Governance, Risk and Compliance Software – Building a Boards Eye View
In today’s dynamic and volatile corporate environment, governance, risk and compliance software (GRC) is more important than they have ever been. Failure in this area carries enormous consequences for company reputations, finances and stability. Scrutiny has never been higher. It is the Board’s responsibility to deliver effective leadership on GRC as well as to demonstrate its commitment to a culture of strong GRC management throughout the organisation. In this way, it sits at the head and the heart of a company’s GRC programme, ensuring that it operates successfully within the bounds of legal and regulatory requirements while adopting an acceptable attitude to risk.
Access to accurate, real-time data on the status of the company’s GRC programme is crucial to allow the Board to provide sufficient challenge and oversight. That’s why many organisations are turning to GRC management software to help deliver critical insights and global business visibility.
Digital Transformation Responding to increasing corporate complexity
Modern business is fast-paced and mercurial. A huge number of industries are undergoing digital transformation and facing disruption from start-up competitors. New organisational structures are created, businesses scale and diversify rapidly, and GRC programmes can struggle to keep up.
At the same time, UK businesses operate in an increasingly complex and risk-intensive environment that extends far beyond the historical priorities of financial and regulatory compliance. Cyberthreats, economic fluctuations, operational factors, and environmental and geopolitical issues must all be incorporated into a risk management framework.
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Accompanying increased risk is a rise in the quantity and complexity of regulations that companies must meet, making compliance itself a risk factor. On top of this is an increasing emphasis on direct accountability for company compliance at Board level, meaning that the Board’s own policies and processes are just as much a part of the overall GRC programme as those of the wider organisation.
It’s not just domestic laws and regulations that UK businesses need to consider. The scope of the GDPR is just one recent example where regulation in one territory can have far-reaching effects across the globe. For organisations with an international scope, complying with variations in local law is an additional challenge that must be incorporated into their governance, risk and compliance framework.
Most companies use point solutions to manage risk and compliance in different departments. These range in sophistication from the humble spreadsheet to industry-specific, tailor-made software. Each generates a wealth of data and reports on their particular regulatory environment. The challenge is bringing together all of the distributed information and making sense of it at Board level.
In such a complex and data-intensive landscape, it’s impossible to have a holistic view of governance, risk and compliance without seeking support from technology and automation. As analyst company IDC puts it: “As the data footprint for companies continues to grow and new technologies transform industry, a company’s ability to govern, evaluate, understand and report on its operations is necessarily impacted.” Thomas Kimner, head of risk research and quantitative solutions at SAS, underlines the problem in an excellent article on the challenges of GRC, stating: “Many companies are still approaching governance in a piecemeal fashion. They use various siloed technologies and processes with no centralised technology, programme or oversight. This makes it difficult to fully capitalise on their GRC activities.”
Recognition of these challenges has resulted in a growing demand for enterprise-level governance, risk and compliance software.
GRC Software – Establishing a Global View
GRC software enables companies to seamlessly integrate compliance data from all of the relevant business units into a single framework and management interface. This avoids data becoming trapped in individual silos, with the associated risk of duplicated effort and wasted resources. A systematic enterprise-level monitoring and control system is created with a central dashboard that permits analysis of the company’s status. Audits are simplified and generating comprehensive reports with accurate data for Board review is straightforward.
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Once risk and compliance can be viewed on a holistic level, it is easier to measure and set targets for improvement. When the Board has comprehensive visibility of what today’s picture looks like, it is far better positioned to help senior management visualise goals for tomorrow.
Boosting Corporate Governance Through Digitisation
A great deal of emphasis is placed on the fields of risk and compliance, but it’s essential that the governance element of the equation is not overlooked. To be truly effective, governance must also be managed in a transparent and actionable way, ideally integrated with risk and compliance. If governance is not fully addressed, directors leave themselves in a potentially vulnerable position through failing to manage what is arguably their core function. Boards need to actively demonstrate that their own policies and processes meet the standards that they have set for the wider organisation.
The logical way to approach this is to digitally empower those processes by using Board portals to securely manage Board materials, communications, evaluation and risk management. Together with integrated GRC software, this promotes stronger enterprise governance management in the organisation and closes the ‘governance gap’ that otherwise exists.
Scrutiny of governance, risk and compliance in organisations will continue to increase as the global business landscape becomes ever more complex. Directors who are responsible for navigating their companies through the sea of legislation, regulation and risks will need the support of rich, real-time information so that they can achieve a Board’s-eye view of the challenges that they face.
November 30, 2020
The Technological Revolution: How Technology Drives Innovation in the Boardroom
If the board is not examining its own practices and not looking for better, more efficient and more process-driven solutions to routine tasks, then there’s every chance that such a laissez-faire approach to innovation and forward-thinking will permeate the rest of the business too. As Board Agenda’s Managing Editor Gavin Hicks noted in the recent Diligent/Board Agenda webinar: “Companies that innovate succeed. Those that don't often fail.” So what practices should boards be evaluating to utilise the technological revolution and embrace innovation?
November 10, 2020
What New Digital Workflows Should You Introduce to Your Board?
As a member of the Diligent community recently expressed it: “The silver lining of COVID is it’s making us take another look at our processes and how we can do them better. How could we do them more securely? How could we make things easier for our users?”
November 5, 2020
A Breach in Your Inbox: The Dangers of Unsecure Board Communications
Corporate communications are highly valuable, and protecting them from interception is critical - especially at the board level.