Should you disclose a data breach via social media? Evidence from US listed companies

Pierangelo Rosati, Peter Deeney, Mark Cummins, Lisa van der Werff, Theo Lynn

Research output: Contribution to conferenceProceedingpeer-review

5 Citations (Scopus)

Abstract

Data breaches represent one of the main concerns for executives across all sectors. Data breaches open a period of crisis for the affected firm and require them to disclose complex information to a variety of stakeholders in a timely and proper manner. This paper investigates the relationship between social media disclosure of a data breach and its cost, as proxied by the response of the affected firm’s stock price. Using an event study methodology on a sample of 32 data breaches from 29 US publicly-traded firms from 2011 to 2014, we find that social media disclosure exacerbates the negative stock price’s response to the announcement. However, such a negative association is contingent on firm’s visibility on traditional media with social media disclosure having a beneficial effect for low-visibility companies.

Original languageEnglish
Pages4772-4781
Number of pages10
Publication statusPublished - 6 Jan 2018
Event51st Annual Hawaii International Conference on System Sciences, HICSS 2018 - Big Island, United States
Duration: 2 Jan 20186 Jan 2018

Conference

Conference51st Annual Hawaii International Conference on System Sciences, HICSS 2018
Country/TerritoryUnited States
CityBig Island
Period2/01/186/01/18

Funding

The research work described in this paper was supported by the Irish Centre for Cloud Computing and Commerce, an Irish National Technology Centre funded by Enterprise Ireland and the Irish Industrial Development Authority.

Keywords

  • information security and privacy
  • crisis communication
  • cybersecurity
  • data breach
  • social media
  • stock market

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