Socio-Economic Factors On Sector-Wide Systematic Risk Of Information Security Breaches: Conceptual Framework
Syed Emad Azhar Ali
Abstract
This paper aims to propose a conceptual framework for investigating the impact of Socio-economic Breach Contingency Factors (BCFs) on banking sector’s systematic risk. The study adopts an event study methodology comprising 200 global incidents of Information Security (IS) breaches occurring in listed banks. The Socio-economic BCFs will be proxied by (1) Cyber Crime Fear in a Country and (2) Information & Communication Technology (ICT) Penetration in a Country. The proposed framework aims to validate the nexus of socio-economic factors and systematic risk through which shareholders and bank managers can assess the risk of possible market value losses at the incident of IS breach in the banking sector. Considering the scenario of IS breach, this paper will make a significant contribution to the theory of efficient market hypothesis by way of extension and integration of theories. EMH under the context of IS breach has been limited by the BCFs of attack type, firm type, and industry type.