Item 1C. CYBERSECURITY.
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Item 1C. CYBERSECURITY.
RISK MANAGEMENT AND STRATEGY
We review cybersecurity risk as part of our overall enterprise risk
management program. This ensures that cybersecurity risk
management remains a top priority in our business strategy and
operations.
MANAGEMENT'S ROLE IN MANAGING RISK
Primary management responsibility for assessing, monitoring and
managing our cybersecurity risks rests with our chief information
security officer ("CISO"). Our current CISO has over 30 years of
experience in information technology and cybersecurity in the
United States military, retail and healthcare sectors and oversees
our team of cybersecurity professionals. The CISO is regularly
informed about recent developments in cybersecurity, including
potential threats and innovative risk management techniques.
The CISO implements and oversees processes for the regular
monitoring of our information systems. We use various tools and
methodologies to manage cybersecurity risk that are tested
regularly. We also monitor and evaluate our cybersecurity
posture and performance on an ongoing basis through regular
vulnerability scans, penetration tests and threat intelligence
feeds. In addition, we engage third-party consultants to conduct
annual cybersecurity assessments and to conduct audits for
compliance with regulatory, Sarbanes-Oxley Act, Service
Organization Control Type 2 and International Organization for
Standardization standards. We also engage third parties to
assess our cybersecurity maturity and risk management
programs.
We use a cross-departmental approach to addressing
cybersecurity risk, with our cybersecurity, product security and
legal teams presenting quarterly on key topics to a committee of
leaders in technology, legal, finance, regulatory and corporate
affairs functions. This leadership committee meets quarterly to
ensure that we have input and oversight from critical
stakeholders into our cybersecurity program and evolving issues.
The CISO oversees a training and awareness program for
employees to take part in protecting the Company against
cybersecurity risks. We have implemented annual mandatory
security education to help employees understand cybersecurity
risks and comply with our cybersecurity policies. Additionally, we
provide frequent communications around pertinent cybersecurity
topics and policies to all employees. We also provide additional
cybersecurity and data protection training to employees in certain
roles.
As part of our cybersecurity risk management program, we also
conduct cybersecurity, data protection, and privacy assessments
on all third parties who integrate with Stryker’s data, network,
systems and products. We use a combination of internal and
external tools to confirm that these third parties meet our security
requirements. We leverage standard industry threat model and
privacy impact assessment concepts to confirm that data
minimization and adequate data protections are in place. We
perform supplemental reviews as necessary, commensurate with
the risk associated with each vendor.
In the event of a cybersecurity incident, we have an incident
response plan that includes immediate actions to mitigate the
impact and long-term strategies for remediation and prevention of
future incidents. The cybersecurity and product security teams
routinely practice this plan with functions across the organization.
We conduct tabletop exercises with senior management, during
which we practice the procedures in place to ensure that
potentially material cybersecurity risks and incidents are
escalated to management and the Board of Directors where
applicable.
GOVERNANCE
Cybersecurity risks are overseen by the full Board of Directors
and the Audit Committee. The Audit Committee is central to the
Board of Directors’ oversight of cybersecurity risks and bears the
primary responsibility for overseeing cybersecurity risk. The Audit
Committee actively participates in strategic decisions related to
cybersecurity, offering guidance and approval for major
cybersecurity initiatives. This involvement ensures that
cybersecurity considerations are integrated into our broader
strategic objectives.
Our CISO provides comprehensive updates to the Audit
Committee at least three times a year and the full Board of
Directors periodically. These briefings include a range of topics,
including:
-
Current cybersecurity landscape and emerging threats;
-
Status of ongoing cybersecurity initiatives and strategies;
-
Incident reports and learnings from any cybersecurity events;
-
Metrics demonstrating company and industry-standard
prevention of common threats; and
- Regulatory changes impacting cybersecurity requirements
and strategy.
The Board of Directors is aware of the critical nature of managing
risks associated with cybersecurity threats and is actively
engaged in our cybersecurity risk management strategy.
RISKS FROM CYBERSECURITY THREATS
Although cybersecurity risks have not materially affected us,
including our business strategy, results of operations or financial
condition, to date, we face numerous and evolving cybersecurity
threats in our business. For more information about the
cybersecurity risks we face, see the risk factor entitled "We, our
business partners or our third-party vendors could experience a
material failure or breach of a key information technology system,
network, process or site" in Item 1A. Risk Factors.
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