When enterprises develop a governance, risk, and compliance (GRC) framework, they’re able to stay afloat in a sea of scattered data, cybersecurity threats, audit trails, and numerous regulations. A complete GRC framework pulls all information related to enterprise rules and risks into one logical strategy, loops all relevant company stakeholders into the process, and centralizes and automates business responsibilities. Capitalizing on business risks, rather than falling prey to them, is one of the major benefits of a successful GRC framework.
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What is a GRC framework?
A GRC framework is a comprehensive risk management strategy, plan, or foundation that reveals and categorizes all risks an enterprise faces. A GRC framework governs the entire business’s approach to risks and legal expectations. It utilizes both enterprise personnel and GRC software to involve all relevant stakeholders and digitally manage all relevant risks and expectations. These include financial, technological, and human resources risks and industry or federal regulations.
Governance, risk, and compliance provides:
- Organization and structure for developing and enforcing corporate policies
- Audits that reveal financial or security vulnerabilities
- Clear assignments and deadlines for stakeholders who need to complete an audit, scan, or mitigation task
A GRC framework plans for all of these action items, clearly delineating where they’ll fall in the process and what company employees need to do.
Also read: Why is Risk Management Important?
The importance of GRC tools
GRC frameworks are challenging to carry out without software. Many businesses digitize their GRC strategies, automatically tracking what tasks have been completed and storing all compliance information within the platform. These tools streamline GRC processes by:
- Automatically enforcing corporate policies that have been programmed into the software
- Storing previous audits so that users can view the financial data they need
- Sending email or application notifications to stakeholders automatically when a task has a deadline or an urgent security issue arises
Top GRC tools include:
- Fusion Risk Management
- LogicManager
- Riskonnect
- SAI360
- ServiceNow GRC
Features of GRC tools
GRC software features enable businesses to manage a host of governance, risk, and compliance-related tasks.
Compliance management
Enterprises typically have multiple industry standards, and in some cases laws, they must obey when handling business processes or customer data. Compliance management digitizes the process of ensuring they are prepared to meet those regulations by keeping track of each task that needs to be done and updating the system when a new requirement arises.
Risk analysis
A risk management platform lists the priority level for each risk and can be customized to alert company personnel when it notices a particular risk. Risk analysis helps differentiate between beneficial risks and harmful ones.
Audit management
Automating audits, both internal and external, takes manual work off employees’ hands and allows enterprises to better manage every audit trail in the business.
Single pane-of-glass management console
This feature is what really allows GRC tools to work: all of the data they need is available in one management console, not stored on multiple applications or devices that they have to constantly travel between.
Also read: Top Governance, Risk, and Compliance Tools
How to develop a GRC framework
First, ensure that executives are not only on board with designing a GRC strategy, but will also be active participants in the process. Having executive buy-in will increase the likelihood that when issues arise, they’ll be dealt with more readily. All employees that are involved in a GRC strategy should also be notified and brought into the process as necessary, such as IT and security staff, finance teams, and human resources leaders.
Then, determine a single governance system and solution for ranking risks. Finding a common language to determine all GRC processes is crucial, according to Vasant Balasubramanian, the GM & VP of risk at ServiceNow. “The biggest step any organization can take in developing a successful GRC strategy is to agree upon a common language and taxonomy,” he said. “Once established, this foundation will support the organization’s strategy, people, processes, and technology. It will allow chief risk officers, chief legal counsels, and chief information officers to align on what constitutes a low, medium, or high risk and respond accordingly.”
After determining a business-wide taxonomy, research and select a GRC tool. Finding the software that best suits your business needs allows you to notify team members quickly when an issue arises, automate processes like audits and policy enforcement, and manage regulatory compliance step by step.
Next, design a long-term plan to have regular meetings with the stakeholders and executive team members involved in the GRC framework. A successful GRC strategy needs to be continually monitored so that the company can report progress and problems and make adjustments to fit their business’s development.
Read next: Best Risk Management Software
