Understanding the EU Digital Operational Resilience Act (DORA)
Because the financial industry is extremely complex and ever-evolving, having an iron-clad cybersecurity strategy is of the utmost importance. To tackle this, the European Union (EU) recently introduced the Digital Operational Resilience Act (DORA), which aims to enhance the digital resilience of financial institutions and their service providers. With DORA, organizations must adhere to rigorous standards in managing their information and communication technology (ICT) services. To prepare for DORA, one must first understand what it entails, its critical components, and what financial institutions need to do to ensure compliance and enhance their cybersecurity programs.
What is DORA?
The Digital Operational Resilience Act (DORA) is a comprehensive regulatory framework designed to ensure that financial institutions can withstand, respond to, and recover from all types of ICT-related disruptions and threats. Financial institutions will be required to comply with its mandates by January 17, 2025.
Who is affected by DORA?
DORA targets financial institutions operating within the European Economic Area (EEA), as well as their critical and non-critical ICT third-party service providers. According to Article 2(1), these third-party providers are defined as undertakings offering ICT services, including cloud service providers, data analytics firms, and cybersecurity vendors.
Objectives of DORA
The core objective of DORA is to bolster the digital operational resilience of financial entities. This is achieved through five key areas:
- ICT Risk Management and Governance
Within the parameters of DORA, financial institutions must adopt robust ICT risk management frameworks. These frameworks should include procedures for continuous risk assessments and business impact analyses. By identifying potential vulnerabilities and assessing their impact, institutions can better prepare for and mitigate disruptions.
Performing ongoing risk assessments is essential when looking to maintain operational resilience. By regularly evaluating ICT systems, financial institutions can identify potential risks and update their mitigation strategies when it matters most.
Similarly, conducting business impact analyses helps institutions understand the potential consequences of ICT disruptions. This knowledge allows them to prioritize resources and focus on safeguarding critical operations.
- Incident Response and Reporting
Financial institutions must have systems in place for monitoring, analyzing, and reporting ICT incidents. These systems should be capable of detecting threats in real time and providing insights into their nature and potential impact.
DORA mandates three distinct reports for ICT incidents:
- Initial report notifying authorities of the incident.
- Progress report detailing steps taken to resolve the incident.
- A final report analyzing the root causes and lessons learned.
- Digital Operational Resilience Testing
Regular testing of ICT systems is necessary to ensure their resilience. Under DORA, financial institutions must conduct routine comprehensive tests to identify and assess the vulnerabilities in their security measures. Results from these resilience tests should be reported to the relevant competent authorities. This guarantees accountability and gives institutions the opportunity to continuously improve their ICT security practices.
- Third-Party Risk Management
Financial institutions must take an active role in negotiating contractual terms with critical and non-critical ICT service providers. They are not permitted to contract with providers who do not meet DORA's requirements. Note that critical and non-critical ICT service providers to financial institutions have different requirements in order to comply with DORA. For instance, Cofense is a non-critical ICT service provider as Cofense provides ICT services listed in (Article 3(19)) but does not meet the criteria to classify as a critical ICT Provider under Article 31(2)).
Institutions must map their third-party ICT dependencies to understand their exposure to risks. This involves identifying all third-party providers and assessing their compliance with DORA.
- Information and Intelligence Sharing
DORA encourages financial institutions to share information about threats, risks, and vulnerabilities. This collaborative approach helps institutions stay informed about emerging threats and adopt effective countermeasures.
Enhancing Email Security to comply with DORA
Cofense specializes in email security solutions designed to detect, identify, and eliminate email security threats in real time. By safeguarding email communications, Cofense solutions help institutions protect their critical data and operations.
Here are a few of the ways that our products and services can help ensure your email security strategy is resilient:
- Employee Training and Awareness
- Cofense provides training programs to help employees recognize phishing attempts and other email-based threats. Empowering teams to take an active role in maintaining cybersecurity resilience is a key aspect of DORA compliance.
- Comprehensive Reporting and Analytics
- Cofense reporting and analytics tools facilitate incident response and management. Financial institutions can monitor email threats, document incidents, and generate reports that fulfill DORA's reporting requirements.
- Risk Management and Mitigation
- Cofense solutions are designed to mitigate risk by detecting, identifying, and eliminating email security threats in real time. This enables organizations to gain critical insights into system vulnerabilities, enhancing the likelihood of early discovery and remediation of future threats.
Cofense’s ICT Service Provider Compliance
Cofense is committed to meeting DORA's requirements for non-critical ICT service providers by January 2025. We are continuously enhancing our solutions to ensure full compliance and support our clients' regulatory needs.
Navigating DORA's requirements is a complex but essential task for financial institutions seeking to enhance their operational resilience. By adopting comprehensive risk management frameworks, conducting regular resilience tests, and actively managing third-party risks, institutions can comply with DORA and protect their operations.
Cofense offers robust email security solutions that align with DORA's mandates. Our expertise in detecting and mitigating email threats, combined with our comprehensive reporting tools, ensures that financial institutions can meet their regulatory obligations and maintain a strong cybersecurity posture.
Connect with Cofense today to learn more about our solutions and how we can support your compliance efforts.