Title: The effects of the legal environment on cybersecurity

Authors: Kam C. Chan; Barbara Farrell; Patricia Healy; Maria Tan

Addresses: Lubin School of Business, Pace University, Pleasantville, NY, 10570, USA ' Lubin School of Business, Pace University, Pleasantville, NY, 10570, USA ' Lubin School of Business, Pace University, Pleasantville, NY, 10570, USA ' Lubin School of Business, Pace University, Pleasantville, NY, 10570, USA

Abstract: Cybersecurity failure poses a risk to all firms. Cyber attackers exploit vulnerabilities to steal assets and information, jeopardising the victim's ability to deliver products or services. Understanding the ways to strengthen cybersecurity can help mitigate the risk of cybersecurity failures. Examining the effects of a country's legal environment on cybersecurity, this study finds that the strength of cybersecurity is positively associated with the strength of laws in place and the extent of legal enforcement. In addition, we observe stronger cybersecurity in countries with more resources and higher percentages of internet users. This study helps regulators understand the factors affecting cybersecurity. Analysing factors determining cybersecurity allows investors to predict and assess international differences in cybersecurity risks.

Keywords: cybersecurity; legal environment; rule of law; shareholder rights; GDPR.

DOI: 10.1504/IJSS.2023.132731

International Journal of Services and Standards, 2023 Vol.13 No.3/4, pp.147 - 159

Received: 03 Mar 2021
Accepted: 25 Nov 2021
Published online: 09 Aug 2023 *