Guideline on Information and Communications Technology Risk Management

February 2020


While the rapid pace of technological innovations has helped to transform financial institution processes and business models, such innovations are introducing significant risks at a time when institutions are becoming more and more interconnected or dependent on the legacy systemsA legacy system is a piece of hardware and/or software that continues to be used in an organization despite being superseded by more modern systems. It forms part of an organized assembly of resources enabling the collection, storage, processing and distribution of information. and external suppliers to carry out their activities.

The adoptionA contract under which the holder has the right, but not the obligation, to buy or sell a specific number of shares at a predetermined price during a specific period of time. of technological innovations is also increasing the risk of data being lost, leaked, stolen, corrupted, or accessed without authorization. Institutions are exposed to an ever-greater risk of increasingly sophisticated, frequent and difficult-to-detect cyber attacks.

Information and communications technology (ICT) risksThe AMF defines ICT risk as the business risk associated with the use, ownership, operation and adoption of ICT. This risk includes availability, continuity, security (including cybersecurity), change, data integrityThe quality that an individual has of being honest and having strong moral principles that he or she refuses to change. It is demonstrated through the individual’s actions and through the conduct of the his or her personal and professional business. and outsourcing risk. can have adverse consequences, both financial and legal, for an institution’s clients and reputation.

This guidelineA document that describes the steps that financial institutions can take to satisfy their legal obligation to follow sound and prudent management practices and sound commercial practices. describes the AMF’s expectations with respect to ICT risk. The ultimate goal of these expectations is to strengthen the financial sector’s resilience in response to this risk. In particular, these expectations are intended to ensure the development of appropriate security hygiene through the implementation of measuresSuch measures include both basic ICT governance practices and operational measures such as the timely deployment of software security updates, the detection of unauthorized traffic on network infrastructures, the management of information access rights, the strengthening of authentication mechanisms for access to critical systems and the monitoring of malware. that will help prevent a major incident and limit its impact.

Each institution is responsible for clearly understanding all its ICT risks and ensuring that they are appropriately considered in light of the institution’s nature, size, complexity and risk profileA financial institution’s overall level of risk exposure that is based on an evaluation of the risks inherent in the financial institution’s significant activities, its ability to manage risks, its financial condition and its commercial practices. . The institution is also responsible for staying current on ICT risk management best practices and adopting them to the extent that they meet its needs.

The AMF expects financial institutions to adopt and implement the expectations in this guideline by February 27, 2021.


1. Types of ICT risks

The AMF expects financial institutions to put in place a taxonomy that catalogues all types of ICT risks.

The taxonomy should be forward-looking and capture the technology risks that are ever-present in all financial institution processes. The taxonomy should be developed in order to facilitate the aggregation and obtain a comprehensive picture of its ICT risks. It should therefore provide a comprehensive set of ICT risks so that those involved in risk identification may consider all types of risks that could affect the institution’s objectives.

Technology risk should be assessed holistically, taking into consideration both common risks and the risks of not responding appropriately to technological changes or the arrival of new or emerging technologies in order to enhance the institution’s agility and ability to respond to changes over time.

In addition to operational risks derived from technology-related risks, the following strategic risksThese three groups of strategic risks can be described using other wording, according to the taxonomy established by the financial institution. can impede the achievement of the institution’s objectives and should be considered:

  • Technology governance risk;The risk that the board of directorsA body of elected or appointed individuals ultimately responsible for the governance and oversight of a financial institution. fails to put in place the requisite elements to govern the development and implementation of its IT strategy.

  • Technology positioning risk;The risk that, at the time the strategy is defined, the technology position aimed for in the industry is not adequately embedded in the business strategy, not viable or not feasible.

  • Technology implementation risk.The risk that, when implementing its strategy and strategic plan, senior managementThe group of individuals responsible for managing a financial institution on a day-to-day basis in accordance with the strategies and policies set by the board of directors. fails to achieve the sought-after strategic IT objectives and related business goals.

To guard against a false sense of security or urgency and optimally define ICT risk toleranceRisk tolerance sets boundaries on the level of risks a financial institution is prepared to accept based on its risk appetite. , the institution should, among other things:

  • use clear ICT terminology and a consistent taxonomy to describe risks;

  • aggregate ICT risksICT risks can be aggregated according to multiple dimensions (organizational units, types of ICT risks, processes, etc.). at the level of the institution so that they are considered in combination with all the other risks that must be managed.

In developing its risk taxonomy, the financial institution should aim for a reasonable number of categories so that risks may be properly aggregated without the discrete nature of the categories becoming eroded.

Some of the ICT risk categories that should be considered when developing the taxonomy are information security, crisis management, outsourcing, cloud computing, business continuityThe capability of an organization to continue delivering products or services at acceptable predefined levels following a disruptive incident. , program and project management,For example, risks may result from the interdependence between various projects or from the dependence of several projects on the same resources and expertise. change management, ICT operations, ethics, human resources and intellectual property.

If a financial institution has an existing risk taxonomy that is used within a particular functional area, such as internal auditInternal audit ensures the systematic and independent assessment of all risk management, control and governance processes. It constitutes the third line of defense of a financial institution. , it could be considered in the development of an organization-wide risk taxonomy, as it may include categories that have been proven to be applicable to the organization. Once developed, this taxonomy should be communicated to those directly involved in risk assessment and control activities so that it may be used consistently in the identification and aggregation of ICT risks.


2. ICT governance

The AMF expects financial institutions to implement ICT governance developed using accepted sources, recommendations and standards.E.g., OECD, G7, NIST, ISACA-Cobit and ISO.

ICT governance should reflect changes made over time. The quality of governance practices is an important factor in maintaining market confidence. ICT governance should therefore continuously take into account good practices recognized by existing professional and international bodies and should align with the institution’s business goals.

The following, in particular, should be considered in establishing ICT governance:

  • understanding and acceptance by individuals and groups within the institution of responsibilities related to ICT and data use;

  • assessment of ICT and ICT activities, when plans and policiesA set of general principles adopted by a financial institution for conducting its activities in a given area. are reviewed, to ensure that they align with the institution’s goals, reflect good practices and meet stakeholdersAny individual, group or organization that can affect, be affected by, or perceive itself to be affected by, a result, a decision or an intervention coming from another party. ’ needs;

  • evaluation of the institution’s plans to ensure that ICT will support business processes with the required capacity;

  • consideration of the data life cycle in defining responsibilities;

  • the extent to which ICT satisfies regulatory, legal and contractual obligations and professional and international standards;

  • the way individuals behave towards others (for all stakeholders) in ICT-related practices and decisions.

The various elements of the framework established by the financial institution (strategies, policies, etc.) should consider and align already existing provisionsThese provisions may have been defined or documented separately over the years and could contain contradictions. that are inherent in and relevant to the management of technology risks.

2.1 Roles and responsibilities

Board of directors

In accordance with certain expectationsAUTORITÉ DES MARCHÉS FINANCIERS. Governance Guideline. already issued by the AMF, the board should ensure, in particular, that:

  • senior management promotes a corporate cultureRefers to the common values and standards that define a business and influence its mindset, conduct and the actions of its entire staff. based on ethical and secure behaviour in the use of technology;

  • ICT-related information is exchanged with internal and external stakeholders in order to document its understanding of needs and make judgments about the current and future design of ICT governance;

  • the roles and responsibilities of the ICT function and the information security and business continuityThe capability of an organization to continue delivering products or services at acceptable predefined levels following a disruptive incident. management functions are clearly defined in establishing and maintaining ICT governance;

  • support structures, roles and functions are regularly assessed to enable the development and continuous improvement of ICT governance.

In addition, the board of directorsA body of elected or appointed individuals ultimately responsible for the governance and oversight of a financial institution. should ensure that the managers responsible for developing the ICT risk framework are competent and that the following individuals are assigned:

  • an individual responsibleSuch as a chief technology officer (CTO) or chief information officer (CIO). for the computer systems and information technology supporting the business’s objectives;This person is responsible for, among other things, execution of the ICT strategic plans, application of technology-related processes (operations, architecture, risk management, etc.) and development of the institution’s technology infrastructures and also presents technology proposals and status reports on the implementation of ICT-related strategies and frameworks to the board.

  • a member of senior management in the second line of defence, such as a chief information security officer (CISO), or another member of senior management in the second line of defence, to oversee the deployment of the framework ensuring information security and the physical security of the institution’s technology infrastructures;

  • a member of senior management in the second line of defence, such as a chief data officer (CDO), or another member of senior management in the second line of defence,AUTORITÉ DES MARCHÉS FINANCIERS. Governance Guideline to oversee the approved framework for the collection, storage and use of data across the institution;

• members of senior management to be responsible for all of the various information assets and ICT risks present in the institution.

The board of directors should obtain updates on the scenarios considered in developing and testing disaster recovery and business continuity plansA written action plan that sets out the procedures and resources required for the continuity and resumption of an institution’s operations. so that it understands the objectives in maintaining the availability of critical ICT operations and systems. In addition, it should have a thorough understanding of the escalation processes for security breaches or incidents, including when it should be notified.

Senior management

In addition to the roles and responsibilities that normally devolve to it,AUTORITÉ DES MARCHÉS FINANCIERS. Governance Guideline senior management should, in particular:

  • establish an ICT function that operates under the oversight of a second-line-of-defence control function;

  • clearly delineate the responsibilities of the information security function to ensure its independence and objectivity by, in particular, segregating it from ICT operational processes and implementing compensating controls where needed. This function should not be responsible for any internal auditInternal audit ensures the systematic and independent assessment of all risk management, control and governance processes. It constitutes the third line of defense of a financial institution. s;

  • define roles and responsibilities for maintenance and dissemination, within the institution, of the documentation and information required for informed stakeholder decision-making regarding ICT;

  • manage the relationship between the services provided by the ICT function and the business units in a formal and transparent manner while using a common language to ensure the achievement of strategic objectives;

  • establish and maintain an enterprise architectureA high-level view of an organization whose components include the organization of various system elements (software and/or hardware and/or human and/or informational), their interrelationships and the business strategy. consisting of the processes, information, data and layers of application, technology and security architectures;

  • identify the individuals responsible or accountable for ICT risk management and those who must be consulted or informed;

  • working with the compliance and internal audit functions, regularly evaluate the control environment (self-evaluations, assurance reviews, identification of control deficiencies, compliance of ICT-backed processes with laws,Particularly the Act respecting the protection of personal information in the private sector and the Act to establish a legal framework for information technology. regulations and contractual obligations, etc.);

  • periodically review non-compliance (including exceptions approved by the board of directors) with the frameworks established for ICT risk.Exceptions should be reviewed periodically in light of the changing nature of ICT and inherent threats to ensure that they remain at an acceptable level and will be corrected in a timely manner.

In establishing the ICT strategy, senior management should, in particular:

  • develop a holistic view of the business environments and the ICT environments (current and future) in order to identify the required transformation initiatives;

  • define and document how the ICT, technology architecture, organizational structure and key dependencies with partners and suppliers will evolve in order to support its business strategy;

  • properly align ICT strategic plans and business strategies on an ongoing basis while taking into account current and future ICT capacity;

  • consider using technological innovations in strategic planning and enterprise architecture decisions;

  • define objectives to maintain the institution’s capacity to anticipate, detect and recover from ICT incidentsAn ICT, cyber or information security incident normally occurs when an unplanned disruption in the delivery of ICT services or a security breach in a system compromises the availability, integrity or confidentiality of ICT data or systems. in order to ensure ICT system resilience.

Moreover, in terms of the institution’s information security, the designated member of senior management should, in particular:

  • develop, document and disseminate an information security policy that defines the principles and rules for safeguarding the confidentiality, integrity and availability of the information of the institution and its clients;

  • define clear information security objectives for systems, ICT services, processes and people;

  • apply the information security policy to all the institution’s activities and include information handled by external stakeholders within the institution’s scope;For external stakeholders, it is acceptable here to establish appropriate agreements regarding the secure treatment of information.

  • deploy controls for information assetsInformation assets (data, hardware and software) are not limited to those held by the institution. They also include information assets entrusted or delivered by clients or third parties. that are proportional to the criticality and sensitivity of those assets;

  • do systematic testing to ensure that the controls in place are effective;

  • deploy information security training and awareness programs;

  • produce security performance indicators covering areas such as the business impacts (for the benefit of non-technical personnel) and effectiveness of security controls.

Senior management should report on the following, in particular:

  • the objectives and indicators gathered in relation to ICT and its processes on a systematic and timely basis;

  • the results of monitoring done with respect to ICT-related best practices and standards in development, at the national and international levels, and the potential impacts of such best practices and standards on the institution’s activities;

  • key ICT issues, including significant ICT projects, priorities and incidents, as well as regular reports on ICT risk.

Other roles

The institution’s risk management functioThe chief risk officer (CRO) or a designated member of senior management must be able to synthesize, explain in plain language and communicate ICT-related information effectively to various audiences. should oversee its ICT function and assume responsibility for monitoring all ICT risks (i.e., both operational and strategic risks and risks arising from ICT-related innovationsFor example, risks of bias or unethical use of big data technologies and artificial intelligence.). This function should also rigorously monitor material and emerging ICT risks.

The objective assurance expected from the internal audit function regarding the sufficiency and efficacy of ICT governance should cover, among other things, the efficiency and effectiveness of ICT operations, the safeguarding of information assets, and the reliability and integrity of their reporting processes.

The institution’s internal audit activities should include a review of the design and effectiveness of the information security controls, including the controls maintained by external parties. Internal audit should also review the assurances provided by an external party when they have the potential to adversely affect the institution, its clients or other stakeholders.

Other roles defined across the institution—such as the person in charge of business management and the person in charge of human resources—have an effect on ICT risk governance and management. Although not directly involved in ICT risk governance and management, they are nonetheless stakeholders and should be considered in defining roles and responsibilities.


2.2 Integrity and competency

In accordance with the AMF expectations regarding integrity and competencyAn appropriate level of expertise, professional qualifications, knowledge or relevant experience in the financial industry. criteriaAUTORITÉ DES MARCHÉS FINANCIERS, Governance Guideline, effective and efficient governance, which includes information and communications technology, requires decision-making bodiesThe board of directors, senior management and persons in charge of oversight functions. to have an appropriate level of expertise, professional qualifications, knowledge or experience.

The members of the decision-making bodies and the established governance mechanisms (e.g., audit, risk management and ICT management committees) should a knowledge and understanding of ICT use, future trends and directions and have sufficient authority to fulfil their respective responsibilities.

When evaluating the competency of members of decision-making bodies, an aptitude and knowledge grid with ICT-related criteria should be developed, kept up to date and applied on a regular basis—or more frequently, if necessary—for individuals in strategic positions related to ICT governance and risk management.

The institution should therefore periodically take stock of all current ICT competencies within the institution and those needed to carry out strategies and achieve objectives.

To minimize the risk of having insufficient ICT expertise in key positions, a formal process for acquiring competencies pertaining to ICT-related strategic issues should be developed.

Similarly, a comprehensive ICT security awareness training program should be implemented for all personnel and should, at a minimum, take into account the current threat landscape (including cyber threats) and threat impacts, laws, regulations, the frameworks established by the institution and the responsibilities of personnel in safeguarding information assets.

The training program should be updated and renewed regularly for all of the institution’s personnel and for any service provider with access to information assets.

Moreover, the institution should conduct regular security screening of human resources (including consultants, partners and suppliers) before they are hired, over the course of their employment and after their employment ends, where those human resources have access to ICT systems and data and may expose the institution to data theft, sabotage, fraud and other ICT risks.


2.3 ICT documentation

The institution’s frameworks should clarify the roles and responsibilities of decision-making bodiesThe board of directors, senior management and persons in charge of oversight functions. and operating units in establishing, maintaining and securely consulting documentation and information enabling stakeholders to make informed decisions about ICT.

While the documentation may be prepared and maintained by various components of the institution, the key elements should be overseen by senior management and approved by the board of directorsA body of elected or appointed individuals ultimately responsible for the governance and oversight of a financial institution. .

This documentation should not be static but should, instead, evolve over time. As with the business, an institution’s ICT constantly changes based on acquisitions, updates and external influences. The documentation should contain sufficient aggregated information to facilitate decision-making concerning the ICT strategy.

In particular, the documentation should consolidate information that reflects the status of its ICT strategy, current and target architecture, strategic ICT risks and objectives, ICT plans and current plan status, ICT risk impact statements and existing processes and structures for ICT risk management, development methodology and operation processes.

The strategic documents derived from best practices should include, in particular:

  • a description of the situations faced by the institution and its business lines and support functions;

  • the ICT strategy components, strategic plan and deployment status;

  • a description of the impact of ICT risks on business strategies;

  • the ICT risk register and ICT risk and control matrix;

  • the current and target ICT strategic architecture;

  • ICT operating models and processes.


3. ICT risk management

The AMF expects the financial institution to consider all activities necessary to the preparation, treatment and monitoring required in managing ICT risks.

The development of strategies, policies and proceduresA set series of tasks to be performed. It is generally the result of imperatives that cannot be negotiated by the individual who applies it. enabling ICT risk identification, assessment, quantification, control and monitoring should take into account the preparation, treatment and monitoring activities that need to be carried out to lessen any harm that might occur in the first hours of an actual crisis. For example, all measures planned by the institution, including response and recovery measures, should be subjected to stress testingA risk management technique used to assess the potential vulnerability of a financial institution by testing defined and exceptional, but plausible, adverse scenario. . In addition, the external stakeholders and specialists required by those measures should be prequalified and contractual terms and conditions should be pre-established.

In implementing robust ICT risk management practices across the institution, the latter should also take into account the participation of external stakeholders to ensure that accurate information relevant to risk management is distributed and used by everyone.

The ICT risk management frameworkA set of policies, procedures and controls for managing an organization’s key functions. should make it possible to establish and maintain a holistic view of ICT risks, including relationships and dependencies between people, end-to-end business processes, the institution’s functions, ICT systems and assets supporting such processes and people. By taking stock of roles, processes and business functions, it should be possible to identify their relative importance and their interdependencies with the ICT risks.

3.1 Preparation

The selection of preparatory measures to manage ICT risks should, in particular, help to safeguard sensitive data (such as client information) against disclosure, leaks or unauthorized access. They should also contribute to ICT environment resilience. These measures should cover, among other things, access controls, authentication, data integrity and confidentiality, activity recording and security event monitoring.The appendix covers various additional measures to be considered and that have proven useful in managing the risks related to information security, ICT operations, outsourcing and ICT transformation projects.

During preparations, the financial institution should understand the impact of technology risk on operations, including mission, functions or reputation, as well as on assets and individuals. Consequently, the integrated approach to managing ICT risk should be applied institution-wide and should enable the institution to, among other things:

  • align all risk assessment tools and scales used and ensure consistent, agreed-upon and transparent use;

  • use a rigorous process to periodically identify information assets and their vulnerabilities in order to appropriately relate risks to assets in a holistic manner. The same applies to internal and external threats and potential likelihoods and business impacts in order to determine the level of risk and establish appropriate action plans. This asset management process should also cover data, personnel and the ICT systems (including the various hardware and software components of those systems) and the premises housing them;

  • use a classification frameworkThis classification should reflect the degree to which an information security incident affecting an information asset has the potential to adversely affect the institution and its clients or other stakeholders. enabling the criticality of data and information assets (including those managed by external stakeholders) to be defined, minimally, according to their availability, integrity and confidentiality requirements;

  • use ICT incident management processes with appropriate resumption and recovery objectives to ensure proactive risk management;

  • ensure proper and timely monitoring of activities to mitigate the risks recorded in the ICT risk register;

  • monitor the effectiveness of mitigation measures, along with the number of reported incidents in order to correct them when necessary;

  • consider financial, legal, regulatory, operational, client-related and reputational factors in assessing ICT risk.

In addition to assessing the ICT risk inherent in its activities, products or services (including, in particular, cyber risk), the financial institution should consider what this risk represents for its partners, suppliers and clients and also for other financial sector participants, when relevant.

The financial institution should assess ICT risks at planned intervals, when significant changes are expected or occur and when significant operational and security risks materialize, taking into account the established criteria. ICT risk assessment should be part of an ongoing systematic and cyclical process.

Furthermore, financial institutions should use methods enabling them to make the link between ICT risk scenarios and their potential impact on information assets and business processes so that all stakeholdersICT risk assessments require the outcomes to be expressed in clear and unambiguous business terms. Effective ICT risk management also requires the business and technology areas to share a common understanding of the risks that should be managed and the underlying reasons for them. ICT risk management stakeholders should have the ability to understand and express how adverse events or incidents may affect the institution’s business objectives. understand the effects of adverse events related to information and communications technology.

The financial institution should:

  • identify all potential individual points of failure in the ICT systems and network architectures to ensure that appropriate measures are taken to mitigate disruption risks;

  • carry out end-to-end business impact analyses for critical business processes to ensure that disaster recovery and business continuityThe capability of an organization to continue delivering products or services at acceptable predefined levels following a disruptive incident. plans appropriately prioritize the institution’s critical operations during ICT systems recovery;

  • consider a plausibleThe institution should consider, in particular, low-likelihood scenarios that have high financial or non-financial (reputation, compliance, etc.) impacts. set of disaster events and scenarios, including cybersecurity events, in recovery and continuity plan planning;

  • include provisions for recovery within specified time frames and periodic testing in the data backup strategy to ensure procedure effectiveness.

Processes and procedures ensuring ICT system resilience should continually take into account rapidly evolving threats. Such processes and procedures should enable containment of the impacts of potential security incidents and help accelerate a return to normal operations. They include response and recovery plan planning, communications, analysis, mitigation and continuous improvement.

To avoid increased exposure to security and stability risks, the financial institution should establish plans for the timely replacement of its ICT hardware and software before the end-of-support dates indicated by their suppliers.

3.2 Treatment

In treating ICT risks, the financial institution should, in particular:

  • determine all controls that are necessary to implement the treatment optionsA contract under which the holder has the right, but not the obligation, to buy or sell a specific number of shares at a predetermined price during a specific period of time. for the identified risks;

  • compare the controls so determined against existing best practices and verify that no required controls have been omitted;

  • produce a statement containing the necessary controls and the justification for inclusions or exclusions of controls;

  • maintain and use security frameworks and the processes and procedures arising from it to manage information systems and assets;

  • maintain and repair ICT system components in accordance with the institution’s established frameworks.

In addition, the financial institution should:

  • continuously detect abnormal network infrastructure, ICT system and information asset activity in order to understand the evolution and potential impacts of undesirable events and verify the effectiveness of protection measures;

  • test and maintain the aforementioned detection processes to ensure appropriate and timely knowledge of abnormal events;

  • execute and maintain response and recovery processes and procedures in order to ensure a response to detected cybersecurity incidents and the restoration of systems or assets;

  • receive, analyze and address the vulnerabilities identified by internal or external sources (in-house testing, bulletins or specialized security research);

  • perform and review planned activities to prevent the expansion of an event to other ICT systems, mitigate its effects and resolve the incident.

Access to data retrieval and extraction toolsFor example, the use of portable computer devices (tablets, cellphones, etc.), storage devices (USB keys, portable hard drives, etc.), e-mail, instant messaging and printed copies. should also undergo a risk assessment and should, in order to protect against potential data leaks, be authorized only if there is an actual business.

The financial institution should demonstrate that it assesses the risks related to ongoing maintenance of its legacy systems and that adequate controls are in place to effectively manage the risks of these technologies. If the legacy systems support critical operations, the financial institution should have a strategy in place for managing ageing infrastructure.

Applications developed or acquired by endusers to automate their operations, including applications accessible via the Internet, should be approved by the relevant business areas and the institution’s ICT function. Such applications should be taken into account in the information asset management and ICT risk management processes. The financial institution should ensure that appropriate safeguards against data loss or leaks and the exposure to malicious viruses linked to such applications are put in place. In addition, the financial institution should implement controls to monitor and detect the unauthorized use of such applications.The term Shadow IT (or sometimes Rogue IT) is also used to describe unapproved ICT systems implemented within organizations.

In risk and control assessment, protection mechanisms may include risk avoidance or elimination where the institution does not engage in a specific business activity. They may also include risk mitigation through controls or risk sharing or transfer.

The financial institution should regularly assess the adequacy of its resources in light of its risk appetiteThe aggregate level and types of risk a financial institution is willing to assume to achieve its strategic objectives and business plan. by means of stress tests for all material and potential risks, categorized by likelihood and impact (e.g., ICT risks, including cyber risksOperational risks that may affect information systems and the integrity, confidentiality and availability of the information those systems contain. ).

As part of the regular maintenance of its register of known and potential ICT risks, the institution should clearly describe, in particular, their attributes and related control activities in sufficient detail. The ICT risk register should be updated on a forward-looking basis and the adequacy of controls should be regularly assessed.

3.3 Follow-up

In accordance with the expectationsAUTORITÉ DES MARCHÉS FINANCIERS, Operational Risk Management Guideline. already issued, the AMF expects the financial institution to implement the mechanisms need to promptly advise internal and external stakeholders, including the AMF, who may sustain serious harm due to a major operational incidentAn event that disrupts, slows down or interrupts an institution’s critical functions. (cyber incident, system failure, etc.).

The processes and procedures put in place by the financial institution for incident management should allow action to be taken and services to be resumed as quickly as possible when ICT-related incidents occur. In particular, they should:

  • coordinate required responses and recovery activities after internal and external stakeholders have been notified;

  • help minimize the impacts on clients;

  • report incidents according to predetermined criteria;

  • share useful information contributing to enhanced information security;

  • manage public relations and the impact on the institution’s reputation.

In addition, the financial institution should conduct specific analyses following a major incident to improve its response and recovery plans. The institution should, in particular:

  • explore the data gathered in its infrastructures by its detection systems;

  • identify and measure the incident’s impacts;

  • mitigate or accept and document the risk for newly identified vulnerabilities;

  • identify lessons learned when resolving the incident and communicate them to internal stakeholders;

  • receive, analyze and respond to the vulnerabilities identified by internal or external sources (in-house testing, bulletins or specialized security research).

Based on lessons learned, observations and decisions made when managing ICT risks, the financial institution should review its strategies—particularly those developed during its preparatory activities (Section 3.1). The review should be guided by clear assessment objectives, established expectations and methodologies disseminated to stakeholders, and reports containing clear conclusions and tangible corrective actions.


APPENDIX - Complementary standards to the AMF’s guidelines

The AMF expects the implementation of sound and prudent management practicesA financial institution’s management practices ensuring good governance and compliance with the laws governing its activities, in particular, the assurance that the financial institution will maintain adequate assets to meet its liabilities as and when they become due and adequate capital to ensure its sustainability. , set out in all its guidelinesA document that describes the steps that financial institutions can take to satisfy their legal obligation to follow sound and prudent management practices and sound commercial practices. , to take into account specific proven and generally accepted practices related to ICT.

ICT risk management depends on the financial institution adopting the expectations described in various AMF guidelines, including those on governance, integrated risk managementA set of practices and processes, supported by a risk-aware culture and enabling technologies, that improves decision making and performance through a holistic view of a financial institution’s set of risks. and compliance. However, ICT risk management also depends on the expectations described in the previous sections of this guideline and the implementation of a number of ICT-specific practices.

In this perspective, the following practicesThe topics discussed in this appendix are drawn from best practices recommended by national or international organizations, including the NIST, Cobit, the G7 and the ISO. contribute to the establishment of a holistic approachBased on an overall, integrated view, a management approach emphasizing the importance of all risks of a financial institution, while taking account of the interdependence between them. . Applying them helps to prevent and mitigate ICT risks such as those related to the use and operation of ICT.

ICT security

The financial institution must implement robust security mechanisms enabling it to ensure the delivery of critical services and the identification of ICT incidents.

Mechanisms to consider include identity and access management, training and awareness, network segregation and protection of network integrity, data security, protection of endpoint devices, verification of software and microcode integrity, information protection processes and technological protection solutions contributing to system and information asset resilience.E.g., firewalls, network access controls, intrusion detection and prevention tools, anti-virus software, encryption and log monitoring and analysis tools. Similarly, event and anomaly detection, continuous information system monitoring and detection process monitoring should be considered.

The financial institution should define a process to gather, secure, store, consolidate, treat and review ICT event logs to facilitate security monitoring operations. The latter should include firewall, application, operating system and authentication event logs.

The financial institution should ensure that physical and logical accessThis includes both regular or high-privilege user access and remote access. to information assets and associated resources is limited to authorized users, processes and devices and to activities authorized in accordance with a rigorous and predefined process.

Access rights should be granted on a “need to know,” “least privilege” or “segregation of duties” basis, only to authorized personnel and in such a manner as to prevent large data sets from being improperly accessed and security controls from being bypassed.

The financial institution should limit the use of generic or shared access accounts and ensure that ICT system users can be identified. Exceptions should be justified, compiled and documented.

The financial institution should subject its information security controls to various types of periodic independent assessments, tests and reviews as well as penetration testingPenetration testing and vulnerability assessments produce an image of a computer system in a specific state and at a specific time. This image is limited to the portions of the system that are tested during penetration attempts. In this perspective, penetration testing and vulnerability assessments are not substitutes for an ICT risk assessment. and red team exercises.Red team exercises simulate targeted attacks to test the institution’s detection and response capabilities. The institution’s control processes for people and technology are reviewed throughout the exercise by simulating the objectives and actions of an attacker.

In assessing information security risks, the financial institution should, among other things:

  • identify information security risks related to the loss of confidentiality, integrity and availability of information, and name the persons responsible for the risks;

  • establish and maintain information security risk criteria, including risk acceptance criteria and criteria for assessing information security risks.

The financial institution should actively maintain the security of its information while taking into account threats and vulnerabilities, including those resulting from changes to its information assets, the stage they are at in their life cycleThis refers to the process from information asset planning and design through to decommissioning and disposal. and its business environment.

There should be adequate segregation between operational security and risk management duties in developing appropriate ICT information security for the financial institution’s ICT systems.

ICT operations

Technological innovations, such as cloud computing, the Internet of things and metadata, have a significant impact on the ICT function (particularly at the level of the processes that must be adapted, including capacity management and security management, and knowledge that should be enhanced to fit new ICT systems). In this context, it is important for ICT operations personnel to have the information and tools they need to detect any potential problems in processing centre operations, networks, IT security infrastructures and user support. Such tools and information should, among other things, assist in:

  • preparing an exhaustive inventory of information processing hardware, resources, locations, etc.;

  • prioritizing ICT risk mitigation efforts;

  • identifying mitigation controls such as policies and procedures for physical and logical security; data, personnel and change management; information distribution and transmission; backups; and user support;

  • performance, capacity planning and control self-assessment monitoring and reporting.

The financial institution should implement a process for managing the configurations of the hardware and software components of its information systems so as to have visibility and effective and secure control of its systems.

The financial institution should minimize business disruption risk by establishing appropriate processes to manage changes affecting ICT equipment (hardware and software) and procedures involved in the development, delivery, support and maintenance of ICT production systems. These processes should provide for, among other things:

  • pre-implementation security risk and impact assessments (particularly in relation to other information assets);

  • sufficient testing for the new ICT and planned upgrades and patches to the existing systems prior to rollout;

  • requirements and approval levels needed for the change rollout;

  • clearly defined procedures for evaluating, approving and implementing urgent changes, including approvers, in order to reduce production environment security and stability risks;

  • strict segregation of duties in the software updating process in order to restrict the ability of a single person to develop and compile software code and deploy it from a development environment to a production environment;

  • activation of activity recording in the audit and security logs.

To reduce business interruption risk from the exploitation of software bugs or vulnerabilities, the institution should establish a framework of secure practices and standards for programming, source code reviews and application security testing for its ICT systems. Any information and ICT system availability, integrity and confidentiality issues identified in applying such practices should be compiled, monitored and corrected.

The financial institution should ensure that processes are deployed to assess and manage all operational risks associated with the use, ownership, operation and adoptionA contract under which the holder has the right, but not the obligation, to buy or sell a specific number of shares at a predetermined price during a specific period of time. of ICT. The institution should, in particular:

  • implement an appropriate ICT operational structure to support the institution’s business activities;

  • review and understand how the existing systems support the related business processes;

  • support an appropriate control environment through the identification, assessment, management and monitoring of ICT operational risks based on precepts similar to those set out in the Operational Risk Management Guideline;

  • create a secure physical and logical operational environment;

  • provide for operational continuity and resilience;

  • provide for appropriate selection, staffing, replacement and training of ICT personnel.

Outsourcing and cloud computing

Outsourcing does not necessarily reduce ITC-related risks. It can expose the institution to increased security, operational performance and business continuityThe capability of an organization to continue delivering products or services at acceptable predefined levels following a disruptive incident. risks if poorly managed. Responsibility for properly managing those risks continues to rest with the institution. The institution should therefore identify the ICT strategic risks involved in outsourcing initiatives, implement an effective risk program for managing such risks, and monitor the risks stemming from any outsourcing arrangement.

In accordance with the expectationsOutsourcing Risk Management Guideline, 2010. issued by the AMF, the financial institution remains responsible for recovering its operations after a disaster affecting its suppliers when its ICT strategy is outsourced with cloud computing. It should also consider ICT risk, particularly cyber risk, when assessing the level of experience and expertise required to perform the outsourced activity and manage the outsourcing relationship.

The financial institution should ensure the effectiveness of its ICT risk management frameworkA set of policies, procedures and controls for managing an organization’s key functions. when outsourcing agreements are entered into with external service providers or members of its group.

The increasing use by financial institutions of cloud computing services carries many advantages (economies of scale, access to good practices, agility, etc.). The distributed nature of such services may also enhance resilience to disasters or service disruptions. The AMF considers cloud computing services to be a form of outsourcing. Financial institutions should therefore refer to the AMF’s expectations in its Outsourcing Risk Management Guideline.

The financial institution should have a clear understanding of the typical characteristics of cloud computing services, including collocation, data amalgamation and a strong propensity for computer processing to be performed at multiple or distributed sites. The institution should consider taking actions to identify and manage the risks associated with data access, confidentiality, integrity, sovereignty, regulatory compliance and auditing. In particular, the financial institution should satisfy itself that the service provider has the ability to identify and segregate client data through robust physical and logical controls. The financial institution should also keep all information relevant to the management of its data-related risks (e.g., nature, sensitivity and location(s) of data processing, storage and traffic) in its centralized list of material outsourcing arrangementsAn outsourcing arrangement that may have a major impact on an institution’s financial condition, its operations and, ultimately, its reputation. .

In the specific context of outsourcing and cloud computing, the financial institution should, in particular:

  • contractually secure its right to audit (and the right to audit of the relevant authorities, if applicable) and its right to access the premises of the cloud computing supplier;

  • ensure that data and the location of computer processing are secure through the use of appropriate controlsWhen establishing contractual and service level agreements, the institution should, among other things, consider using information security objectives and measures, applying its own definition of the data life cycle and determining its security monitoring and data encryption needs. (established using a risk-based approachA prudential methodology that involves graduating the supervision of financial institutions based on their respective risk profiles. ) such as encryption technologies for data in transit, in memory and at rest;

  • mitigate supply chain outsourcing risks when suppliers outsource certain activities to other suppliers;

  • develop appropriate contingency plans and exit strategies enabling the institution to terminate any contractual agreement without any disruption in service delivery or any impact on regulatory compliance or the continuity and quality of ICT services provided to clients;

  • monitor the development of potential concentration riskRefers to an exposure with the potential to produce losses large enough to threaten a financial institution’s financial health or ability to maintain its core operations. if the delivery of critical services depends on a small number of service providers;

  • monitor and obtain assurance of supplier compliance with security objectives and measures and performance expectations.

Given the number of suppliers and the variety of potential impacts that outsourcing and cloud computing can have on financial institutions, strict controls should be put into place. Cybersecurity should not be considered only at the level of major suppliers or critical service providers. Certain other suppliers could, in fact, be a weak link in the security processes.

While using the services of certain third parties may not constitute a form of outsourcing, many of those services are delivered using ICT or involve information that is potentially confidential. Such third parties may also be exposed to security breaches. The financial institution should assess and appropriately manage the confidentiality breach, integrity breach and availability breach risks associated with the information processed by such third parties.

Change projects and programs

The implementation of any ICT strategy requires a formal start-up of technology change management programs. Such programs require resources and need to be properly managed and monitored. They also introduce new risks that have to be mitigated. These risks include, among other things, client service disruptions, loss of competitive advantages, negative reputational impact and delays in implementing critical and strategic products or processes.

The financial institutions should establish a project management framework that will ensure the ongoing use of management practices to deliver results that meet business and security needs and objectives. Risk management under the framework should allow the related risks to be identified, assessed, managed and monitored throughout a project’s life cycle.

This management framework should cover the practices needed to manage a project’s entire life cycle. It should also enable the development of the comprehensive ICT project plans required to implement the strategies. These project plans should clearly define the project scope, cost-benefit and feasibility analyses, activities, deliverables and key milestones, and the roles and responsibilities of the resources needed for each project phase.

When projects relate specifically to the acquisition, development or modification of new or existing ICT systems, the financial institution should ensure that the processes, procedures and controls in its framework adhere to the security-by-design principle to ensure that a reliable, attack-resilient ICT system is implemented.

The financial institution should standardize its project management methodology and support it with tools. It should clearly define the ICT system development life cycle, which consists of various steps—including the identification of information security needs—that must be completed in sequence so that business needs can be translated into systems or applications and those systems and applications can be properly maintained.

In addition, the institution should manage project-generated structure- and process-level changes, including informal and intangible aspects (e.g., perceived impact and changes to work habits), communications, organizational readiness (e.g., resistance to change), training and post-launch support.