Painful Disclosures

The average stock prices of six companies that had disclosed an information security breach between February 2005 and June 2006 fell by five percent within a month of the disclosure and remained as much as 8.5 percent below predisclosure levels for nearly a year. That damage compounds any harm done to the organization's reputation, not to mention regulatory penalties that have reached as much as $15 million, according to a research study by Enterprise Management Associates (EMA), an IT management consulting firm.

Read an executive summary of the EMA paper, The Security of Information: A Strategic Approach to Current Topics and Trends.