 year-end report. Furthermore, according to Shred-it’s report, one in four North American businesses are concerned that an attempted data breach in the next 12 months is very likely. A data breach not only negatively impacts an organization, but it affects C-level executives as well, resulting in termination (62%), legal issues (40%), staff termination (38%), financial loss (16%), and damage to their reputation (27%).

However, damage to business reputation and leadership credibility may have an even higher cost, as consumers are not afraid to take action if their data is compromised. Nearly 70% of U.S. consumers surveyed have been personally impacted by a data breach in 2021. Studies have shown that consumers will not only switch brands after a bad experience, but approximately three in 10 consumers will share their negative experiences with others. Most notably, 82% of consumers stated they decide who to do business with based on a company’s data security reputation. Nearly one in four will stop doing business with the company responsible for the breach, according to Shred-it’s report.

Data security must be a priority for all businesses moving forward, as there is an expectation from consumers that their information will be protected. Employees — and the customers they engage with — expect their data and information to be secure. Data security has quickly become a critical piece of the cost of doing business.

Read the full report by Shred-it.

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