IDEAS home Printed from https://ideas.repec.org/a/spr/infosf/v18y2016i6d10.1007_s10796-015-9562-5.html
   My bibliography  Save this article

The value of the CIO in the top management team on performance in the case of information security breaches

Author

Listed:
  • Humayun Zafar

    (Kennesaw State University)

  • Myung S. Ko

    (The University of Texas at San Antonio)

  • Kweku-Muata Osei-Bryson

    (Virginia Commonwealth University)

Abstract

This study investigates whether presence of a CIO in the top management team (TMT) is an important indicator for better management of information, especially when an organization is involved in an information security breach incident. Using Upper Echelons Theory, our study relates the status of the CIO in an organization to organizational performance in the case of information security breaches using Tobin’s q. We argue that when an organization experiences an information security breach, the organization that has the CIO in the TMT can recover any damages or losses from the security breach incident quicker than the organization that does not. We categorize security breach incidents using the confidentiality, integrity, and availability (CIA) triad (Solomon and Chapple 2005), and conclude that having the CIO in the TMT has a significant positive impact on firm performance in the aftermath of security breach incidents. However, the degree of impact on performance varies, depending on the type of security breach.

Suggested Citation

  • Humayun Zafar & Myung S. Ko & Kweku-Muata Osei-Bryson, 2016. "The value of the CIO in the top management team on performance in the case of information security breaches," Information Systems Frontiers, Springer, vol. 18(6), pages 1205-1215, December.
    • Handle: RePEc:spr:infosf:v:18:y:2016:i:6:d:10.1007_s10796-015-9562-5
    DOI: 10.1007/s10796-015-9562-5
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10796-015-9562-5
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s10796-015-9562-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Curtis P. Armstrong & V. Sambamurthy, 1999. "Information Technology Assimilation in Firms: The Influence of Senior Leadership and IT Infrastructures," Information Systems Research, INFORMS, vol. 10(4), pages 304-327, December.
    2. Kuo-chung Chang & Chih-ping Wang, 2011. "Information systems resources and information security," Information Systems Frontiers, Springer, vol. 13(4), pages 579-593, September.
    3. Sean Cleary, 1999. "The Relationship between Firm Investment and Financial Status," Journal of Finance, American Finance Association, vol. 54(2), pages 673-692, April.
    4. Kee H. Chung & Stephen W. Pruitt, 1994. "A Simple Approximation of Tobin's q," Financial Management, Financial Management Association, vol. 23(3), Fall.
    5. Edward I. Altman, 1968. "The Prediction Of Corporate Bankruptcy: A Discriminant Analysis," Journal of Finance, American Finance Association, vol. 23(1), pages 193-194, March.
    6. Anandhi S. Bharadwaj & Sundar G. Bharadwaj & Benn R. Konsynski, 1999. "Information Technology Effects on Firm Performance as Measured by Tobin's q," Management Science, INFORMS, vol. 45(7), pages 1008-1024, July.
    7. Zvi Griliches, 1984. "Market Value, R&D, and Patents," NBER Chapters, in: R&D, Patents, and Productivity, pages 249-252, National Bureau of Economic Research, Inc.
    8. Wernerfelt, Birger & Montgomery, Cynthia A, 1988. "Tobin's q and the Importance of Focus in Firm Performance," American Economic Review, American Economic Association, vol. 78(1), pages 246-250, March.
    9. Myung Ko & Kweku-Muata Osei-Bryson & Carlos Dorantes, 2009. "Investigating the Impact of Publicly Announced Information Security Breaches on Three Performance Indicators of the Breached Firms," Information Resources Management Journal (IRMJ), IGI Global, vol. 22(2), pages 1-21, April.
    10. Anat Hovav & John D'Arcy, 2003. "The Impact of Denial‐of‐Service Attack Announcements on the Market Value of Firms," Risk Management and Insurance Review, American Risk and Insurance Association, vol. 6(2), pages 97-121, September.
    11. Raghunathan, Bhanu & Raghunathan, TS & Tu, Qiang, 1998. "An Empirical Analysis of the Organizational Commitment of Information Systems Executives," Omega, Elsevier, vol. 26(5), pages 569-580, October.
    12. Tobin, James, 1969. "A General Equilibrium Approach to Monetary Theory," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 1(1), pages 15-29, February.
    13. Edward I. Altman, 1968. "Financial Ratios, Discriminant Analysis And The Prediction Of Corporate Bankruptcy," Journal of Finance, American Finance Association, vol. 23(4), pages 589-609, September.
    14. Lewellen, Jonathan, 2004. "Predicting returns with financial ratios," Journal of Financial Economics, Elsevier, vol. 74(2), pages 209-235, November.
    15. Thorsten Beck & Asli Demirgüç‐Kunt & Vojislav Maksimovic, 2005. "Financial and Legal Constraints to Growth: Does Firm Size Matter?," Journal of Finance, American Finance Association, vol. 60(1), pages 137-177, February.
    16. Perfect, Steven B. & Wiles, Kenneth W., 1994. "Alternative constructions of Tobin's q: An empirical comparison," Journal of Empirical Finance, Elsevier, vol. 1(3-4), pages 313-341, July.
    17. Carol J. Simon & Mary W. Sullivan, 1993. "The Measurement and Determinants of Brand Equity: A Financial Approach," Marketing Science, INFORMS, vol. 12(1), pages 28-52.
    18. Lang, Larry H P & Stulz, Rene M, 1994. "Tobin's q, Corporate Diversification, and Firm Performance," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1248-1280, December.
    19. Yongtae Kim & Michael Lacina & Myung Seok Park, 2008. "Positive and Negative Information Transfers from Management Forecasts," Journal of Accounting Research, Wiley Blackwell, vol. 46(4), pages 885-908, September.
    20. David S. Preston & Elena Karahanna, 2009. "Antecedents of IS Strategic Alignment: A Nomological Network," Information Systems Research, INFORMS, vol. 20(2), pages 159-179, June.
    21. Humayun Zafar & Myung Ko & Kweku-Muata Osei-Bryson, 2012. "Financial Impact of Information Security Breaches on Breached Firms and their Non-Breached Competitors," Information Resources Management Journal (IRMJ), IGI Global, vol. 25(1), pages 21-37, January.
    22. Barber, Brad M. & Lyon, John D., 1996. "Detecting abnormal operating performance: The empirical power and specification of test statistics," Journal of Financial Economics, Elsevier, vol. 41(3), pages 359-399, July.
    23. Kearns, Grover S., 2006. "The effect of top management support of SISP on strategic IS management: insights from the US electric power industry," Omega, Elsevier, vol. 34(3), pages 236-253, June.
    24. Villalonga, Belen, 2004. "Intangible resources, Tobin's q, and sustainability of performance differences," Journal of Economic Behavior & Organization, Elsevier, vol. 54(2), pages 205-230, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gianfranco Walsh & Edward Shiu & Louise Hassan & Patrick Hille & Ikuo Takahashi, 2019. "Fear of Online Consumer Identity Theft: Cross-Country Application and Short Scale Development," Information Systems Frontiers, Springer, vol. 21(6), pages 1251-1264, December.
    2. Smith, Thomas & Tadesse, Amanuel F. & Vincent, Nishani Edirisinghe, 2021. "The impact of CIO characteristics on data breaches," International Journal of Accounting Information Systems, Elsevier, vol. 43(C).
    3. David M. Goldberg & Jason K. Deane & Terry R. Rakes & Loren Paul Rees, 2022. "3D Printing Technology and the Market Value of the Firm," Information Systems Frontiers, Springer, vol. 24(4), pages 1379-1392, August.
    4. Rajan, Rishabh & Rana, Nripendra P. & Parameswar, Nakul & Dhir, Sanjay & Sushil, & Dwivedi, Yogesh K., 2021. "Developing a modified total interpretive structural model (M-TISM) for organizational strategic cybersecurity management," Technological Forecasting and Social Change, Elsevier, vol. 170(C).
    5. Feng, Cecilia (Qian) & Wang, Tawei, 2019. "Does CIO risk appetite matter? Evidence from information security breach incidents," International Journal of Accounting Information Systems, Elsevier, vol. 32(C), pages 59-75.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Anandhi S. Bharadwaj & Sundar G. Bharadwaj & Benn R. Konsynski, 1999. "Information Technology Effects on Firm Performance as Measured by Tobin's q," Management Science, INFORMS, vol. 45(7), pages 1008-1024, July.
    2. Niket Jindal & Leigh McAlister, 2015. "The Impacts of Advertising Assets and R&D Assets on Reducing Bankruptcy Risk," Marketing Science, INFORMS, vol. 34(4), pages 555-572, July.
    3. Villalonga, Belen, 2004. "Intangible resources, Tobin's q, and sustainability of performance differences," Journal of Economic Behavior & Organization, Elsevier, vol. 54(2), pages 205-230, June.
    4. Haowen Luo & Ian Liu & Niranjan Tripathy, 2021. "A Study on Firms with Negative Book Value of Equity," International Review of Finance, International Review of Finance Ltd., vol. 21(1), pages 145-182, March.
    5. Patrick Musso & Stefano Schiavo, 2008. "The impact of financial constraints on firm survival and growth," Journal of Evolutionary Economics, Springer, vol. 18(2), pages 135-149, April.
    6. repec:hal:spmain:info:hdl:2441/6119 is not listed on IDEAS
    7. Schauer, Catharina & Elsas, Ralf & Breitkopf, Nikolas, 2019. "A new measure of financial constraints applicable to private and public firms," Journal of Banking & Finance, Elsevier, vol. 101(C), pages 270-295.
    8. Grewal, Rajdeep & Chakravarty, Anindita & Ding, Min & Liechty, John, 2008. "Counting chickens before the eggs hatch: Associating new product development portfolios with shareholder expectations in the pharmaceutical sector," International Journal of Research in Marketing, Elsevier, vol. 25(4), pages 261-272.
    9. Filipe Silva & Carlos Carreira, 2012. "Measuring Firms’ Financial Constraints: A Rough Guide," Notas Económicas, Faculty of Economics, University of Coimbra, issue 36, pages 23-46, December.
    10. Sebastian Steinker & Mario Pesch & Kai Hoberg, 2016. "Inventory management under financial distress: an empirical analysis," International Journal of Production Research, Taylor & Francis Journals, vol. 54(17), pages 5182-5207, September.
    11. Behr, Patrick & Norden, Lars & Noth, Felix, 2013. "Financial constraints of private firms and bank lending behavior," Journal of Banking & Finance, Elsevier, vol. 37(9), pages 3472-3485.
    12. Cannon, Alan R., 2008. "Inventory improvement and financial performance," International Journal of Production Economics, Elsevier, vol. 115(2), pages 581-593, October.
    13. Yuying Shi & Jeremy M. Lim & Barton A. Weitz & Stephen L. France, 2018. "The impact of retail format diversification on retailers’ financial performance," Journal of the Academy of Marketing Science, Springer, vol. 46(1), pages 147-167, January.
    14. Sueyoshi, Toshiyuki & Goto, Mika & Shang, Jennifer, 2009. "Core business concentration vs. corporate diversification in the US electric utility industry: Synergy and deregulation effects," Energy Policy, Elsevier, vol. 37(11), pages 4583-4594, November.
    15. Pindado, Julio & Rodrigues, Luis & de la Torre, Chabela, 2008. "Estimating financial distress likelihood," Journal of Business Research, Elsevier, vol. 61(9), pages 995-1003, September.
    16. Marina A. Oskolkova & Petr A. Parshakov, 2013. "Company intangibles: creation vs absorption," HSE Working papers WP BRP 25/FE/2013, National Research University Higher School of Economics.
    17. Yasser Alhenawi & Martha Stilwell, 2017. "Value creation and the probability of success in merger and acquisition transactions," Review of Quantitative Finance and Accounting, Springer, vol. 49(4), pages 1041-1085, November.
    18. Chen, Sheng-Syan & Wang, Yanzhi, 2012. "Financial constraints and share repurchases," Journal of Financial Economics, Elsevier, vol. 105(2), pages 311-331.
    19. Neil Thomas Bendle & Moeen Naseer Butt, 2018. "The Misuse of Accounting-Based Approximations of Tobin’s q in a World of Market-Based Assets," Marketing Science, INFORMS, vol. 37(3), pages 484-504, May.
    20. Richardson, Vernon J. & Sanchez, Juan Manuel & Setia, Pankaj & Smith, Rodney, 2018. "Determinants and consequences of chief information officer equity incentives," International Journal of Accounting Information Systems, Elsevier, vol. 31(C), pages 37-57.
    21. Kwon, He-Boong & Lee, Jooh, 2019. "Exploring the differential impact of environmental sustainability, operational efficiency, and corporate reputation on market valuation in high-tech-oriented firms," International Journal of Production Economics, Elsevier, vol. 211(C), pages 1-14.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:infosf:v:18:y:2016:i:6:d:10.1007_s10796-015-9562-5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.