CYBERSECURITY BREACHES AND STOCK PRICES IN WEST AFRICA

ABSTRACT 10 Cybersecurity breaches increasingly jeopardize firm value and investor confidence, especially in emerging markets. This study assesses how announced cyber incidents impact stock performance among listed telecommunication firms in West Africa—specifically Nigeria, Ghana, Senegal and Côte d’Ivoire. Employing an event‑study methodology, the research analyzes daily stock returns using a market model over a 120‑day estimation window, focusing on a narrow event window (–5 to +5 days post‑breach). Key variables include short‑term abnormal returns, cumulative abnormal returns, and firm compliance with cybersecurity standards. The findings reveal consistently negative abnormal returns immediately following breach announcements, averaging declines of 3–5%, closely mirroring global trends. The severity of stock impacts is significantly mediated by breach characteristics—such as data theft or downtime—and by firms’ adherence to standards. Firms with documented compliance exhibit faster reversals and shallower price drops, demonstrating effective risk mitigation. Long‑term analysis shows mixed outcomes, while half the firms recovered within six months, others suffered sustained valuation losses, particularly those with repeat or severe breaches—highlighting a “trust erosion” effect. These results have critical implications for regulators, investors, and telecom organizations. They underscore the need for stronger cybersecurity policies, transparent breach reporting, and investor-focused communication strategies to enhance market confidence. Future research should explore the role of cybersecurity insurance and board‑level governance in modulating market reaction. Overall, the study affirms that cybersecurity breaches materially influence firm valuation in West Africa, reinforcing the vital role of cyber resilience in emerging market corporate finance.