SEC Cyber Regulations Checklist: 7 Steps to Prepare Your Organization

In 2023, the U.S. Securities and Exchange Commission (SEC) introduced new rules aimed at standardizing how organizations disclose cybersecurity incidents and outline their risk management, strategy, and governance practices. Despite these clear guidelines, many companies are struggling to align their processes with the requirements.

To help your organization meet these requirements and maintain compliance, here’s a checklist of seven actionable steps you can take right now:

1. Identify What Matters Most

One of the most significant components of the SEC’s cyber regulations is disclosing material cyber incidents. To do this effectively, your organization must first define what constitutes material information.

Ask yourself:

• What systems, data, or processes, if disrupted, could have a significant impact on business operations, finances, or reputation?
• How are you currently tracking and classifying this information?

Collaborate with your legal, compliance, and IT teams to identify and categorize sensitive assets. Having a clear picture of your material information is the foundation for compliance.

2. Master the 8-K Filing Requirements

The SEC’s 8-K filing requirements mandate that publicly traded companies disclose material cyber incidents within four business days. Failing to meet this timeline can result in penalties and reputational damage.

To prepare:

• Familiarize yourself with the disclosure requirements and timelines.
• Create workflows that enable your organization to assess incidents quickly, determine materiality, and craft accurate disclosures.
• Coordinate with your legal team to ensure your reporting aligns with SEC standards.

Timely and accurate reporting not only keeps you compliant but also demonstrates your organization’s commitment to transparency.

3. Fortify Your Incident Response Plan

An incident response program (IRP) is your playbook for addressing cyber incidents. However, many organizations realize too late that their IRP is outdated or incomplete.

Update your IRP to:

• Include procedures for assessing the materiality of incidents.
• Ensure it integrates legal and compliance workflows for SEC reporting.
• Align your response timelines with the SEC’s disclosure requirements.

Run tabletop exercises to test your team’s readiness. Real-world scenarios will help identify gaps and build confidence in your response strategy.

4. Establish Strong Cybersecurity Governance

Cybersecurity governance is about establishing oversight and accountability. The SEC expects organizations to demonstrate that cybersecurity is a priority at every level.

Key steps include:

• Assigning clear roles and responsibilities for cybersecurity oversight.
• Involving the board in cybersecurity discussions and ensuring they are educated about cyber risks.
• Establishing policies that tie cybersecurity goals to business outcomes.

When governance is embedded in your culture, it not only satisfies regulatory requirements but also strengthens your overall security posture.

5. Proactively Test Your Defenses

The SEC’s focus on cyber resilience means organizations must be proactive in identifying vulnerabilities. Regular audits and testing are critical for staying ahead of threats.

Here’s how to approach it:

• Conduct penetration testing and vulnerability scans on a routine basis.
• Audit third-party vendors to ensure they meet your cybersecurity standards.
• Use the findings to prioritize remediation efforts and bolster your defenses.

A proactive approach not only strengthens your security but also shows regulators you’re serious about reducing risk.

6. Build a Culture of Cybersecurity Awareness

Regulations and technical safeguards only go so far if your employees aren’t on board. A strong cybersecurity culture can act as your first line of defense.

Steps to foster this include:

• Regular training that goes beyond compliance to make cybersecurity relatable and actionable for employees.
• Clear communication of policies and expectations.
• Encouraging employees to report suspicious activities without fear of blame.

Remember, cybersecurity is everyone’s responsibility, and a culture of vigilance is key to staying ahead of threats.

7. Stay Agile and Prepared for Change

The cyber regulatory landscape is constantly evolving. Staying compliant today doesn’t guarantee you’ll remain compliant tomorrow.

To stay ahead:

• Monitor updates to SEC regulations and other industry standards.
• Build flexibility into your cybersecurity programs so they can adapt to new requirements.
• Partner with trusted cybersecurity advisors who can help you navigate changes as they arise.

Preparation is not a one-time task—it’s an ongoing commitment. Being adaptable will keep your organization resilient in the face of both regulatory changes and emerging threats.

Final Thoughts

The SEC’s cyber regulations are more than just a compliance exercise—they’re an opportunity to build trust with stakeholders, customers, and investors. By following this checklist, your organization can not only meet regulatory requirements but also strengthen its overall cybersecurity posture.

Remember: the cost of preparation is always less than the cost of a breach—or the penalties for non-compliance.

If you’re unsure where to begin or need help aligning your cybersecurity strategy with the SEC’s regulations, feel free to reach out. Let’s work together to turn compliance into a competitive advantage.