New SEC Regulations Your Company Must Stay Informed About
May 23, 2024
The Security and Exchange Commission (SEC) has implemented new regulations concerning the disclosure of cybersecurity incidents. Your company must understand these changes and how they relate to your business.
Recent Regulations Affecting Cybersecurity in Public Companies
In 2022, the SEC proposed rules mandating the disclosure of "material" cybersecurity incidents by any company filing documents with the SEC. A "material" incident denotes a scenario where unauthorized access to personal information is feasible. These rules officially went into effect in December of 2023.
The underlying objective behind the new regulations is to procure consistent, comparable, and informative disclosures. These disclosures will enable investors to evaluate the vulnerability of registrants to significant cybersecurity incidents and their capability to detect and mitigate these risks proficiently.
Registrants must disclose any "material" incident using Form 8-K Item 1.05, typically within four days of discovery. However, if immediate disclosure threatens national security or public safety, as determined by the U.S. Attorney General, the disclosure may be delayed. In such instances, additional requests for delay may be considered by the Commission.
Moreover, companies must furnish annual disclosures encompassing a summarized account of notable cybersecurity incidents, an outline of their general cybersecurity procedures, and an explanation of oversight by the management and board. They must also assert their ability to ensure accurate cybersecurity reporting and preparedness.
Significance of Compliance with SEC Regulations
Compliance with SEC regulations is paramount for the prosperity of your business, employees, and clientele. While implementing these changes may undoubtedly present complexities, the advantages of improving cybersecurity breach reporting and SEC compliance far outweigh the challenges.
Businesses must reassess their IT Asset Management (ITAM) and IT Asset Disposition (ITAD) processes in light of these updated regulations.
ITAM embodies a framework governing an organization's IT asset management, comprising best practices and processes. On the other hand, ITAD involves determining the proper methods and locations for IT hardware disposal, whether through refurbishment or secure recycling.
Both ITAM and ITAD necessitate meticulous oversight to guarantee data security. Misaligned strategies can lead to:
- Compromised data security
- Non-compliance with regulations
- Data loss
- Expensive legal disputes
These outcomes can adversely affect your business, employees, and customers. Aligning ITAD and ITAM strategies is crucial for the well-being of your company.
Discover More About Maintaining SEC Compliance
Sturgeon is equipped to provide comprehensive guidance and resources to ensure compliance with all regulatory frameworks while enhancing profitability and reducing negative environmental impact.
