HM Treasury highlights the value of cyber resilience in strengthening economic and organisational security

HM Treasury has published a report setting out evidence on the economic and financial value of operational resilience in financial services, with a particular focus on cybersecurity.

The report highlights the growing challenges facing organisations and markets as cyber risk intensifies, identifying an increase in the severity of cyber-attacks and the scale of their consequences. It warns that a small number of severe incidents can lead to disproportionate financial losses, with losses for large firms potentially approaching GBP466 million, significantly exceeding the cost of day-to-day incident activity. The consequences of such losses are becoming larger and more persistent, with potentially lasting effects on affected firms. Beyond financial loss, the impact can extend to customer trust, reputation, and investor confidence, highlighting the importance of resilience.

The report also encourages firms to reframe operational resilience as a source of growth, rather than merely as a compliance obligation or cost. HM Treasury suggests that more resilient firms are better positioned for growth and performance, as they can recover faster and sustain operational momentum. The report cites evidence that more resilient firms outperform their peers in areas such as revenue growth and profitability.

Furthermore, the report notes that, as digital technologies evolve, the scale and severity of cyber threats are likely to increase. Organisations with stronger resilience will be better equipped to modernise systems and adopt new technologies with less disruption. The report also notes that only 10% of organisations report being prepared for AI-augmented cyber threats and that 77% lack essential data and AI security practices.

The report concludes that operational resilience and cybersecurity should be treated as strategic capabilities that support financial, operational and reputational growth. It emphasises the significant value of improving resilience in order to protect firms against increasingly sophisticated cyber threats, including those augmented by AI.

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