According to a new report from Yahoo Finance, the Bank of England is calling on new regulations in regards to the operational risks associated with outsourced cloud computing.
The global economy is currently in the middle of an on-going digital transformation, as businesses shift common business practices to the digital world to meet the new demands of customers. However, the sensitivity of certain data has some executive leaders anxious about storing information in popular cloud-storage data centers (AWS,Google (News - Alert) Cloud, etc.), especially in wake of the rise of cybercrime across the globe.
The Bank of England released an official statement addressing the need for stronger rules to protect customers and business operations from potential third-party risks:
"Regulated firms will continue to have primary responsibility for managing risks stemming from their outsourcing and third-party dependencies.However, additional policy measures, some requiring legislative change, are likely to be needed to mitigate the financial stability risks stemming from concentration in the provision of some third-party services."
Representatives with BoE suggest having certain public cloud providers be designated as “critical”, and would require providers with this status to partake in rigorous testing to ensure standards are consistently met.
On the surface, this idea seems to be a logical step forward in addressing the serious threats involved with cloud storage. The modern economy is ready to make the switch to the cloud, but will only be successful if consumers and business leaders feel confident in managing massive amounts of valuable data. Cloud technology is here to stay, but users need to be realistic about the risks associated with improper management.
Edited by Maurice Nagle