City Research Online

Abstract

Businesses constantly face a variety of crises which could result in the loss of financial resources and good reputation: human error, crime, employees’ unlawful behaviour, technical failure and the like. These are all categorised in one word: “risk”. With the rise of cyberspace, new risks have come into existence and interest in this issue is significant. With regard to risk management, the financial industry, a core business that no company can do without, is likely to be one-step ahead of other industries. Thus, in this thesis I have chosen to examine and compare the management of cyber risk in the financial industries of Japan and the UK.

Some types of risk, such as human error and technical failure, are likely to occur accidentally, but it is necessary to analyse others, particularly crime and unlawful behaviour. Through the comprehension of risk types, we can understand how each risk management method works.

As for the suggested risk management methods, the thesis begins by discussing how criminal and civil law and regulation deal with risk. However, law and regulation are not the perfect solutions for businesses. An alternative is insurance. Since the 1980s, insurance industries in Japan and the UK have developed products to deal with computer crime or cyber risk. The most popular method is to strengthen computer security. It is also crucial to resuscitate the morality and ethics of employees and firms themselves. The development and spread of the concept of operational risk worldwide is to encourage firms to deal with the situation. Outsourcing, Alternative Risk Transfer, Alternative Dispute Resolution and other new technology are also discussed as risk management methods.

To prove that cyber risk is avoidable by the application of these methods and theories, there are two issues which need to be discussed: cyber money laundering and account aggregation services.

It is essential to be aware that cyber risk is unique for each individual firm and industry, so there is no single risk management method against cyber risk. Therefore, it is important to ascertain which methods are practical for each firm and combine them like a patchwork.

Publication Type:	Thesis (Doctoral)
Subjects:	H Social Sciences > HG Finance Q Science > QA Mathematics > QA75 Electronic computers. Computer science
Departments:	Bayes Business School > Bayes Business School Doctoral Theses Bayes Business School > Finance Doctoral Theses

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