As cybersecurity threats grow, fragmented reporting of security incidents represents an increasing vulnerability. In response, the Financial Stability Board (FSB) is calling on regulators to pursue harmonized reporting.
In a new report, the FSB said that cyber incident reporting requirements remain fragmented across jurisdictions and between sectors. There are also differences in reporting methodologies, timelines, and in how reports are used.
This is increasingly a concern for financial stability, the FSB said: “This fragmentation could undermine a financial institution’s response and recovery actions, and underscores a need to address constraints in information-sharing among financial authorities and financial institutions.”
With cyber attacks growing rapidly in both “frequency and sophistication,” and with the financial sector becoming increasingly digital and dependent on third-party service providers, the importance of strong cyber defences is increasing too.
Harmonizing reporting would help ensure more effective supervision of cyber risks in the financial sector and bolster financial stability, the FSB said.
To that end, it recommended measures for improving harmonization, such as establishing best practices, standardizing terminology and information sharing.
The FSB said it will develop a detailed plan for this work by the end of 2021.