SEBI directs regulated entities, exchanges to strengthen cybersecurity measures

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The Securities and Exchange Board of India (SEBI) in its latest circular has released an advisory directing regulated entities like stock exchanges, depositories, mutual funds and other financial sector organisations to strengthen their cybersecurity measures.

The market regulator emphasised that in light of the interconnectedness and interdependency of the financial entities, "the cyber risk of any given entity is no longer limited to the entity’s owned or controlled systems, networks and assets".

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Encouraging market participants to ramp up their cybersecurity measures, the regulator marked out that the sophistication and persistence of the cyber-security threats have increased. It pointed out that regulated entities cannot afford to rely only on traditional approaches to risk management and governance that worked in the past but may not be comprehensive or agile anymore in an environment where the pace of technological change is redefining public and private enterprise.

The circular focuses on a number of issues including the role and responsibility of the Chief Information Security Officer, the measures being adopted by regulated entities to fend off cybersecurity attacks, the execution of security audits and vulnerability testing of operating systems and applications, and measures for data protection and data breach.