A Literature Review on Digital Transformation in the Financial Service Industry

It is often stated that IT is able to transform entire industries. The emergence of digital technologies enables, among other things, new business models and therefore, obviously constitutes an industry transformation potential. However, IS research that actually deals with digitally enabled industry transformation is still rare. Motivated by its IT intensive nature, the research focus of this paper lies within the financial service industry. Prior research that deals with individual units or sectors is synthesized with the aim to draw inference on the financial service industry. The identified research articles are categorized into business, customer and technology relationship. The results include that digital technologies enables new business models, cause (dis)intermediation and customer centricity becomes increasingly important for financial service providers. Additionally, the interaction between user and technology changes and information is increasingly digitized. Finally, possible future research questions are named

NSA Revelations of Privacy Breaches: Do Investors Care?

Our study is focused on the financial impact of NSA-security and privacy breach events announced in the news media between June 2013 and March 2014. While prior research has provided empirical evidence on the stock market reaction of security and privacy breaches such as confidentiality, integrity and availability breaches, there is scarce research on the financial impact of NSA-related security and privacy breaches. Based on previous studies, we apply the event study framework to analyze how NSA revelations influence investor’s confidence. Results show that NSA-breach announcements have a negative impact on investors’ confidence, which is confirmed by the negative cumulated abnormal returns on the event date. Our study contributes hence with insights on a relatively new phenomenon of high relevance concerning the security of information assets

How Data Breaches Ruin Firm Reputation on Social Media! - Insights from a Sentiment-based Event Study

Data breach events are heavily discussed in social media. Data breaches, which imply the loss of personal sensitive data, have negative consequences on the affected firms such as loss of market value, loss of customers and reputational damage. In the digital era, wherein ensuring information security is extremely demanding and the dissemination of information occurs at a very high speed, protecting corporate reputation has become a challenging task. While several studies have provided empirical evidence of the financial consequences of data breaches, little attention has been dedicated to the link between data breaches and reputational risk. To address this research gap, we have measured the reputational effect of data breaches based on social media content by applying a novel approach, the sentiment-based event study. The empirical results provide strong evidence that data breach events deteriorate the reputation of companies involved in such incidents