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Do Data Breaches Affect Our Beliefs? — Investigating Reputation Risk in Social Media



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Journal of Information Systems Security
Volume 13, Number 2 (2017)
Pages 97116
ISSN 1551-0123 (Print)
ISSN 1551-0808 (Online)
Griselda Sinanaj — University of Göttingen, Germany
Frederick Beyer — University of Göttingen, Germany
Information Institute Publishing, Washington DC, USA




Data and privacy breaches have turned into a constant threat for every organization and continue to increase from year to year. In research and practice, one of the fundamental problems regarding data breach incidents is the limited knowledge on their economic and organizational consequences. Several studies have shown that firms having experienced data breach events suffer substantial losses in their market value. Data breaches can also damage corporate reputation, yet this aspect is still understudied and the empirical evidence not sufficient. To fill this knowledge gap, this study investigates the impact of data breaches on social media with the scope of measuring the repercussion on reputation. As hypothesized, data breaches have an adverse impact on corporate reputation. Furthermore, we found that the impact of data breaches on reputation depends on the news media exposure of the breach incident and on the breach history of each firm. Specifically, data breach events announced through news media cause a stronger negative impact on reputation than data breach incidents not publicized in news media. In addition, companies which have already experienced in the past data breach events suffer greater reputational losses than firms who experience for the first time a data breach incident.




Data Breaches, Corporate Reputation, Social Media, Drivers, Sentiment Analysis




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