17 January 2020 AnkitChadha

Definition, Importance & Benefits of GRC

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GRC is the acronym for Governance, Risk and Compliance, but the complete story is much larger. It refers to overall competence in terms of achieving elevated performance - the competency that brings together governance, management, performance, compliance and the multi-levels of risks associated with it. Internal Audit, Compliance, Risk, Legal, Finance, IT, HR, The Business and The Executive board all fall under the regulations of GRC. The term GRC ( Governance, Compliance and Risk ) was concocted by OCEG ( Open Compiance and Ethnic Groups ) for the International Journal of Disclosure and Governance, altering the software and services industry completely.

 

GRC intends to develop a framework that supports and enables operations of the IT sector, leadership and the organization to meet their strategic goals. It regulates the organization’s actions with the bigger organizational targets (Governance) by allowing the recognition of opportunities and challenges (Risk). Internal stipulations and external directives are matched (Compliance), the organization achieves success.

 

Why is Governance, Risk and Compliance important?   

The regulatory norms are ever-changing in today’s business world. There is an increase in the level of alertness for Governance, Risk Management and Compliance as it has become a necessity for the essential nature and the lifespan of a company. A few factors that businesses have to deal with are:

  • High performance with a high level of transparency demanded by stakeholders.
  • Regulations, norms and impositions are dynamic and erratic in today’s world.
  • Third-party relations show an aggressive growth where managing risk is a challenge.
  • Devoting effort to address risks and the requirements have a huge bearing on costs.
  • The aftermath of not identifying opportunities and threats leads to alarming results.

 

Execution of GRC

The maxim of GRC is to support and enhance the performance of any business. A need to make a strong business portfolio for assimilation, creation of a workflow that brings together all policies, mechanisms and supervision is  the reason why companies cover GRC.

 

  1. GRC, when done right:

The logic behind incorporating GRC functions is not the creation of  a GRC administration. Neither is there a restriction to use only one GRC software system for all business activities. Relatively, GRC is all about creating a plan that provides the right objectives and to make sure that appropriate actions and controls are taken. This removes any notion of uncertain risks. Here are some benefits of GRC.

  • Cost Reduction
  • Duplicacy of activities reduced.
  • Operational impacts get reduced.
  • Better quality of information is accomplished.
  • Puts into motion the capability to collect faster and efficient information.
  • Obtain a greater capacity for repetitive tasks in a dependable manner.

 

  1. GRC, when done wrong:

According to GRC Maturity Survey, confused or incoherent GRC exercises cause multiple problems. Addressing these problems develop departments and plans like risk management, performance management, compliance, corporate social responsibility, etc. Here’s what can happen if GRC isn’t executed right.

  • High Expenditure.
  • In terms of risks, there is an absence of clarity.
  • Failure to recognize and enact on  third party risks.
  • The element of unforeseen motions.
  • Difficult to execute successful counter-productive objectives.

 

  1. Trends in relation to GRC.

It has been 15 years since the emergence of GRC and, a lot has changed in the landscape. What was once a separate drive is now more entangled than ever. The world of business is evolving continuously and is enhancing its awareness to prevail over any new challenges or risks. Increased risk also brings opportunities, and businesses turn towards GRC professionals for guidance. Here are some trends to drive high performance.

  • The ultimate regulators are consumers.
  • Deliverance of Instant Values.
  • The assurance of Artificial Intelligence.
  • Successions of high profile breaches have opened a pathway for Operations Risk Management ( ORM ).
  • Accountability drives organizational integrity.

 

  1. Predictions in terms of GRC.

The future of GRC? A lot is in store for the GRC landscape. The evolution of Governance, Compliance and Risk is going to continue. Experts have made predictions too. Some of these are:

  • Enhancement for Data Privacy
  • Cyber Security Breaches will continue.
  • Business Operations will be resilient.
  • GRC technology to be backed by advanced AI contributions.
  • Companies may be held liable for third-party vendor or supply chain actions in relation to data security.

TRC Consulting delivers ideal custom made packages taking into consideration your business requirements. We partner with your business and help you achieve your objectives in an efficient and effective manner. For further questions or understanding, get in touch with us.