For small and medium business owners who are thinking about selling, the recent increases in the capital profit tax (CGT) announced in the budget represent new challenges.
According to Ed Bartlet, CEO of the pioneering compliance provider, one of the most important risks that threaten business evaluation during due care lies in cybersecurity and compliance standards.
“Cyber security and compliance have become very important to maintain and glorify the value of business,” Bartlet explains. “Buyers and investors are now more cautious than ever, and the bad security administration can lead to certificates like ISO 27001 to significantly eroding value or even completely obstructing deals.”
In light of the scene of extremist deals, owners of small and medium -sized companies must be proactive in addressing cybersecurity risks, which are increasingly examined as part of the due care operations. Investors are no longer satisfied with the treatment of cybersecurity gaps after the deal; These concerns are now decisive to deals.
Cyber security: the hidden deal
Cyber security vaccinations can have long -term effects on evaluation, especially in sectors such as technology, financing, health care and retail trade. The average cost of cyberspace on small and medium -sized companies in the United Kingdom is about 75,000 pounds, with greater risk in high -value sectors.
Costs of electronic attacks for sectors according to the IBM report for the 2023 data breach cost:
- Finance and insurance: more than 4 million pounds per accident.
- Healthcare: About 3.2 million pounds.
- Retail and e -commerce: about 2 million pounds.
- Technology and software: approximately 2.5 million pounds per breach.
Bartlet warns that such violations not only affect profitability and processes, but also distort the company’s reputation, making it less attractive to potential buyers.
“Investors consider neglecting cybersecurity a responsibility.”. “Private stock companies and commercial buyers alike have become increasingly unwilling to overlook the security palaces. For some, this has become a criterion for completing the deal.
Certificates to enhance the evaluation
Completion of recognized standards such as ISO 27001 or Cyber Essentials can significantly enhance business evaluation. Research indicates that the ISO certificate companies often get 10-20% higher assessments of their uncompromising counterparts, reflecting the confidence that these certificates inspire between buyers.
“Cyber security is not limited to protection; Bartlet confirms that the matter is related to showing flexibility and willingness.” The companies that receive these certificates proactively send a clear indication of their commitment to strong security practices, simplifying the process of due care and attracting distinguished assessments. ”
Steps to maintain value
To help owners of small and medium companies prepare for sale, Bartlet is recommended for the following:
- Cyber security audits: Discover weaknesses before potential buyers do.
- Get ISO Certificate: Show internationally recognized security practices.
- Adoption of Internet Basics: Create basic protection methods for small budgets.
- Employee training: Reducing the risks caused by human error.
- Promoting material security: enhancing the controls of access to important information technology systems.
- Consult the experts: Design your cyber security strategy to suit business needs and investors.
Adapting to the new tax scene
In the post -CGT era, cybersecurity and compliance from operational interests turned to strategic necessities. For owners of small and medium -sized companies who plan for sale, investing in these areas is not only recommended; it is necessary.
Bartlett concludes that “the risks have risen.” “To maintain and enhance the value, companies must adapt quickly to meet the increasing expectations of buyers and investors today. Cyber security and compliance are no longer optional, but have become important.