Today’s business environment, you probably won’t need us to tell you, is more complicated than it has perhaps ever been.
New regulations are constantly coming into effect. There are plenty of issues in relation to personnel management, and technological developments of recent years – such as artificial intelligence (AI) and the Internet of Things (IoT) – have also drastically altered the corporate governance landscape.
The management of these issues and challenges can easily make the difference between your organisation achieving and failing to meet its objectives. This brings us neatly onto the subject of GRC – or ‘Governance, Risk and Compliance’ – and why it is such an integral element for any organisation to put in place in pursuit of its objectives.
What is GRC?
As referenced above, GRC is an acronym referring to governance, risk and compliance. However, simply understanding what each of these separate terms means is not the same as grasping your business’s complete range of GRC requirements.
Putting it simply, an organisation’s GRC strategy can be described as its overall approach to managing governance, risk and compliance according to industry regulations.
The acronym itself was first used as far back as 2003. It was originally coined by the Open Compliance and Ethics Group (OCEG), which has defined GRC as “the integrated collection of capabilities that enable an organisation to reliably achieve objectives, address uncertainty, and act with integrity.”
Another way to see GRC, is simply as a refined process for keeping an organisation “above board”, by instilling good business practices into a company’s day-to-day operations.
Why is governance, risk and compliance important?
As mentioned, GRC as an acronym and concept can be traced back almost two decades. However, it has gained in profile in recent years as business risks have increased in number, complexity, and scope for damage if any such aspect of the organisation’s operations goes wrong.
It is easy to dismiss GRC as a somewhat distant topic that those overseeing a business’s operations ‘on the ground’ have little time or luxury to think about.
Regardless, though, it is difficult to deny that today’s corporate risk landscape is more complex, uncertain, and interconnected than it has ever been. Not only are there more risks than there once was, but any single risk can also impact on many other aspects of the business; the task of keeping on top of this fast-evolving and unfamiliar risk terrain is why GRC is so important and relevant.
Benefits of implementing a governance, risk and compliance strategy in your business
If you are unsure as to whether your organisation should be putting in place a GRC strategy, the safe default answer is probably “yes”. After all, even the smallest businesses engage in some form of risk management, and GRC can offer a number of real-world benefits to the typical organisation.
Those benefits can include the reduction of data silos, for instance, so that important data and strategies are shared across difficult departments within an organisation – thereby helping to maximise visibility and collaboration between those departments.
An effective GRC strategy can also help organisations to identify risks before they manifest into real-world events, or to mitigate those risks if they do occur. This, in turn, can bring real benefit to the company’s bottom line, by enabling it to minimise compliance costs such as audits and fines. In short, taking a proactive approach to pinpointing and tackling threats through the implementation of GRC measures can help your business to save money later.
Another advantage of having a GRC framework in place is its all-around role in improving operational efficiencies, consequently leading to smoother business practices. When you have a unified operational strategy as GRC can help you implement, your teams will probably be able to work more effectively together, finding vital information sooner, and contributing to consistently high-quality operations across your business.
What’s involved in a governance, risk and compliance strategy?
Your company’s GRC strategy is likely to be more successful when you implement it in a holistic way encompassing your entire business. The below components are taken from the OCEG’s open-source model known as the GRC Capability Model, or the ‘Red Book’:
- Learn about the context, culture and key stakeholders of your organisation, to inform your objectives, strategy and actions.
- Align your strategy with objectives, and actions with strategy. This can be done through effective decision-making that takes into account values, opportunities, threats and requirements.
- Perform actions that promote and reward desirable things, while preventing and remediating undesirable outcomes, and detecting important events as soon as possible.
- Review the strategy and actions for their design and operational effectiveness and how appropriate ongoing objectives are for improving the organisation.
Ways to manage governance, risk and compliance using software
As we touched on, technological advances are making a big impact on the ongoing evolution of many businesses’ operations. It is therefore, no surprise that many firms have increasingly turned to technological solutions – such as the renowned Vision software from ACMS UK – as a means of better managing their GRC strategy itself.
The capabilities of the leading GRC software typically encompass all of the following:
- Data collection and logging, with live data being kept in one place and instantly updated
- Document management, saving organisations from having to worry about keeping on top of messy and disorganised paper-based systems
- Audit management, including the creation of bespoke audit templates, the arrangement of internal audits, and email alerts for overdue audits, to help ensure ongoing compliance
- Reporting, such as the production of customised reports built around the requirements of an organisation’s specific GRC strategy
It is important to appreciate, of course, that even the most advanced technology available today cannot entirely take GRC responsibilities off your organisation’s hands; the ethics of your business’s GRC strategy, for instance, encompassing the necessary people and processes, will very much need to be determined and refined by you.
Nonetheless, technological solutions like Vision can still go a long way to minimising the ‘overheads’ associated with the gathering and management of the records a business needs if it is to prove it is satisfying GRC requirements.
Would you like to find out more about the integral role ACMS UK’s Vision platform could play in the management and implementation of your own GRC strategy, at a time when risk and compliance issues are becoming more multi-layered and complex than ever? If so, our team would be very pleased to discuss in greater detail how we can serve you.