The hidden software security risks business leaders should be aware of
In this article
Summary
Most cyberattacks don’t start with advanced hackers: they start with weak software. Yet, many organizations still treat cybersecurity as a final checkpoint rather than a foundational priority.
This article explores how software security risks originate early in development and why proactive governance is essential for business resilience.
You’ll learn:
- Where software vulnerabilities are introduced—and why they’re often overlooked
- How poor code quality and open-source dependencies quietly increase risk
- Why reactive measures like penetration testing aren’t enough on their own
- What executives can do to uncover and mitigate risks before they become strategic failures
The growing software security risks for business
The world of business has become synonymous with tech—from cloud storage and e-commerce to digital marketing and in-house operations, IT is the backbone of global business.
But as organizations lean more on tech, they’re also increasingly exposed to software security risks. Cybercrime is growing, fast. The EU sees 10 terabytes of data stolen each month, a third of UK businesses report yearly attacks, and the average cost per breach is a resounding $4.45 million.
However, many organizations treat security reactively, addressing it only after an attack or once the software is already in production.
To build long-term resilience, executives need to understand how security risks can originate in the early stages of software development and understand how to mitigate them before they become a threat.
In this article, we’ll break down the root causes of software security risks: where they come from, how to mitigate them early, and how a proactive approach saves time, money, and asserts business continuity.
How are software security risks introduced?
It’s easy to picture cybercriminals as highly sophisticated individuals, always one step ahead, forcing businesses to scramble in response.
The reality? Hackers need an entry point.
And those entry points are often hidden in your source code.
Source code: The foundation of your software
Every piece of software we use is built on source code, (and yes, that also means AI systems). There are, of course, a lot of technical nuances and differences, but for simplicity’s sake, let’s compare software engineering to constructing a building.
Engineering a building involves planning, designing, constructing, and maintaining a structure, encompassing everything from structural integrity to the systems that make it habitable. Building engineers focus on the technical aspects, working with architects and other professionals to ensure the building’s functionality, safety, and efficiency.
Like a building’s foundation, the way the source code is written determines the strength and security of the finished product. The reason? When software is poorly structured, it’s difficult to understand, modify, and test, making it more difficult to identify weaknesses, add preventive measures in all relevant locations, and maintain those preventive measures.
Things like outdated dependencies, weak encryption, and coding errors all create exploitable gaps for attackers. Sure, firewalls, intrusion detection, and threat monitoring all have a role to play, but they don’t mean much if the software is built on a shaky foundation.
In our State of software 2025 report we found that poor software quality strongly correlates with a higher number of security vulnerabilities. In fact, Software systems that have an above-market-average build quality (a high maintainability rating) are twice as likely to have strong security compliance.
The weaker the code, the more vulnerable the software.
Security flaws don’t magically appear later in a product’s lifecycle. Many are present from the start. Sometimes code has vulnerabilities because developers are simply not aware, other times they apply sloppy coding practices, human error, or take shortcuts to accelerate time-to-market.
The average amount of security findings per system
At Software Improvement Group we look at security risks in software by thoroughly analyzing the source code and infrastructure of a system, we then map these findings against the OWASP top 10. A globally recognized and annually updated list of the ten most critical web application security risks.
Very important to mention here is that a high-security rating indicates that security considerations have been factored into the design and implementation, making vulnerabilities less likely, not impossible.
In our State of software 2025 report, we found that it’s not uncommon for an average-sized software system to have 19 critical security findings. Of course, even a critical security finding doesn’t necessarily turn into a breach, but with, the average breach costing $4.88 million, why take the risk?
Mitigating security risks early in the development process can help avoid things like costly breaches, business disruption, and reputational harm.
And it’s not just your own code you need to worry about.
Open-source software accelerates development—but it also expands your attack surface
While the source code you develop in-house is closed, open-source software is software with source code that anyone can inspect, modify, and enhance.
Open-source software (OSS) is everywhere, and for good reason. It enables faster development, lower costs, and greater flexibility.
For years now, open-source software (OSS) usage has been on the rise. According to the 2025 State of Open-Source Report, 59% of organizations increased their use of OSS over the past year. However, it also introduces hidden risks if not properly managed.
In our 2023 Benchmark Report, we found that:
- 50% of enterprise software systems are vulnerable due to security issues in open-source libraries
- 30% of systems contain at least one critical vulnerable dependency.
Hackers often exploit popular libraries or inject malicious code into public repositories, waiting for businesses to adopt compromised components.
During an ask-me-anything session, our Senior Consultant, Jan Laan mentioned the appeal of open source vulnerabilities for attackers.
“A popular open-source package is used millions of times so if you find an exploit in open source, you may be able to exploit thousands of systems at once.”
– Jan Laan, Senior Consultant at Software Improvement Group.
To manage this, organizations need regular Software Composition Analysis (SCA) which scans dependencies for vulnerabilities, licensing issues, and legal risks.
The most dangerous misunderstanding about software security risks
Security in software is treated as a final checkpoint, not a continuous priority. This mindset leaves systems exposed and expensive to fix.
A common misconception persists: “We do penetration tests, so we’re secure.”
While penetration testing (pentesting) is important, it typically happens late in the development lifecycle. By the time issues are discovered, the damage may already be done or require costly rework to resolve.
This is exactly what Yiannis Kannellopolus, founder and CTO of code4thought mentioned during our webinar ‘Avoiding a false sense of cybersecurity’
The multi-layered approach to cybersecurity
To establish a strong cybersecurity posture, organizations need a layered approach that combines multiple security measures.
Three key methodologies in software security testing include:
- Penetration Testing (Pentest): Simulates external attacks to uncover vulnerabilities.
- Static Application Security Testing (SAST): Analyzes the source code to detect weaknesses before deployment.
- Software Composition Analysis (SCA): Scans third-party open-source libraries and dependencies for known vulnerabilities.
No single method is enough on its own.
Both SAST and SCA are complemented by penetration testing to form a complete security assessment. Together, these techniques enable earlier detection, stronger compliance, and more secure software from the start.
Why cybersecurity matters to business leaders
Cybersecurity isn’t just the CTO’s job. Understanding the link between software quality and security allows all executives to:
- Ask smarter questions
- Justify investments in secure development
- Reduce long-term costs
Identify security vulnerabilities in your software before they become threats
Uncover hidden security risks across your entire software landscape—before they escalate into costly breaches, regulatory issues, or reputational damage.
Our Software Portfolio Scan gives you full visibility into your organization’s software security posture. By combining deep code analysis with global benchmarks and OWASP-based risk mapping, we help you assess where your risks lie—and what to do about them.
Want to learn more? Download our free Software Portfolio sample report today.
