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THE RISK VERSUS REWARD QUESTION AROUND COLLABORATION TOOLS

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By Dave Henderson, co-founder BlueFort Security

 

Financial services organisations are increasingly recognising the importance of digital technologies as a driver for increased profits, regulatory compliance, and enhanced customer experience. As remote and mobile access have become more commonplace, digital technologies, including collaboration tools, have shifted from a ‘nice to have’ to a ‘must have’.

IT security teams within financial services, in particular, operate under the understanding that there must always be careful consideration to ensure privacy and security for all users, and their data. There are good reasons that laws and regulations like GDPR, CCPA and HIPAA exist and regulated firms must satisfy the FCA and PRA that they are operating within the strict guidelines that are in place.

However, if IT security teams weren’t stretched enough before March 2020, they’ve certainly got their work cut out for them now.  A geographically dispersed workforce, with hundreds of computers and devices all operating outside the protection afforded inside the corporate network has all the hallmarks of a cybersecurity disaster waiting to happen.

For financial services firms, the need to ensure markets are ‘clean’ and free from abuse is paramount. Working from home – which many will still be doing – places an immense burden on IT security teams as they must prove that appropriate controls over inside information and effective information barriers remain in place, regardless of where their teams are working from.

Julia Hoggett, Director of Market Oversight at the FCA, recently spoke out about the “challenges of surveillance driven by our new ways of working and the importance of effective culture to manage those risks”.

No wonder 91% of CISOs say they suffer from moderate or high stress.

 

Collaboration Application Sprawl

As employees have adopted a wide variety of tools for internal, external and ad hoc communications, many organisations find themselves in the challenging, and risky, situation of collaboration application sprawl. For the most part remote workers have simply been trying to find a quick and easy communication workaround to being physically separated from their colleagues. There was no malice intended.

However, there is a large elephant in the room when it comes to these collaboration platforms. The simple fact is that Slack, Microsoft Teams, Zoom and the majority of other similar tools aren’t very secure, and neither are shadow IT apps such as WhatsApp. Their sudden and widespread adoption has the potential to be a recipe for security disaster. Even if the legitimate user has no malicious intentions, these platforms are wide open for exploitation by cyber criminals. Earlier this year, Standard Chartered became the first global bank to ban the use of the Zoom video conferencing app and Google Hangouts, as a direct result of these security fears.

 

But what exactly is at stake here?

If a malicious actor is able to compromise a user account, there is a strong probability that they’ll gain access to a company network. And then once inside the corporate network there’s untold damage that could result. For example, they could pose as a trusted employee to share malicious documents or files to move laterally into other devices. Depending on how the platform is configured, they may also be able to move into file-sharing apps such as G-suite or Sharepoint to gain access to sensitive data.

 

Here are some classic collaboration platform cybersecurity mishaps:

  • TeamViewer is a collaboration software that facilitates remote control, desktop sharing, online meetings and file transfer.  A couple of years ago, the software had to issue an emergency patch for a bug that could have let attackers access users’ machines via desktop sessions. A separate social-engineering attack earlier last year used an illegitimate version of the software to trick users into surrendering access to their computer.
  • More recently, Abnormal Security researchers highlighted a multi-pronged Microsoft Teams impersonation attack where attackers were impersonating genuine Teams notifications to target employee credentials.  With newly registered domains and multiple URL redirects, these attacks demonstrated levels of sophistication far exceeding those seen in standard phishing campaigns.

Another significant security loophole with these collaboration platforms is that legacy security and data loss prevention (DLP) tools that have been in place for years to handle on-site collaboration and work environments are simply ineffective now that Google, Slack and Dropbox are part of our daily modus operandi. A key reason for this is because collaboration apps lack granular controls, meaning enterprises can only do so much to restrict how they’re used.

Also, because of the informal nature of the chat function in these platforms the lines between what’s appropriate to discuss – and what is not – can become blurred, leading to conversations straying into discussing sensitive data. The potential fallout from this could be  just as damaging to a company as the fallout of a successful phishing attack.

 

Minimise the risk, focus on the reward 

Clearly employee training is an important, and ongoing priority.  But for financial services firms, trust lies at the heart of everything, the focus has to be on protecting the data itself. And that means as organisations allow sensitive information to move off premises and into new collaboration platforms, they must ensure that employees are using and securing data properly.  As previously mentioned, there are good reasons that laws and regulations like GDPR, CCPA and HIPAA exist.

Strong data loss prevention (DLP) policies combined with a Cloud Access Security Broker (CASB) and Secure Web Gateway (SWG) will be ‘must have’ tools of the trade for any financial services organisations that are embracing digital technologies. These will provide both visibility into collaboration tool usage across the organisation – on a user, device and activity level – as well as the ability to enforce granular security policies, for example on files or messages containing sensitive or restricted data.

As we start to look ahead to next year, the only certainty for security teams is that 2021 will continue to be full of uncertainties. With the ‘work from home’ model now likely to be the norm, rather than the exception, IT security teams could face their toughest year to date.

Financial services firms are subject to especially stringent controls – and quite rightly so. When it comes to the introduction of new communication tools there is an expectation they will update their policies, refresh their training and put in place rigorous oversight reflecting the new environment. For example, policies should prevent the use of privately owned devices where recording is not possible.  Ultimately, there is definitely risk around collaboration platforms – but when robust, cybersecurity policies and tools are deployed, and enforced, the rewards win out every time.

 

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Financial Services Makes Gains In Employee Engagement

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By Phil Chambers, GM Workday Peakon Employee Voice 

 

A new report shows that the financial services industry improved in almost all elements of employee engagement last year. Can such momentum be sustained?

After more than two years of change, one thing is certain: keeping workers engaged has become more challenging – and more urgent. Record numbers of workers have left their jobs in the UK. And, as turnover has increased, employee engagement – people’s mental and emotional investment in their work and workplace – has been tested. In today’s climate, engagement isn’t a nice-to-have; it’s a business imperative – especially as companies with engaged employees are known to reap benefits including higher productivity, customer satisfaction, and profitability.

The financial services industry hasn’t been immune from the so-called Great Reshuffle. But, according to Workday’s latest State of Engagement Report, it did make measurable gains in employee engagement during 2021. Of the 17 industries analysed, financial services’ engagement ranking jumped from ninth to fifth place.

The report analysed nearly 9 million employee responses from almost 2.5 million employees throughout 2021. It compared the engagement scores given by employees working in different industries over the 12-month period, as well as scores for the 14 drivers of engagement – including autonomy, goal setting, meaningful work, reward, and recognition.

Organisations in the financial services industry have been considered less   quick to evolve than others. PwC recently characterised insurance companies, for instance, as “traditionally risk-averse and slow to change”. But, as the report shows, financial services clearly made some improvements. It is noteworthy given the enduring pandemic-related economic turbulence of 2021 – and the fact that during that time global engagement scores overall slightly declined.

 

Where The Financial Services Industry Improved in Employee Engagement

Remarkably, the financial services industry saw increased rankings and scores in all but one of the 14 engagement drivers that the State of Engagement report measures.

Of all 17 industries analysed, financial services took top place for goal setting by the end of 2021 (up from sixth at the start of the year) and landed among the top three sectors for strategy and recognition too. These strong results indicate the industry provided clear direction to its people at both individual and organisational levels, and appropriately recognised employees when they met their goals.

The improvement in the industry’s overall engagement, however, was driven largely by a sizable increase in its environment driver score in 2021, suggesting that a significant number of employees responded positively to having more freedom around where they worked during the pandemic. Before the pandemic, it was unusual for financial services firms to offer flexible options at all. But, in 2021, more than ever before, many firms’ employees were working remotely or enjoying a hybrid of both remote and in-office work – as and when offices started to re-open. This unprecedented choice in where, how, and when they worked was appreciated, as the report indicates, by many workers in the sector.

 

Where There’s Room For Improvement

As the report found, many employees feel the amount of work they have is increasingly unmanageable. Workload continues to be a pain point across all industries globally, with workload satisfaction scores dipping slightly in 2021. At the end of the year, financial services received its lowest engagement-driver score for workload and ranked 11th among the 17 industries analysed.

This indicates employees in the financial services industry found their workload less manageable as the year progressed, which is perhaps unsurprising when considering the pandemic’s ongoing toll in many parts of the world, and the fact that remote working can lead to ‘always-on’ work lives.

To help mitigate burnout risk and diminished engagement going forward, financial services leaders and managers will need to stay close to their employees in the months ahead to find out how they can best support them, whether that’s with additional resources, greater work flexibility, or updated benefits. By regularly staying abreast of people’s needs and taking the necessary action, organisations can spot potential problems before they lead to resignations.

 

What The Industry Should Avoid Going Forward

In recent months, we’ve seen some financial institutions try to take a “return to normal” approach, requesting their people go back to working onsite five days a week. But, as the report shows, this approach may not be the best one for everyone, particularly as the past two years have revealed that many employees appreciate and benefit from a greater degree of flexibility.

Of course, not all organisations will be able to provide hybrid or remote arrangements for all their people. But greater flexibility doesn’t necessarily have to mean working remotely. It could mean more flexible scheduling options, or a shift in working hours to enable a greater work-life balance.

Either way, to retain the engagement gains achieved in 2021, the financial services industry should resist the temptation to look back, and must instead take learnings from the past two years. Amid so much economic and societal change, and with employees continuing to shift jobs in record numbers, companies cannot simply go back to before, but need to continue moving forward, listening to the needs of their people, and leading with empathy.

Specifically, leaders and managers in financial services will need to stay closer than ever to employee feedback, going beyond listening and working fast to implement change accordingly.

For the industry to continue making positive gains in employee engagement, it will need to: consider how to retain a degree of flexibility – updating models to reflect evolving employee needs; continue to provide clear individual and organisational direction to those working remotely and on site; create and maintain more manageable workloads through prioritisation and automating repetitive tasks; and continue to reward and recognise employees for their hard work and achievements.

While great strides were made last year, it’s more important now than ever that leaders in the financial services industry determine and understand how employees are feeling so that organisations can explore and shape a future of work that works for everyone.

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The FTX collapse: Lessons learnt for the CFO

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‘A complete absence of trustworthy financial information’ were the words used to describe the cause of cryptocurrency exchange FTX’s demise last week. Although an extreme example of incredibly poor risk and data management, it brings to light – yet again – the importance of getting financial planning right.

Following the collapse, the question on everybody’s lips has been – could this have been avoided? The answer is highly complex, however identifying, managing and mitigating internal and external risks should be at the top of senior leadership’s priority list – simple. The teachings here for CFOs across all industries are rooted in risk management. It was a lack of planning from senior executives that caused the current crypto industry crisis and should be considered a wake-up call to senior leaders across a multitude of sectors.

We are entering an uncertain economic winter, and CFOs are facing risks previously unknown, which are going to be impossible to mitigate without valuable insight and suitable technology. In the rocky months ahead, operational ‘leaks’ or financial losses will not be limited to crypto companies resisting the lasting effects of FTX’s collapse. If businesses across all sectors are to survive one of the most complex economic environments in recent times, CFOs will need to ramp up their risk management.

Hartmut Wagner

A Deloitte survey of CFOs found that 63% believe recession will hit within the next year and are already dealing with the sharp rises in financing costs. Additionally, the International Monetary Fund (IMF) has forecasted that global growth will falter from 3.2% in 2022 to 2.7% in 2023 because of tightening financial conditions in most regions. Ultimately, the outlook is challenging enough without the prospect of avoidable risks that can be prevented with the right planning and processes.

 

Automate systems or sink

Recent Gartner data shows that under one-third of CFOs are confident that technology they have available to them can ensure future company success. But to survive the recession and thrive on the other side, technology will be key throughout the finance function.   The Great Resignation has also added urgency for CFOs to automate more business and financial processes. The labour shortage, which started in hospitality and airlines, has hit the financial sector and has created a skill gap that senior leaders are battling to fill. No one is immune, as even Deutsche Bank and Goldman Sachs are suffering ‘talent wars’ as they fight to attract and retain finance professionals.**

Additionally, CFOs are facing ‘quiet quitting’, another problem that translates to increased employee disengagement which has recently gone viral across social media. The trend, gaining traction across Europe, encourages workers to avoid going above and beyond their job description and is lowering productivity levels. Automating the finance function, for one, alleviates the pressure on stretched teams by adding a virtual ‘team member’ that can take over repetitive and time-consuming transactional processes. This can break the negative cycle of further resignations as remaining employees will have more time to focus on strategic decisions, offering them the chance to become true value creators. Removing these arduous manual tasks will also attract employees and give businesses the upper hand in the ongoing ‘talent war’.

Take processing invoices as an example. It’s a simple but time-consuming task that can often be derailed by human error. Intelligent software can create efficiencies by reducing the time to completion and eradicate costly mistakes. It can also help to combat issues associated with ‘quiet quitting’ as disengaged employees will have time to focus on the tasks that they find more stimulating.

 

Achieving well-rounded cash visibility

In this period of economic uncertainty, cash is no doubt king and having a rounded view of company finances is crucial. Staying on top of a business’s cash position is tricky and slow if balances are still being drawn by hand. It’s labour intensive, time-consuming and there’s risk of being blindsided by putting valuable time into non-strategic tasks.

Instead, technology that uses artificial intelligence (AI) can provide clarity on current and future cash balances and flows, meaning CFOs can anticipate potential cash flow concerns before they become a problem. Plus, the technology can provide actionable insights into the spending and cash flow trends of a company, and AI can forecast potential hurdles and scenarios ahead of a business in a way that people alone can’t. This means the CFO’s decision-making powers grow and deliver better risk management. For a job based on data, implementing technology like this should feel like a natural progression.

 

The future CFO, now

The recent FTX collapse – rooted in a lack of financial planning – only highlights further that humans, without the right technology solutions, cannot deal with the risk management complexities in the modern era. Interestingly, a Gartner Survey conducted this summer highlighted that 45% of CEOs and CFOs would cut digital investments only as a last resort in difficult economic times. Employees and technology were prioritised over investments in mergers and acquisitions, which highlights CFOs’ recognition of the success of technology in driving efficiencies and protecting margins.

Even within industries less volatile than crypto, the threat of collapse is on the mind of most CFOs as we enter a period of economic downturn. For some, the risk might seem less obvious and, therefore, it’s impossible to accurately mitigate against without the right tools. Consequently, over the coming months, it is technology what will set one CFO apart from the next.

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