Wednesday, January 11, 2023

What Is Governance Risk Management And Compliance

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Introducing Grc To Your Business

Integrated Governance, Risk and Compliance (GRC)

So youve been won over by the benefits listed above? Then its time to start thinking about how you can introduce GRC to your business in a way that will maximize the positive impact and minimize any potential disruption in the implementation period. This GRC Guide is here to spell out the people you need to have involved, what their roles need to be and and the steps you need to take to make GRC strategies and tools work for you.

Where Did The Term Grc Come From

The term GRC originated in the early aughts, although its origins are a little murky. The OCEG writes that its membership came up with the GRC acronym as a shorthand way of referring to the important capabilities that allow an organization to manage its overall governance, enterprise risk management, and compliance with regulations. Michael Rasmussen, the âfather of GRC,â is also credited with coming up with the acronym when he was an analyst for Forrester in 2002.

Whatever its exact provenance, GRC was a reaction to a need for better controls and internal governance in large organizations in the early 2000s, and driven by the compliance requirements of the Sarbanes Oxley Act of 2002, and debacles like the Enron and WorldCom scandals, which showed the world just how much internal controls at large enterprises needed to be improved.

GRC evolved as a way to help organizations meet compliance, manage risk and provide internal governance.

Itâs important to note that GRC is a strategy, rather than a platform, digital solution or any other set of tools. An organization builds a framework so that the organization can take a structured approach to managing risk, meeting compliance and maintaining governance over every area of IT.

What Is Risk Management

One of the functions of a corporate governing body is to identify, address, and prevent potential risks to the company. There are a number of things that can pose a risk to a business and being able to manage those risks is part of a comprehensive enterprise risk management strategy.

Enterprise risk management is a business strategy designed to identify, assess, and prepare for any dangers, hazards, and other potentials for disaster that may affect an organization’s operations and objectives.

Risk management is a complicated job that requires multiple stakeholders and involvement from different departments because of this, most companies will employ a third-party risk management consulting agency or an operational risk management software.

Regardless of how you choose to manage your risk management strategy, its important to have one in order to ensure the longevity of your business. Being prepared for any potential problems will help your company succeed in the long-run.

Discoverhow your company can benefit from a risk management software solution.

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Integrated Grc Programs Statistics

Is it time to restructure everyday business practices at your company? Are your compliance risk management methods outdated?Many executives seek better implementation of GRC activities at their organizations. Take a look at a few head-turning integrated GRC approach statistics

57% of senior-level executives rank risk and compliance as one of the top two risk categories they feel least prepared to address.

Only 36% of organizations have a formal enterprise risk management program or GRC software.

69% of executives are not confident that their current risk management policies and practices will be enough to meet future needs.

62% of organizations have experienced a critical risk event in the past three years

44% of organizations plan to implement or expand/upgrade their existing implementation of GRC software or risk management software

Where does your company fall in these statistics? Does your organization also feel unprepared to address risk and compliance? Dont wait too long before implementing GRC practices to help your organization achieve its goals. Partnering with a RegTech company like compliance.ai to assist your business with a strategic GRC program is advised for achieving principled performance.

What is RegTech?

Benefits of Compliance Risk Governance withCompliance.ai Software

Deliver transparency and streamline your transition
Scan the horizon and filter out the noise
Analyze impact and take action
Initiate workflows and break down silos

What To Ask Before You Consider Grc Software

Governance, Risk, and Compliance (GRC)  Vistrada

Ask if the GRC software is built to scale. An organizations risk profile is unique to their people, processes, industry, locations, and regulatory environment. And risks and compliance requirements change on a continuous basis. Smart companies purchase software that can grow and adapt with them as their needs diversify within a changing market and regulatory environment. While they may not require every element of a GRC software solution today, assurances of capacity and configurability can provide confidence that the GRC solution will remain viable and valuable in the long run.

Ask about integrations. . Most organizations have some degree of software investments already in place when they acquire a GRC solution. In some cases, these solutions are more intrinsic to how the organization operates than the GRC solution will be, and therefore, the buyer will have expectations on whether and how the GRC solution can fit within their existing software solutions. Can it work in conjunction with SharePoint, can it deliver reporting through a BI tool, can it integrate with an existing component of another GRC solution, delivering a more holistic experience?

When evaluating a GRC vendor, especially as it is selling a methodology for good governance, risk awareness, and good conduct, it makes sense to ask about its own GRC practices and performance. Do they believe in what theyre saying?

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How Can Aws Help With Grc

AWS Cloud Operations optimizes cloud resources with business agility and governance control. You can manage dynamic resources on a massive scale and reduce costs.

For example, with AWS Cloud Operations, you can perform the following tasks:

  • Govern, grow, and scale AWS workloads in one place
  • Ensure your risk management process stands up to an audit
  • Automate compliance management to remove human error

Focus On Collaboration And Crowdsourcing

When it comes to risk management and compliance, knowing is half the battle. Instead of fighting risk individually, companies are coming together to share risk information and signatures from the front lines. Access to real-time risk intelligence enables you to identify new and evolving risks like zero-day attacks and fileless malware before they infiltrate deep enough to cause lasting damage.

Crowdsourcing risk data enables your risk managers to analyze the efficiency of various controls and remediation strategies. They can then retrofit existing controls or amp up their efficiency to deal with new threats. With further advancements in the field of data analytics, the benefits of fighting risk as a unified collective will only increase.

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Whats Driving Interest In Grc

Todays risk landscape is more crowded, uncertain, and interconnected than ever. One risk say a health and safety issue can spill over to supply chain, business continuity, business relationships, IT security, workforce productivity, and more. At the same time, multiple forces are reshaping the risk terrain, including:

  • Rising pace and scope of regulatory complianceVirtually every organization in every industry is facing an ever-growing and ever-changing number of regulations with which they must comply.
  • Accelerating digitization of risk managementThe internet of things, third parties, blockchain every new point of access adds vulnerability and increases risk exponentially.
  • Growing importance of risk management in corporate strategyRisk management is increasingly viewed not just as a tactical function, but as a valuable part of corporate strategy.
  • Evolving sophistication of analyticsBetter analytics are delivering new levels of insight for data-driven decisions.

The influence of social media, constant threats of cyberattacks, and demands for greater transparency also are amping up the pressure on executives and boards to make wise decisions about risk at an accelerated pace with little room for error. Senior leaders, in turn, are relying on an increasing number of stakeholders from all corners of the organization to identify, manage, and reduce risk.

Set Clear Roles And Responsibilities

2021 Governance, Risk and Compliance – Introduction

GRC is a collective team effort. Although senior executives are responsible for setting key policies, legal, finance, and IT personnel are equally accountable for GRC success. Defining the roles and responsibilities of each employee promotes accountability. It allows employees to report and address GRC issues promptly.

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How Manual Siloed And Ineffective Grc Can Impact Your Business

  • Costs can increase
  • There is a lack of visibility into possible risks
  • Time-consuming process to generate board level reports means stale data, which results in the inability of executives and the board to provide proper direction and scrutiny
  • Third party risks are not properly addresses
  • There is difficulty measuring risk-adjusted performance
  • There are too many negative realizations that lead to:
  • With no shared language, people waste time on low priority issues
  • Productivity suffers due to time-consuming processes
  • Cumbersome and unfamiliar user experiences are business disablers creating disengaged front line employees
  • Inability to effectively collaborate across departments

How Hiring Affects Grc Implementation

An effective GRC program isnt built overnight. However, being aware that changes need to be made within your organization is the first step towards sustained success. Whether you have a head start on your GRC journey, or youre just starting out, its important to look at the big picture.

Who you hire matters.

The first step in doing so is to define your organizations GRC vision, goals, success criteria, roles and responsibilities, the types of solutions that can be implemented, and milestones for success. Remember, effective GRC is an enterprise-wide activity. Each team member must effectively manage their tasks independently while working in tandem, leveraging your risk-control framework. Everyone needs to speak the same language and work in harmony, functioning like a well-oiled machine.

So, how do you start to close the gaps? To connect the dots between risks, compliance, and other elements of your GRC strategy, its recommended that you consult with industry experts. Whether you seek advice or are ready to hire a GRC executive, Locus Recruiting can help.

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Risk Identification & Evaluation

Organisations are increasingly expected to demonstrate that they have effectively evaluated the risks they are exposed to and have put appropriate controls in place to protect the organisation.

We work with you to identify these risks and evaluate their potential threat to your organisation.

RSM can assist you in the following ways:

  • Assist you to determine your risk appetite and risk maturity, and to create, implement, and maintain a risk management framework suitable to your needs
  • Prepare a comprehensive risk management strategy, covering your people, your information systems, and your processes
  • Risk assessment facilitation through risk workshops
  • Risk identification and evaluation
  • Risk register compilation and maintenance, including risk and control mapping and business process mapping

Social media platforms have billions of active users across the globe, so its no surprise that organisations are looking to take advantage of this, both from a marketing and an e-commerce standpoint. However, utilising these platforms opens an organisation up to a number of risks through unauthorised or negative posts. Social media policies play a key role in mitigating these risks.

Some of the key risks include:

  • Reputational damage
  • Disclosure of unauthorised or sensitive information
  • Dissemination of false information

RSM can work with you to develop a tailored controls assurance framework that aligns to your business objectives and complies with your regulatory requirements.

This includes

What Is The Intelligent Enterprise

GOVERNANCE, RISK &  COMPLIANCE (GRC)

Intelligent Enterprises are organizations that apply advanced technologies and best practices within agile, integrated business processes to run at their best . They achieve this by integrating data and processes, building flexible value chains, innovating with industry best practices, understanding and acting on customer, partner, and employee sentiment and managing environmental impact with an intent to grow more resilient, more profitable, and more sustainable.

At SAP, we have focused on 4 end-to-end processes to enable transformation to the Intelligent Enterprise:

* Lead-to-Cash which covers the entire business process from initial contact with a prospective customer, to order fulfilment and service delivery

* Recruit-to-Retire where the intent is to help organizations understand, manage, and optimize all aspects of their workforce in line with business objectives

* Design-to-Operate which encompasses the entire lifecycle ranging from design to planning, manufacturing, delivery, and operations and the focus of this blog

* which concentrates on optimizing, simplifying, and effectively managing all spend processes and spend categories.

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What Are The Common Challenges Faced By Organizations When Adopting A Governance Risk And Compliance Framework

While implementing a GRC framework, it is common for organizations to face certain challenges. Identifying such challenges in advance can help organizations be prepared and take adequate steps to address them. Listed below are a few common challenges.

Managing change – The very element that makes GRC implementation difficult is also its greatest driver. Organizations are always exposed to several variables within and outside their systems. For example, with the pandemic, the workforce and its operations have changed significantly, growth forecasts are tentative, and leaders are being asked to make several important, often interdependent and quick decisions. When implemented robustly, a GRC framework can help provide the data that enables faster, better decisions even in uncertain scenarios. A comprehensive GRC framework needs to be implemented along with a robust change management program.

Senior Management Should Be Fully Onboard

The benefits of a unified GRC approach should be clear to any members of senior management. After all, it means better access to reports, analytics and evidence which help shape strategic decisions. Plus, improved risk management processes mean those strategic decisions are well-informed in the first place.

Senior management should provide a clear idea of the organizations overall aims and strategy, which in turn will set the tone of the GRC project. If the board can decide on a unified GRC strategy, it will be easier to embed the project in the wider organization.

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How Solutions For Governance Risk And Compliance & Security Can Help

GRC solutions are not at the core and heard of Industry 4.0 of course. This would be the solutions from SAPs Supply Chain Management portfolio. Nevertheless, SAP solutions for Governance, Risk, and Compliance & Security can help secure the Design-to-Operate process and mitigate the risks identified earlier in this blog.

Summary of selected risks from the Design-to-Operate process

For the Idea to market subprocess, SAP Data Custodian gives organizations control of their data by enforcing data protection policies. Access control and data masking for instance enables the creation of contextual access control policies to block access to specific applications and mask sensitive data under given conditions. To provide an additional layer of data protection including preventing unauthorized access by cloud providers, organizations can also leverage the Key Management Service to control their own encryption keys.

In Plan to fulfill, SAP Watch List Screening helps companies avoid high-risk businesses, individuals, and entities by screening their business partners against restricted or denied party lists flagged by governments and institutions like the United Nations or World Bank for instance. This simplifies 3rd party compliance and reduces the cost and effort of associated due diligence activities

PS: you can find the other blogs in this GRC and Intelligent Enterprise processes series listed below:

Defining Governance Risk And Compliance

What Is Governance, Risk and Compliance (GRC)?

Putting it simply, Governance, Risk, and Compliance refers to a companys overall strategy and approach to ensuring that its governance, risk management, and compliance policies are in line with industry standards.

Three factors make up the scope of governance risk and compliance framework:

  • Governance: assumes an oversight role and how businesses manage and minimize their risks.
  • Risk Management: enables a company to assess all of its business and regulatory risks and controls and keep track of all of its mitigation efforts systematically.
  • Compliance: ensures that a companys procedures and internal controls are adequate to meet the requirements of government agencies, regulators, industry standards, or internal rules.

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Grc And Intelligent Technology Solutions

Artificial Intelligence technologies which include machine learning, advanced or augmented analytics, and predictive analytics are increasingly being used to transform risk management and regulatory technologies . The ability to process, analyze, and learn from large, fast-changing data sets gives GRC professionals the ability to augment their human skills, use real-time analytical insights, and better visualize their immediate situation across multiple scenarios.

Robotic process automation is a crucial tool in building more robust and effective compliance programs. RPA supports continuous control monitoring as well as full sample-auditing. This makes it easier to detect risks and anomalies. RPA tools also help to automate and streamline the repetitive and often voluminous administrative tasks associated with ERM and compliance. Blockchain adds additional power to GRC systems due to the security and immutability of its transactional records. Acting as a single source of truth, blockchain also minimizes risk in more hands-on areas of the business by ensuring accurate provenance of materials and goods and their payment records from anywhere in the world. As risk and compliance challenges grow more complex, intelligent technologies deliver the confidence and reliability to manage whatever the future brings.

Risk Management And Grc Security

Risk managementinvolves identifying, assessing and controlling threats and risks to the organization. These threats could be financial pitfalls, legal consequences, cybersecurity threats, commercial liabilities, management errors and even natural disasters and other accidents.

Risk management processes typically rely on internal audits and risk assessments to identify critical gaps and areas of significant uncertainty. Risks can be found internally, within essential business operations and processes, or externally, out on the broader market.

Organizations often task many individuals with various elements of risk management, including IT security leaders, business analysts, finance officers and the governance board. A robust GRC framework can help ensure that all risk management activities are aligned with the organizations ultimate goals and objectives.

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