8 Steps for Conducting a Cybersecurity Risk Assessment (+ Free Template)

In today’s evolving world, it’s incredibly important to ensure that you stay on top of security and protect your business and customers' interests—and understand what happens when you stop investing in it. 

Take social media giant Twitter, for example. The company recently faced a mass exodus of employees, including cybersecurity staff. With the situation at Twitter becoming more turbulent due to troubling leadership decisions, they’ve become a prime target for retaliation—such as bad actors gaining access to users’ private messages.

You need to protect your data from potential cyberattacks and other identified risks. When you have security controls in place, you can satisfy both stakeholders and your clients.

Your cybersecurity framework will include many elements essential to keeping your information technology secure and protecting sensitive data. One important step in that process is cybersecurity risk assessment. In this article, we’ll help you understand what a cybersecurity risk assessment is and how you can create one with the help of a free template.

What is a cybersecurity risk assessment?

A cybersecurity risk assessment is a process that helps you understand where potential vulnerabilities exist in your organization. It helps you find potential risks, prioritize them, and create a plan to address them.

Cybersecurity risk assessments are just one part of your entire risk management strategy, but they have a key role. It’s important to take a strategic approach to a risk assessment and follow the necessary steps to make sure you cover all your bases and protect your assets along the way.

Examples of cybersecurity risks

Cybersecurity risks come in many different forms. These attacks target your servers and your data, hoping to damage your business or get money to the hacker. Here are a few of the common examples of cybersecurity risks you may face:

• Ransomware: Ransomware is a type of malware installed onto your server that locks key functions of your organization. Hackers will demand a ransom to unlock those features and allow you to return to business. A group of cybercriminals dubbed the Daixin Team recently launched a ransomware attack on AirAsia, leaking the personal data of 5 million customers and the airline’s employees. Read the full story here.
• Data leaks: Leaks can come from a number of sources, including misappropriated information and unauthorized access. These leaks give sensitive data out to the general public and can harm a business’s reputation. These leaks affect more than just businesses: U.S. Immigration and Customs Enforcement (ICE) unknowingly leaked personal information for over 6,000 immigrants fleeing their countries—a major safety risk and security blunder. You can find out more about what led to the leak here. 
• Phishing: Phishing is a scheme where hackers will send an email or text to an employee of a business pretending to be an authority figure. The criminal will ask the employee to give confidential information to them, such as passwords, logins, and account information. Read more on how the holiday shopping season can lead to a rise in phishing activity for online retailers.
• Malware: Malware stands for malicious software and often comes in the form of a link or corrupted file. Once someone within your organization clicks the link, the malware will install itself on your servers and attack your business — usually to transfer money to the hacker. Your security team should be on the lookout for common file types that hackers use to hide their malware, including ZIP and RAR files, which accounted for 42% of malware attack attempts in 2022Q3. 
• Insider threats: Your workforce or third-party vendors are often a source of vulnerability, even if they don't mean to be. Without training, employees can accidentally give out vital information and hurt businesses. In 2021, Meta fired dozens of employees for abusing their support system, which granted them improper access to user accounts—some even accepting bribes to do so. Read the full story here.
• Cyberattacks: Cyberattack is a general term used to describe the practice of hacking a network to damage or destroy a system. Cyber attacks are becoming more popular with criminals as a way to steal and damage businesses. A cyber attack that hit Washington County, MD, in 2022 disrupted county services—including 911 emergency communications. Read more on the extent of the damage here. 

Why a cybersecurity risk assessment is important

It’s important to remember that not just small businesses are at risk for cybersecurity risks. Major enterprises like Dropbox, Toyota, and American Airlines have experienced recent data breaches, and IBM estimates that the average cost of a breach hovers around $4.24 million. 

A cybersecurity risk assessment does more than just protect against cyber attacks. It also provides other important benefits to your organization, all of which can help protect you from damage and safeguard your interests.

Protects against data breaches

Data breaches are dangerous to businesses. Even if the breach is sealed, there is still damage to your business reputation. Customers might not trust a business that has been the victim of a data breach, and even your customers and investors might lose trust in the organization. Cybersecurity risk assessments help keep your business safe by being proactive.

Ensures regulatory compliance

Organizations must meet many compliance standards to keep and store sensitive data. When you have regular cybersecurity risk assessments, you can ensure that you are meeting those compliance standards and not putting your business at risk of a violation. That keeps data safe and helps you avoid hefty fines.

Maintains trust with customers and third parties

Vendors and third parties rely on your business for their business. You need to keep their trust and their business. You also want to ensure that providers are protected against cybersecurity threats, especially if you share systems. By having cybersecurity risk assessments for your vendors, you can protect their interests and yours.

(Looking for further guidance on establishing a thorough vendor risk assessment? Check out this helpful checklist.)

Unlocks cost savings

It can be expensive to protect your data, especially if it is being done efficiently. Cybersecurity risk assessments help you identify potential cost reductions and savings. They can also help you avoid fines and other costs associated with compliance violations and data breaches.

Improves organization knowledge

To protect the company's data, every employee needs training on cybersecurity best practices and protocols on what to do in the event of a data breach. By having risk assessments in place, you can train your staff accurately on what needs to be done to keep data secure and avoid falling for schemes and scams.

Essential components for a cybersecurity risk assessment

Every cybersecurity risk assessment report, no matter which template you use, should have a few similar elements that keep the process moving and gather important information:

General information

The first component is fairly self-explanatory: You need general information about the business to get started. Before diving into the details, you first need to scratch the surface with your information. This gives you a foundation from which to build your cybersecurity processes.

Company details and product details

You will need both company details and details about products to accurately gather all of the general information you need to begin your cybersecurity risk assessment. Those details include things like:

• Company name
• Website URL
• Exchange and ticker symbol
• Material claims
• Product names
• Product descriptions
• Product URLs

Compliance documentation

The next component you need to consider is your compliance information. You need to understand exactly what standards you are being held to, to ensure that you don't violate any regulations in your country, state, or industry. Common compliance documentation might include:

• GDPR
• SOC2
• CCPA
• ISO
• SSPA
• CMMC

Security policies and practices

Finally, you need to consider the different security policies and practices you already have. These policies could include everything from basic password policies to incident response forms. 

Examples of security policies and practices

Some of the policies, documents, and procedures you might need to include in this component include your:

• Access control policy: Documents who has access to what within your organization.
• Asset management policy: Documents how your assets are managed and who is responsible for different assets.
• Change management policy: Documents how you manage major changes and developments in your organization and your products.
• Information security policy: Documents your policy for handling your information and controlling who has access to it.
• Incident response policy: Documents how you respond to incidents and how you record them.
• Password policy: Documents your regulations around passwords and how frequently they are required to update or change.
• Third-party management policy: Documents your process for controlling and managing third parties (may include a vendor risk assessment).

8 steps for conducting a cybersecurity risk assessment

Now that you know what components you need to get started, let’s go through the steps you need to take to conduct a cybersecurity risk assessment.

1) Evaluate the scope of the risk assessment

As with most processes, the first step is to evaluate the scope of your assessment. You want to ensure that you cover all of the assets that could be at risk, but you don’t want to overdo it. Think about how much of the organization you want to cover in the risk analysis and what type of assets you will be looking at. This keeps the assessment from becoming overblown and too big to manage accurately.

2) Determine the value of assets

The next step is to look at the assets that fall under the scope of the assessment. Compile a list of what they are and their value to the company. By creating an inventory of information systems, you can take stock of what assets you actually have and how important they are to the operations and functionality of your business.

3) Identify cybersecurity risks, threats, and vulnerabilities

Once you’ve compiled all of your assets, you can move on to the next step of the risk assessment process and identify the different cybersecurity risks, threat sources, and vulnerabilities that they potentially are at risk for. This is one of the most important steps in the data protection process, so make sure you carefully examine how each asset could be exploited or attacked and how that could impact the company.

4) Pinpoint the likelihood of incidents

While you can come up with wild scenarios for cyberattacks and data breaches, you want to make sure that your theories are grounded in the reality of the potential impact. Make sure you prioritize the likelihood of incidents and the level of risk, so you address the most likely cases of vulnerability first. This helps your assessment stay organizational, and your remediation and risk mitigation plans stay reasonable.

5) Examine the controls and measures in place

Next, consider what controls and measures are already in place to protect assets and sensitive information. What safeguards does the business have for each asset, and how often are they examined and checked to ensure they will still protect the asset? You can also examine your broader security measures and how effective they would be in the case of a cyberattack.

6) Prioritize the essential cybersecurity risks

Staying organized, prioritizing the right measures, and planning your action plans are all important factors of a cyber risk assessment. You want to begin with the biggest potential threats and work down from there. Put your identified risks into a prioritized list, so your incident response team knows where to start.

7) Recommend the steps necessary to mitigate risks

Once you know where to begin, you can start putting together the steps you will need to mitigate and address any risks. This might include looking at new security systems, IT security tools, or third parties that deal with digital security. By taking action, you can prevent major damage down the line and protect your assets proactively.

8) Monitor security controls regularly

Cybersecurity is an ongoing process. You will need to monitor your security controls regularly and run risk assessments to ensure you remain secure, compliant, and ahead of any potential risks. This helps create a culture of security in your organization that helps your business protect sensitive data and avoid cyber attacks.

Get started with a free cybersecurity risk assessment template

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At HyperComply, we understand how important it is to have cybersecurity. That’s why we offer AI tools and automation to make risk assessments easier to conduct and more accurate. We also have free tools to use so that you can start your cybersecurity risk assessments today — rather than waiting until it is too late. 

Check out our free cybersecurity risk assessment template today and discover how HyperComply can help your data security.