Sen. Collins’ bipartisan bill requires publicly traded companies disclose cybersecurity efforts

U.S. Sen. Susan Collins (R-ME) is the lead original cosponsor of bipartisan legislation that would increase transparency in the oversight of cybersecurity risks at publicly traded companies.

“As cyberattacks become increasingly common, Congress must take action to better protect Americans from hackers attempting to steal sensitive data and personal information,” Sen. Collins said on Monday.

The Cybersecurity Disclosure Act of 2019, S. 592, sponsored on Feb. 28 by U.S. Sen. Jack Reed (D-RI), would better protect customers, increase transparency for investors and certify that public companies are prioritizing cybersecurity and data privacy, the lawmaker said.

“This bipartisan bill strengthens our nation’s cybersecurity by requiring companies to disclose to the public the basic steps they are taking to prevent cyberattacks,” she added.

S. 592 would require publicly traded companies to include information in their Securities and Exchange Commission disclosures to investors on whether any member of the company’s board of directors is a cybersecurity expert, according to a summary of the bill provided by Sen. Collins’ office.

If no member of the board is a cybersecurity expert, then S. 592 would require the company to explain why such a position isn’t necessary.

The legislation does not require companies to take any actions other than to provide this disclosure, according to Collins.

The senator cited statistics from both the Identity Theft Resource Center and Deloitte, showing, respectively, increasing numbers of cyberattacks across numerous industries in the United States, as well as the majority of financial institutions naming cybersecurity as one of the top three risks expected to rise in importance for their businesses during the next two years.

S. 592 already has gained the support of consumer advocates, investors and securities law experts, according to Sen. Collins, including the North American Securities Administrators Association, the Council of Institutional Investors, the National Association of State Treasurers, the California Public Employees’ Retirement System and the Consumer Federation of America, among others.

The proposal has been referred for consideration to the U.S. Senate Banking, Housing, and Urban Affairs Committee.