Essential Cloud Security Risks CEOs Can’t Afford to Ignore
More than half of enterprise and SMB workloads are now running in public clouds.
It’s safe to say, the cloud has fundamentally transformed how business operates and while this digital transformation has delivered greater flexibility and scalability, it has also introduced a complex web of cybersecurity risks. Many of these risks are just becoming clear, and more of them appear all the time as cyber criminals get more creative and, with the help of AI, more (frighteningly) productive.
CEOs know that cyber risks are a major threat to business operations: 62 percent of CEOs in the 25th Annual PwC CEO Survey reported that a cyber incident would inhibit their ability to sell their products or services. With such a large number of companies depending on third-party cloud infrastructure for their operations, though, do CEOs actually understand the risks they face? How many companies have clear, real-time visibility into the security of their cloud providers? And all of the other third parties who connect to those cloud providers?
As even more organizations move toward cloud adoption, often migrating critical business operations and sensitive data to cloud environments, the stakes have never been higher. A single cloud security breach can cost organizations millions of dollars, damage brand reputation, and expose them to regulatory penalties. For CEOs navigating this landscape, understanding these threats isn't just an IT concern. It's fundamental to the survival and resilience of your business.
The Current Cloud Threat Landscape
Cloud environments have become prime targets for cybercriminals, and the numbers paint a concerning picture. According to data from SentinelOne, 80% of companies have encountered an increase in the frequency of cloud attacks. Add to that the fact that data breaches solely involving public clouds were the most expensive type of data breach. According to IBM, these public cloud breaches cost USD 5.17 million on average, a 13.1% increase from last year. This significant increase underscores the financial stakes involved in cloud security failures.
Those stakes increase all the time as cloud innovation and adoption accelerate. According to the 2025 State of Cloud Security Report, nearly a third of cloud assets are neglected today, and each asset contains on average 115 vulnerabilities. As those cloud assets expand and become increasingly interconnected, the risk grows exponentially. Their report reveals that 76% of organizations have at least one public-facing asset that enables lateral movement, turning a single risk into a vulnerability for countless organizations.
Unlike traditional network perimeters, cloud environments present an expanded attack surface that includes multiple access points, complex integrations, and shared responsibility models that can create security gaps. The interconnected nature of cloud services means that a breach in one area can quickly cascade across an organization's entire digital infrastructure.
Risk 1: Identity and Access Management Vulnerabilities
One of the most critical cloud security challenges facing organizations today involves identity and access management (IAM). Cloud environments rely heavily on digital identities and access controls, making them attractive targets for credential-based attacks, one of the most common ways attackers use to infiltrate organizations. Credential-based attacks are cyberattacks where adversaries use stolen, guessed, or otherwise obtained authentication credentials—such as usernames, passwords, tokens, or session keys—to gain unauthorized access to systems, networks, or data. According to the 2025 Verizon Data Breach Investigations Report, 88% of attacks against basic web applications involved the use of stolen credentials.
Why are cloud IAM systems so difficult to secure? A combination of technical complexity, fragmented environments, and evolving business needs make cloud IAM systems especially challenging to secure. Organizations increasingly operate in multi-cloud and hybrid environments, leading to fragmented IAM architectures with multiple identity providers (IDPs) and legacy systems that are often incompatible with modern security protocols. Additionally, many enterprises are burdened by decades of IAM technical debt and non-standard legacy applications, which are not easily integrated with modern cloud IAM solutions. And finally, inadequate real-time monitoring and limited visibility into who is accessing what resources, from where, and under what circumstances, make it hard to detect and respond to unauthorized or suspicious activities quickly.
Single sign-on (SSO) systems have become increasingly popular with organizations for the convenience they provide, but they have also become particularly attractive targets. Attackers focus on compromising these centralized authority stores because successful access provides broad access across multiple cloud services and applications. The challenge for CEOs is that these systems are often managed by IT teams without sufficient oversight from business leadership, creating blind spots in organizational security posture.
The digital identities that cloud environments have enabled have created vast flexibility and efficiencies at the same time as exposing major vulnerabilities. Just take the case of North Korean IT workers securing employment under false identities and using their access for network compromise and extortion: this incident illustrates how cloud environments can be exploited from within. These threats are particularly difficult to detect because they involve legitimate user accounts with authorized access.
Risk 2: Configuration Errors and Mismanagement
Cloud misconfigurations lead to data breaches by unintentionally exposing sensitive resources or granting excessive permissions, making it easier for attackers to gain unauthorized access. These misconfigurations can occur in several ways:
Overly permissive Identity and Access Management (IAM) roles: Granting users or services more access than necessary allows attackers, once inside, to escalate privileges or move laterally within the environment.
Publicly accessible storage buckets: Misconfigured storage (such as AWS S3 or Azure Storage) set to public instead of private can expose sensitive data to anyone on the internet, as seen in high-profile breaches like Capital One and Pegasus Airlines.
Misconfigured firewalls and network settings: Inadequate firewall rules or open ports can provide attackers with entry points to internal systems.
Disabled or insufficient encryption: Data that is not properly encrypted at rest or in transit can be easily intercepted or accessed by unauthorized users if other controls fail.
Lack of logging and monitoring: Without proper logging, organizations may not detect unauthorized access or anomalous activities in time to prevent or mitigate a breach.
Risk 3: Supply Chain and Third-Party Risks
Third party risks are a persistent cybersecurity concern, but cloud environments introduce unique supply chain security challenges that extend far beyond traditional vendor relationships.
Third-party dependencies create cascading failures: Your cloud provider relies on dozens of upstream vendors - from DNS services to cooling systems to fiber optic cables. When these invisible dependencies fail, they can take down major cloud regions. The 2021 Fastly outage that knocked offline Amazon, Reddit, and CNN stemmed from a single customer's configuration change, not the primary cloud provider itself.
Supply chain attacks target cloud infrastructure: Hackers increasingly target cloud providers' software supply chains rather than attacking companies directly. The 2021 SolarWinds hack demonstrated the devastating effectiveness of this strategy, compromising thousands of organizations through a single compromised vendor update. Interdependencies driven by cloud adoption mean that your data security now depends on the coding practices of companies you've never heard of, buried deep in your cloud provider's technology stack.
Vendor lock-in costs compound over time: Moving significant workloads between cloud providers can cost millions and take years. What starts as a simple migration becomes increasingly complex as you adopt proprietary services, APIs, and data formats. This dependency gives providers significant pricing power and limits your strategic flexibility during contract negotiations.
Shared responsibility creates blind spots and compliance risk: Cloud providers typically handle infrastructure security (security of the cloud) but leave application and data protection (security in the cloud) to customers. This "shared responsibility model" creates gaps where both parties assume the other is handling critical security controls, leading to vulnerabilities. These vulnerabilities are a two-pronged threat: they leave all parties open to breach, and they can expose your company to compliance violations. Regulatory fines for data breaches don't distinguish between your mistakes and your vendor's failures.
Risk 4: Advanced Persistent Threats and Nation-State Actors
Cloud environments have become prime targets for sophisticated threat actors, including nation-state groups seeking to steal intellectual property, conduct espionage, or disrupt business operations. Recent high-profile incidents demonstrate the scale of nation-state cloud targeting, including the Salt Typhoon Campaign, which targeted telecommunications organizations in multiple countries over many years. These advanced persistent threats (APTs) often use cloud services to hide their activities and maintain persistent access to target networks.
Nation-state actors have developed sophisticated techniques for exploiting cloud environments, including the use of legitimate cloud services for command and control communications, data exfiltration, and malware distribution. Their activities can remain undetected for months or years, allowing them to steal vast amounts of sensitive information or establish footholds for future attacks.
The global nature of cloud services also creates jurisdictional challenges, throwing up roadblocks for law enforcement agencies who attempt to investigate incidents or apprehend and prosecute alleged attackers.
Cloud Security is Not IT
It bears repeating (and forgive us, because we repeat this often on our blog), CEOs who intend to ensure the resilience of their companies must move beyond viewing cybersecurity, of which cloud security is an integral part, as purely a technical issue. Cybersecurity must be integrated into business strategy, risk management, and operational planning. Working with a partner or with an internal cybersecurity team, CEOs must lead the process of establishing a defense-in-depth security posture. This type of cybersecurity approach encases your business in layers of protection and establishes clear governance structures that ensure appropriate oversight of all security decisions and investments, including the cloud. These security postures include (but aren’t limited to)
Continuous monitoring and threat detection
Investments in tools and processes that provide real-time security visibility
Employee training and awareness programs
Regular security assessments and audits
The Path Forward
As with everything technology-related, the pace of cloud security change is breakneck. The cloud security landscape will continue to evolve as both attackers and defenders develop new capabilities, accelerated as new AI tools continue to flood the scene. CEOs who take a proactive approach to understanding and addressing cloud security threats will be better positioned to realize the benefits of cloud computing while minimizing associated risks.
Success requires effectively managing cloud security risks so that your organization can embrace the benefits that working in the cloud can deliver - moving faster, innovating more effectively, and building stronger competitive advantages. CEOs who take an active role in cloud security governance will ensure that their organizations have the capabilities, processes, and culture necessary to thrive in a cloud-first world.
If you have questions about the risks in your own cloud operations, JSCM Group would be delighted to help. Give us a call or set up a meeting right now for a free consultation.