Most bank boards struggle with cybersecurity oversight because they don’t know what questions to ask, how to interpret the answers or whether their security measures are working. Directors may approve cybersecurity budgets without understanding if those investments actually reduce risk, or they may review incident reports without grasping whether response times meet industry standards. They can describe their cybersecurity framework, but often can’t explain what their institution does with the results.

The challenge is compounded further when cybersecurity is presented as a jargon-filled IT issue rather than the business-critical risk it represents, creating a dangerous gap between regulatory expectations and board-level understanding that leaves institutions vulnerable — not just to cyber threats, but also to regulatory scrutiny.

Whether you’re a director seeking to understand what your institution’s NIST Cybersecurity Framework (CSF) or ISO framework results really mean for your risk profile, or an executive preparing risk dashboards, security briefings and incident reports for your board, the ultimate risk assessment strategy is to provide practical approaches that close the cybersecurity literacy gap.

Board cybersecurity literacy doesn’t mean directors must become technical experts. However, it does require structured questioning, transparent reporting that translates technical risks into business impact and honest assessment of organizational maturity.

The Uncomfortable Truth About Board Cybersecurity Literacy

Here’s what I’ve observed after years of working with bank boards: Most of them generally don’t meet expectations when it comes to cybersecurity oversight. That’s not an indictment of their dedication or intelligence; it’s simply recognition that cybersecurity has evolved faster than board education.

Many directors can tell you which framework their institution uses — whether it’s the NIST CSF, ISO standards or something else. But when you dig deeper and ask what they’re doing with that framework, you often get blank stares. Completing an assessment means nothing if you can’t articulate what you learned from it and what you’re doing to improve. The critical question isn’t “Did we complete our assessment?” Instead, it’s “What have we done with the results?”

The Framework Transition Challenge

The Aug. 31, 2025, sunset of the FFIEC Cybersecurity Assessment Tool (CAT) has forced smaller institutions to adopt more complex frameworks. The leap isn’t incremental — it’s substantial. But the transition is long overdue; many mature organizations should have already moved beyond the CAT’s simplified approach to adopt more comprehensive frameworks.

The CAT provided a simple rating system that scored your cybersecurity maturity from one to five across different domains, including cyber risk management, controls and threat intelligence. The NIST CSF requires significantly more work, including comprehensive risk assessments across five core functions, detailed control documentation and ongoing measurement of outcomes rather than simple numerical ratings. That makes it less user-friendly for small banks, but risk assessment should never be contingent on how easy it is to complete.

Community banks also face a severe shortage of qualified cybersecurity professionals. This isn’t just an inconvenience; it’s a fundamental challenge that boards must address strategically. Smaller organizations may need to invest in external expertise to complete assessments. That’s not a sign of weakness. It’s recognition that resource constraints make professional oversight frameworks even more critical.

Knowledge gaps among bank boards are prominent. A director once told me their institution scored well on their cybersecurity assessment, but when I asked what specific improvements resulted from those findings, they couldn’t answer. That disconnect between completing an exercise and achieving real security maturity represents exactly what needs to be addressed to develop real cybersecurity preparedness.

Five Essential Board Responsibilities

Directors don’t need to understand the technical details of firewalls or encryption. However, they do need to fulfill five essential oversight responsibilities:

1. Understand Your Security Posture

Board members should ask management to explain the cybersecurity framework in plain language, request summaries of their security posture — including both strengths and weaknesses — and understand their top five security improvement priorities for the coming year, along with specific, measurable goals.

For executives preparing these briefings, present framework results as a narrative, not a checklist. Translate technical findings into business risks with a clear improvement roadmap. Your directors can’t provide effective oversight if they don’t understand what you’re telling them.

2. Ask The Right Questions

The questions directors ask matter more than whether they understand every technical answer. Focus on the following questions: How do we compare to peer institutions? What is the business impact associated with our three highest-rated risks? How do we validate that our controls are actually working?

That last question is particularly important. Many institutions assume that because they have implemented a control, it must be working. Executives should be prepared with peer benchmarking data. Quantify risk in dollars and customer impact, not technical metrics. Include validation results, not just implementation status.

3. Set Clear Expectations

Directors need to define the institution’s acceptable risk tolerance for different types of threats, as well as establish a reporting cadence and format that enable informed decisions and require explanations in business terms, rather than technical jargon. If you can’t understand what you’re being told, you can’t provide effective oversight.

Executives should request that the board define its risk appetite explicitly. Propose a reporting rhythm that strikes a balance between staying informed and not overwhelming directors. Test materials on non-technical colleagues first.

4. Evaluate Resource Allocation

The board should review whether the cybersecurity budget matches the institution’s stated risk appetite. You can’t credibly tell regulators and customers that security is a priority while underinvesting in it. When spending doesn’t match stated priorities, it’s only a matter of time before that gap is exploited.

Executives should show budget trends and compare spending to peer institutions and industry benchmarks. Be transparent about skill gaps. If bringing in outside expertise for assessments, explain why that’s a strength. Present how security investment connects the dollars spent to the risks mitigated.

5. Assess True Security Maturity

Directors shouldn’t accept “we completed the assessment” as proof of security. Ask what management has done with the framework results to strengthen security. Most importantly, evaluate whether security is treated as a strategic advantage or just a compliance checkbox.

For executives, lead with outcomes, not activities. Show how framework findings drove specific improvements. Demonstrate measurable progress year over year. Make the strategic case for security as a competitive differentiator, not just a regulatory obligation.

Putting It Into Practice

Consider developing a one-page dashboard that answers the questions boards really need to know: What are our top three risks? What are we doing about them? How do we compare to peers? This kind of clear, focused reporting enables both effective oversight and productive board conversations — without overwhelming directors with technical details or requiring executives to explain the same concepts repeatedly.