Drafting Compliance Episode 1

“As part of the great resignation of 2021, we’ve seen an increasingly fragmented view of intellectual property on the part of departing employees. Businesses can reduce the substantial risk associated with data exfiltration of trade secrets, regulated data and other sensitive data by deploying and monitoring DLP across the enterprise, including remote endpoints.” — IEEE Senior Member Kayne McGladrey

What’s needed is “an effective provisioning and de-provisioning system that defines rules for what users can do with data and provides quick auditing of who granted access to the data. There needs to be training around the approval process for granting and revoking access to data; otherwise, organizations risk compliance fatigue and start rubber-stamping all the access requests.”

Despite this guidance mandating only four disclosures (identifying and managing risks, disclosing material breaches, board oversight, and management’s role), over 40% of the 2,100+ 10-K filings I’ve reviewed between January 1 and March 11, 2024 disclosed eleven distinct topics.

Companies are disclosing more information than required in their 10-K filings for various reasons. One is that they lack a broad consensus how much detail to disclose in Section 1C. The recent civil litigation of SEC vs. Tim Brown and SolarWinds (case 1:23-cv-09518 in the Southern District of New York) significantly influences the disclosure requirements.

“The effectiveness of AI solutions this year can be measured via the time-to-discovery metric, which measures how long it takes an organization to detect a breach,” says Kayne McGladrey (@kaynemcgladrey), CISO, Pensar Development. “Reducing time to discovery can be achieved through AI’s tenacity, which doesn’t need holidays, coffee breaks, or sleep, which is unlike Tier 1 security operations center analysts who also get bored reading endless log files and alerts.”