Guidelines for governance, risk and compliance (GRC) affect nearly every company in every industry today, with different areas of scrutiny in varying areas of operations. Regardless of industry, however, successful companies reach corporate accountability by proving to stakeholders that their business is reliable, compliant, and sustainable. To achieve this, a unified GRC strategy that guides people, standardizes processes, and integrates technology to embed governance, risk, and compliance must be established.
GRC is about continuous process improvement and sharing information and processes throughout the organization. The foundation of any effective enterprise GRC strategy is a compliance program that integrates efficiency, effectiveness and agility into the operations of an organization. A solid GRC solution benefits an organization with increased shareholder value, improved control and visibility, reduced compliance costs and improved business performance.
The key to success is an equal balance of each of the legs: governance, risk and compliance. All need to work together to create an effective system. Structured processes and risk management procedures will ensure an organization’s operational effectiveness. Through collaboration and sharing of information and processes, a holistic view of risk and compliance can be achieved across the organization.
In order to achieve corporate accountability, organizations need to unify corporate strategy, control initiatives and loss mitigation across the enterprise. Managing GRC across the enterprise allows processes and strategies to be evaluated within the company and extended to partners, suppliers, and customers – truly representing the reach of the enterprise.
According to Forrester Research, the market for GRC spending increased from a $633 billion global market in 2009 to $749 billion in 2010. This spending includes technology costs such as software, hardware and integration, consulting and implementation costs and internal efforts to execute GRC across the lines of IT, legal and audit roles.
What do you think? Have you been more focused on your GRC activities this year? If so, what improvements have you seen? What do you predict for 2011?
The bottom line: GRC requirements are not going to go away or lessen in the future. It’s an opportunity for organizations to streamline governance programs, policies and procedure management, change management, auditing and control processes, and training mandates to ensure corporate governance compliance, and improve accountability and communication and the adoption of corporate governance principles and best practices.
As a result, GRC activities are the foundation for continuous improvement, a cycle that evolves as demands and requirements change. Most importantly, successful GRC practices carefully balance governance, risk and compliance.