Study: Security Spending At U.S. Firms Rises Modestly Since 9-11

By Agence France-Presse Major U.S. firms have only slightly raised security spending since the Sept. 11 attacks, raising questions about their vulnerability to terrorists, a study showed July 9. Corporations had been widely expected to plow money into beefing up security. But a report by a private economic analysis firm, the Conference Board, New York, showed a median -- or middle-of-the-range -- increase in security spending of just 4% since Sept. 11, 2001. The report, Corporate Security Management, was based a survey of more than 330 security officials at large companies. "While nobody knows how much security is enough, there are legitimate concerns about corporate vulnerability," said the report's author, Conference Board security analyst Tom Cavanagh. "Since about 80% of America's security infrastructure is controlled by the private sector, corporate security managers will play an increasingly vital role in protecting key industries and the people who work in them and are based in them." Security spending was highest in six critical industries: transport, energy, financial services, media and telecommunications, information technology, and health care. Seven percent of the companies surveyed had boosted spending on security by more than 50%. But "a 4% median increase in security spending seems counterintuitively small in light of our concerns about terror," said Daniel Kropp, president of industrial security group ASIS International, Alexandria, Va., which sponsored the report. Spending levels must be judged against the degree of risk faced by companies, however, he said. "Throwing money at a problem is not going to solve it," Kropp said. "Given our nation's knowledge and experience at the time, it is hard to imagine the security system that would have prevented what happened on 9-11 or that can protect us from every possible threat today." The report found that only 26% of corporate security directors, 19% of corporate risk managers and 14% of information technology security chiefs strongly agreed that they had enough money to do the job. Copyright Agence France-Presse, 2003