According to a recent World Economic Report, the Covid-19 pandemic has increased our reliance on the global supply chain, while the Internet has accelerated the digitisation of business processes(1). To remain competitive, manufacturing companies are increasing their reliance on suppliers to help adopt 4IR innovations such as Artificial Intelligence, Machine learning, IoT and Big Data. This has exponentially increased risks from a cybersecurity perspective. As supply chains have become integrated, interconnected and increasingly complex, supply chain cyber-attacks are on the increase as they are very effective. Suppliers are most likely the second or third biggest risk in terms of cybersecurity.
The SolarWinds hack
A supply chain attack targets third-party suppliers who already have access to their customer’s systems. This is easier than trying to hack customer’s systems directly. This is effective as it hides the malware inside trusted software which is then distributed to thousands of customers. A recent example is the SolarWinds hack – one of the largest ever recorded cyber-attacks(2). SolarWinds provides tools for thousands of organisations to monitor their IT networks and infrastructure systems. Early in 2020, hackers used an inadvertently sent out software update to customers that included the hacked code(3). The exploit created a backdoor through which hackers could gain access to customer’s IT systems. Hackers could then access system files, exfiltrate or alter data and impersonate user accounts. The backdoor could also be used to install more malware, allowing them to escalate and maintain their hold on IT systems. The malware went undetected for months. This affected up to 18 000 customers, including critical agencies in the US government. More than 80% of the targets were Fortune 500 companies, i.e. Microsoft, Cisco, Intel and Deloitte.
This was a complex attack and required material resources. Nation-state hackers are believed to have been responsible, i.e. Russia’s Foreign Intelligence Service, known as the SVR. The real danger to enterprises is that once this approach has been used, it is out in ‘the wild’ and can be re-used or modified by other groups with far fewer resources.
Supply chain attacks are only one of the cyber risks from third-party suppliers. Here are a few more to take note of:
• New vendors and technologies are emerging all the time. IoT devices are a major concern as the focus is mass-producing low-cost connected devices, not protecting customers from cybersecurity threats.
• Support staff accessing your systems on-site or remotely with insecure connections or devices. This can introduce malware or open your systems to new vulnerabilities.
• Insecure software development can result in software being installed that can be easily exploited. This is especially risky with Internet-facing systems.
• Improperly trained support staff who neglect to apply basic security configurations.
• Insecure configurations of cloud and or software as a service are also common.
Assessing the risks
Regular risk assessments need to be conducted on third-party providers to address all the potential risks that they can introduce to your organisation. This will identify, assess, measure and monitor any risks associated with the relationship. The next step is to implement mitigating controls to address the risks. Third-party providers need to be effectively managed throughout the whole ‘Vendor Lifecycle’ from selection and on-boarding to off-boarding. Suppliers need to be challenged about their approach to cybersecurity and what security certifications and frameworks they have adopted. If they develop software or are a cloud or SaaS provider, they should have mature, secure development processes and apply cloud security principles(4).
Secure development applies fundamental, sound and secure software development practices based on established best-practice documents from organisations such as BSA, OWASP and SAFECode(5). If they do not have anything in place, they should commit to a prioritised roadmap to improve their cybersecurity posture. Procurement and IT should build a cyber-reputation scorecard and avoid suppliers with a poor record. This will require effective and regular threat intelligence. Threat intelligence is information that helps organisations understand, identify, prevent and respond to security threats(6). Supplier contracts should be updated to address cybersecurity and introduce penalties should breaches be resulting from any negligence.
Targeted cybersecurity training should be conducted for OT and procurement staff. Adopting a best-practice cybersecurity framework is important. This provides an holistic view of what is needed and will help establish your organisations’ current level of maturity and provide a roadmap for improvement going forward. This will be covered in detail in the next article.
(1)WEF, 2021 Advancing Supply Chain Security in Oil and Gas: An Industry Analysis http://www3.weforum.org/docs/WEF_Advancing_Supply_Chain_Security_in_Oil_and_Gas_2021.pdf
(2)Business Insider, 2021 - The US is readying sanctions against Russia over the SolarWinds cyber attack. Here’s a simple explanation of how the massive hack happened and why it’s such a big deal, https://www.businessinsider.com/solarwinds-hack-explained-government-agencies-cyber-security-2020-12?IR=T
(3)Chatham House, 2021 - The SolarWinds hack: A valuable lesson for cybersecurity,
(4)Cloud Security Alliance, https://cloudsecurityalliance.org/
(5)Nist, 2021 - Secure Software Development Framework, https://csrc.nist.gov/projects/ssdf
(6)ZeroFOX, 2021 - What is External Threat Intelligence, https://www.zerofox.com/blog/what-is-external-threat-intelligence/
About Bryan Baxter
Bryan Baxter has been in the IT Industry since 1992 in various roles before recently joining Wolfpack Information Risk. He has helped customers successfully manage and deliver IT infrastructures to around 7000 users in several countries, where, of course, the recurring theme has been keeping customers secure from cybersecurity threats. For more information contact Bryan Baxter, Wolfpack Information Risk,
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