Vanguard's New CEO Kept Up at Night by Cybersecurity
Vanguard's new Chief Executive Mortimer J. "Tim" Buckley not only has to worry about growing a business that already has $5 trillion in assets under management – another top concern is making sure that data pertaining to its legions of customers are safe from hackers and data breaches.
In a wide-ranging interview with ETF.com, Buckley, formerly Vanguard's chief information officer, said that cybersecurity is a top priority even in his role as CEO. "Understandably, many Americans have concerns about the safety and security of their assets and personal information. More and more, we're all reading horror stories in the news and bracing for the next data breach. It can be a scary time for many of us," Buckley said in the ETF.com interview. "It's stunning how it's advanced and how the threat has increased."
To say that cybersecurity attacks are a big risk is an understatement for companies around the globe. One just needs to look at the recent data breach at Equifax Inc. (EFX) to see the impact it can have on consumers and companies. The Equifax breach compromised the data of more than 145 million customers, including 209,000 credit card account numbers. That has resulted in a slew of lawsuits and investigations by lawmakers and regulators, as well as the ouster of Equifax Chief Executive Richard Smith. But Equifax isn't the first big-name company to become a victim of a hack, nor will it be the last.
According to Buckley, Vanguard is pouring money into making sure that its clients' data and assets are secure. He said that the company follows industry best practices, uses state-of-the-art technology and employs "rigorous" online security standards. It also has a number of safeguards in place to increase the layers of protection for clients. "An organization should never believe they're immune to an attack. Constant review and preparation should be of supreme importance for all companies," he said in the interview with ETF.com.
When asked if Vanguard is getting too big, given its $5 trillion in assets under management, Buckley reiterated what he has been saying as he makes the interview rounds – that is its clients' money, not Vanguard's. "Our revenue is $5 billion. We're hardly Amazon," he said, noting that the company does not put a high value on its growth. "We see our size and scale as an advantage, enabling us to continue to lower the cost of investing and reinvesting in the business to improve client experience and outcomes," he said.