Governance, Risk, and Compliance (GRC) is a broad organizational strategy that aims to align an entire organization’s focus on the achievement of business objectives, the management of business risks, and regulatory compliance. A solid foundational framework enables your organization to continue strengthening and refining its GRC strategy over time. It ensures each department’s objectives align with the business as a whole.
However, implementing a GRC framework requires significant time and resources, and the process will vary depending on an organization’s specific needs.
This article addresses how to implement a successful GRC framework that aligns with all departments in your organization.
If you’re already familiar with GRC, skip ahead to our tips on how to implement an effective GRC framework.
What is Governance, Risk, and Compliance (GRC)?
Governance, Risk, and Compliance (GRC) is a strategy that generally covers an organization’s entire governance, enterprise risk management, and regulatory compliance;
Governance
Directing an organization through strategy and policy and implementing the necessary monitoring methods to assess performance and evaluate outcomes.
The main components of governance include:
- Corporate Management
- Strategy Management
- Policy Management
Risk
Identifying, classifying, and addressing all risks related to organizational activities.
The main components of risk include:
- Risk identification
- Risk assessment
- Risk management
Learn how to calculate your risk appetite.
Compliance
Upholding an organization’s ongoing compliance with legal and regulatory requirements.
The main components of compliance include:
- Internal and External Auditing
- Researching
- Security Procedures and Controls
- Reporting
GRC directly involves several different departments and teams, such as:
- Risk and compliance
- Internal audit
- Legal
- Finance
- IT
- HR
- Senior management team
- Board members
Learn more about compliance management in cybersecurity.
How to Implement a GRC Framework
Below are seven tips for implementing a successful GRC framework that drives a comprehensive GRC program throughout your organization.
1. Uncover the Value of Implementing a GRC Platform
Realizing the actual value of GRC implementation is crucial to identifying the existing GRC strategies across different business areas. It also allows you to pinpoint what processes are working and should be retained when creating a unified system.
Similarly, you can remove unnecessary or duplicate data, technologies, or assets that reduce value and would potentially complicate the centralization process.
From here, you can focus on prioritizing your organization’s most profitable assets and focus your efforts on enhancing these in your GRC strategy.
2. Create a GRC Project Roadmap
Focusing your strategy’s scope requires a clear purpose that summarises the main GRC functions of the framework. These outcomes should be the product of ongoing collaboration between all stakeholders to ensure they align with the needs of each department. Understanding the potential benefits of a successful GRC framework can help guide your desired outcomes.
Here are some of the benefits of an effective GRC framework:
- Better alignment between all departments and broader business goals;
- Ensures all types of risk have mitigating processes in place. Such risks include financial risk, legal risk, strategic risk, operational risk, and cybersecurity risk;
- Faster decision-making surrounding business processes and procedures
3. Perform a Gap Analysis
After collating the relevant information on your existing GRC process, you need to determine the following for each:
- Process maturity
- Data quality
- Operational Gaps
Important factors to consider include:
- Identifying any missing or duplicate data
- Identifying any duplicate or redundant processes
- Identifying opportunities for automation or removal of manual workflows
4. Determine and Align Stakeholder Expectations
While often overlooked, ensuring your entire organization is on the same page with your GRC implementation plan is crucial. A well-planned GRC project involves every department. All key stakeholders must have the opportunity to voice their opinions about your proposal.
Broadly, there are two key steps to achieving organizational alignment:
- Aligning executive team members with vital factors, such as budget and roll-out timelines, is the first step in gaining organizational approval. You must ensure leadership is on board with your plan before taking any further action and make any required amendments before informing the rest of the organization.
- Adopting a top-down approach. Once you have executive approval, you need to implement change management processes across all other business units that are realistic and communicated clearly. For example, it’s realistic to expect there will be some resistance to your proposed changes. Departments often have longstanding processes and procedures, which will likely require a gradual phase-out.
To ensure a seamless transition, you should send regular, informative updates to each team, informing them of the relevant changes and how they will affect their respective roles. Create a transparent process for any team members to communicate any concerns, suggestions, or other meaningful feedback that could be necessary cause to amend your strategy.
Learn the importance of executive reporting in cybersecurity.
5. Establish a Robust GRC Strategy Foundation
Laying the proper groundwork is fundamental to ensuring your GRC system is practical and adaptable. These factors are particularly essential in IT GRC due to the dynamic nature of the cyber threat landscape, constantly emerging cyber threats and vulnerabilities, and the harsh consequences of data breaches.
Financial institutions and health organizations must pay even greater attention to ensuring their GRC strategies are adaptable to the frequent regulatory changes their respective industries face.
6. Partner with a GRC Solution Provider
Implementing a GRC program from scratch requires many moving parts, including consolidating information silos, ongoing updates, and using manual processes such as spreadsheets. A GRC platform can streamline many of these pain points, allowing you to focus your implementation efforts on higher-level tasks.
As with any third-party vendor, you must perform due diligence to ensure your chosen GRC tool abides by compliance requirements and does not expose your organization to extreme security risks.
The right GRC technology should yield a return on investment (ROI) through cost and time savings.
Below are important questions to ask when choosing GRC software:
- Is it easy to use/user-friendly?
- Does it use fully-automated workflows?
- Does it allow for customization? E.g., custom reporting
- Is it scalable?
- Do its features perform tasks with the detail you require? E.g., in-depth risk analysis.
- Can it integrate with other third-party software?
- Is it priced within your allocated budget?
7. Standardize Your GRC Strategy
One of the main features of an effective GRC strategy is its ability to align with the entire organization's needs. While each department will have its own specific requirements, there should be a baseline for reference. For example, you can standardize your control framework by implementing an industry standard, such as NIST 800-53 or ISO 27001.
8. Manage and Revise Your GRC Strategy
Launching your new GRC program is not a set-and-forget endeavor. Once implemented, you must ensure your strategy can mature and change in sync with business objectives.
All teams should keep detailed and dated records of their GRC requirements, highlighting any key changes, such as introducing new technologies.
This reporting can be used for reference during regular stakeholder meetings to ensure your whole organization remains aligned with the overall strategy. An audit should be held at least annually to maintain compliance management. You should then prioritize any compliance issues for remediation.
