How to Effectively Protect Your ESG Data from Cyberattacks

Effectively Protect Your ESG Data: Companies must not only accurately collect their ESG data (Environmental, Social, Governance), but also protect it from cyberattacks. Digitalization increases the risk of data breaches. According to IBM’s 2023 Cost of a Data Breach Report, the average global cost of a data breach reached $4.45 million, with regulatory fines and reputational damage rising sharply for organizations handling sensitive ESG data (IBM Data Breach Report 2023). With these five measures, you can secure your data and comply with legal requirements such as the GDPR and the CSRD:

• Data Encryption: Use TLS, AES-256, and end-to-end encryption to protect data during transmission and storage. The National Institute of Standards and Technology (NIST) recommends AES-256 as a gold standard for data at rest (NIST SP 800-57).
• Access Controls: Implement role-based access rights (RBAC) and multi-factor authentication (MFA) to prevent unauthorized access. According to Microsoft, MFA can block over 99.9% of account compromise attacks (Microsoft Security Blog).
• Employee Training: Regularly train your teams to strengthen security awareness and IT skills. The World Economic Forum highlights that 95% of cybersecurity issues can be traced to human error (WEF Cybersecurity Predictions).
• Monitoring Systems: Use SIEM systems to detect suspicious activities in real time and trigger automated responses.
• Security Audits: Conduct regular audits to identify vulnerabilities and demonstrate regulatory compliance.

These measures not only help you meet legal requirements but also strengthen stakeholder trust. Start by analyzing your existing security architecture and setting clear priorities. For example, a 2022 Deloitte survey found that 68% of investors consider robust ESG data security a key factor in their decision-making (Deloitte ESG Data Security).

With the CSRD, ESG data is now systematically subject to mandatory reporting—and thus also to audits. Their integrity and security are now a key focus for corporate management. According to EFRAG, cyber risks are explicitly considered part of governance disclosure in sustainability reports (EFRAG Guidance).

Consider Double Materiality

Cybersecurity is not just a technical obligation, but a central governance topic within the framework of double materiality. The integrity and availability of ESG data is essential both from a financial perspective (e.g., reputational risks, fines) and from a stakeholder perspective (e.g., impact on the environment and human rights). The European Commission’s guidance on double materiality emphasizes that cyber incidents affecting ESG data can have both direct financial consequences and broader societal impacts (European Commission: Double Materiality).

The CSRD requires companies to reflect both perspectives in their reporting—including risks from cyber threats. A robust security concept for ESG data therefore supports not only the IT department, but is a fundamental part of sustainability and risk management.

Big Green Data: How your data strategy can protect the environment

1. Data Encryption Methods

To securely protect ESG data, a combination of encryption during transmission (e.g., TLS) and at rest (e.g., AES-256) is essential. This is complemented by asymmetric methods such as RSA or ECC, as well as end-to-end encryption. These measures play a key role in complying with GDPR and CSRD requirements and strengthen the trust of investors and customers in ESG reports. Particularly sensitive ESG data includes CO₂ emissions according to the GHG Protocol, supply chain due diligence information, diversity and social metrics, emission reduction targets, and climate risk data. In 2023, the GHG Protocol was referenced by over 90% of Fortune 500 companies in their sustainability disclosures (GreenBiz: GHG Protocol).

A central key management system using role-based access rights ensures transparency and secures data integrity. After encryption, a clearly defined access management system determines who is authorized to decrypt the data.

2. User Access Controls

In addition to data encryption, strict access management ensures the protection of your ESG data. By applying the principle of least privilege, access to ESG data is restricted to only what is absolutely necessary. Role-based access controls (RBAC) enable centralized management of permissions, while multi-factor authentication (MFA) requires an additional proof of identity beyond just a password. The Center for Internet Security recommends regular reviews of access rights as a critical control (CIS Controls).

Other measures such as time-limited access rights, regular account reviews, and comprehensive logging of access ensure that deactivated accounts remain secure, activities are traceable, and all compliance requirements are met.

Since ESG data is often collected in specialized departments—such as procurement, HR, or sustainability management—close coordination with the IT department is essential. Security responsibility must be shared to avoid silo solutions and security gaps.

3. Employee Training on IT Security

Targeted training is, alongside technical measures, a key building block for strengthening cyber resilience. By establishing regular training intervals, for example every three months, your team stays up to date. Such regular training sessions and hands-on exercises impart important knowledge about data protection and IT security protocols for ESG data. They help raise awareness of current threats and reinforce internal policies. According to a 2023 Proofpoint report, organizations with quarterly security awareness training saw 60% fewer phishing-related incidents (Proofpoint State of the Phish).

4. Security Systems for Monitoring

After targeted training, technical monitoring is the next line of defense. It protects ESG data from cyberattacks in real time and provides evidence for investors and regulators. A SIEM system (Security Information and Event Management) plays a central role: it collects and analyzes logs from firewalls, IDS, and endpoint protection solutions to instantly identify suspicious activities—such as unusual access to emissions or supply chain data. Gartner notes that integrating SIEM with AI-driven analytics can reduce incident response time by up to 70% (Gartner AI in Security Operations).

A SIEM system should offer the following features:

• Real-time monitoring: Suspicious access patterns are detected immediately.
• AI-powered behavioral analysis: Identifies potential insider threats.
• Automated countermeasures: Actions such as access blocks or emergency backups are triggered automatically.

By integrating SIEM with firewalls, IDS, and endpoint protection into a central dashboard, you always have an overview and can react quickly.

Important tip: Log all access to ESG data for at least one year to meet audit and compliance requirements.

Additionally, it is advisable to set up an internal or external SOC (Security Operations Center) that provides 24/7 monitoring and defines clear escalation processes. The next step is the security audit as the final component.

5. Security Audit Process

After continuous monitoring, a formalized security audit follows, systematically uncovering vulnerabilities and assessing the effectiveness of data protection measures for ESG data. A well-structured audit provides not only technical insights but also crucial evidence of compliance with regulations such as GDPR and CSRD. The UK’s National Cyber Security Centre recommends annual audits, with critical vulnerabilities remediated within 48 hours (NCSC Cyber Essentials).

The security audit consists of four phases:

1. Scope Definition
   • Define which ESG data systems will be audited
   • Identify relevant compliance requirements
   • Select appropriate audit methods
2. Execution
   • Conduct technical security tests
   • Review implemented controls from measures 1 to 4
   • Analyze SIEM logs and access records
3. Results Analysis
   • Document all identified vulnerabilities
   • Assess risks based on their severity
   • Set priorities for action
4. Follow-up
   • Create an action plan to address vulnerabilities
   • Assign responsibilities
   • Plan and schedule follow-up audits

A real-world example: An annual comprehensive audit, supplemented by quarterly interim reviews, has proven effective. Critical vulnerabilities should be resolved within a maximum of 48 hours (NCSC Cyber Essentials).

By integrating audit results into the continuous improvement process, the security of ESG data is strengthened over the long term. At the same time, documented audits serve as proof of regulatory compliance to stakeholders.

To sustainably protect ESG data and ensure audit-proof documentation, relevant measures should also be anchored in the internal control system (ICS)—especially for publicly listed or CSRD-obligated companies. This strategically links security and governance.

Implementation Overview

The following three phases put the five main measures into practice:

The Three Phases:

1. Preparation Phase
   • Analyze the existing IT and data infrastructure
   • Identify relevant ESG data and prioritize according to criticality, available resources, and legal requirements
2. Implementation Phase
   • Introduce encryption and access controls
   • Train employees
   • Adjust monitoring mechanisms
3. Optimization Phase
   • Adjustments based on initial audit results and performance reviews
   • Regular feedback sessions with departments for continuous improvement

The effort and costs depend on company size and existing security levels. Investment and operating costs are mainly influenced by IT experts, security analysts, and training coordinators. According to ISACA, organizations that align with ISO 27001 can reduce the likelihood of a major breach by up to 50% (ISACA: ISO 27001 Benefits).

Follow the requirements of ISO 27001 and GDPR, and integrate the measures directly into your ESG reporting.

Small and medium-sized enterprises (SMEs) should also prepare: While less stringent reporting obligations currently apply to them, many are already indirectly affected as suppliers. Securing ESG data today builds trust with business partners—and ensures regulatory readiness for tomorrow. The European Union Agency for Cybersecurity (ENISA) provides tailored cybersecurity guidance for SMEs managing ESG data (ENISA: CSRD and SMEs).

Next Steps

Here are three clear steps for further implementation:

1. Phase 1: Record your existing sensitive ESG data and current security architecture.
2. Phase 2: Assemble a project team, set milestones, and conduct regular progress reviews.
3. Phase 3: Document the integration, test effectiveness, and provide targeted employee training.

These measures support transparent ESG reporting for your stakeholders.

FAQs: How Can You Protect ESG Data from Cyberattacks?

What are ESG Data?

Answer: ESG data refers to information about environmental, social, and governance topics—such as CO₂ emissions, climate targets, diversity metrics, or supply chain data.
Result: They are fundamental for sustainability reports and regulatory disclosures under the CSRD.

Why is Protecting ESG Data So Important?

Answer: ESG data is not only sensitive but will also be subject to mandatory audits in the future.
Evidence: The CSRD and GDPR require their integrity, confidentiality, and availability.
Result: Successful protection safeguards reputation, ESG ratings, and investor trust.

Which Laws Govern the Protection of ESG Data?

Answer:

• CSRD – requires comprehensive sustainability reporting.
• GDPR – protects personal ESG data, e.g., from HR or supply chains.
  Result: Companies must demonstrate technical and organizational measures.

Which Measures Specifically Protect ESG Data?

Answer:

• Encryption (TLS, AES-256, E2EE)
• Access Controls (RBAC, MFA, role rights)
• Employee Training (regular, hands-on)
• Monitoring Systems (SIEM, SOC, logs)
• Audits & ICS (regular, documented)
  Result: These measures strengthen resilience and audit capability.

How Does a Security Audit for ESG Data Work?

Answer:

1. Define Scope – What will be audited?
2. Conduct Tests – Check technology and processes
3. Assess Risks – Document vulnerabilities
4. Plan Actions – Assign responsibilities & set deadlines
   Result: Critical gaps are identified and systematically closed.

What Role Does the GDPR Play for ESG Data?

Answer: Data protection is part of good corporate governance—and thus an ESG topic.
Evidence: The GDPR protects human rights, especially for personalized ESG data.
Result: Complying with data protection strengthens both social responsibility and governance.

What Risks Arise from Inadequate Cybersecurity?

Answer:

• Fines (up to €20 million / 4% of revenue)
• Loss of trust among customers and investors
• Reputational damage from data leaks
• ESG ratings may drop
  Result: Weak security becomes costly—both regulatorily and economically.

What Are the Benefits of Strong ESG Data Protection?

Answer:

• Fulfillment of legal obligations
• Credibility with stakeholders
• Competitive advantages through reliable ESG reports
• Reduced attack surface for cyber threats
  Result: ESG data security is investment protection.

Which Companies Are Especially Affected?

Answer:

• Companies with global supply chains
• Financial & insurance companies
• Businesses in the healthcare and technology sectors
  Result: Data-driven industries in particular must secure themselves early.