Keeping up with evolving regulations, cyber threats, and business risks is becoming increasingly complex for organizations. With new compliance mandates emerging and risks evolving rapidly, organizations need more than just a reactive approach. They need a structured framework to govern processes, mitigate risks, and ensure compliance—this is where Governance, Risk, and Compliance (GRC) comes into play.
A well-implemented GRC strategy not only helps businesses stay compliant but also strengthens security, improves decision-making, and enhances operational efficiency.
The growing adoption of GRC solutions reflects their increasing importance. According to Technavio, the GRC platform market is projected to grow by approximately $44.2 billion between 2025 and 2029, with a compound annual growth rate (CAGR) of 14.2%. This surge highlights how businesses are investing in GRC not just as a regulatory necessity but as a strategic enabler for risk management and resilience.
In this blog, we’ll break down what GRC truly means, why it is essential for modern businesses, and how organizations can implement an effective GRC framework to stay ahead of regulatory challenges and operational risks.
What is Governance, Risk, and Compliance (GRC)?
GRC is a structured framework that helps organizations align operations with business goals, manage risks, and meet regulatory requirements. Introduced by the Open Compliance and Ethics Group (OCEG) in 2002, it standardizes governance, risk management, and compliance.
In cybersecurity, GRC safeguards digital assets, ensures compliance, and mitigates threats. It involves policy development, risk assessments, audits, and continuous monitoring. Integrating GRC strengthens security, enhances accountability, and builds resilience against evolving threats.
What are the components of GRC?
GRC is built on three core components, each crucial to ensuring a well-structured and resilient organization.
Governance
Governance refers to the set of policies, procedures, and frameworks that guide an organization in achieving its objectives while maintaining accountability. It ensures that business operations align with strategic goals, regulatory requirements, and ethical standards. Effective governance fosters transparency, decision-making consistency, and stakeholder confidence.
Risk
Risk management involves identifying, assessing, and mitigating potential threats that could disrupt business operations. These risks may arise from cybersecurity vulnerabilities, financial uncertainties, legal obligations, or operational inefficiencies. A strong risk management strategy helps organizations anticipate potential issues, develop contingency plans, and minimize their impact on business continuity.
Compliance
Compliance ensures that an organization adheres to industry regulations, legal requirements, and internal policies. It involves monitoring regulatory changes, conducting audits, and implementing controls to avoid penalties or reputational damage. Strong compliance programs help organizations maintain trust, avoid legal risks, and operate ethically within their respective industries.
Why is GRC important for business today?
Businesses today are facing a sharp rise in cyber threats alongside increasingly stringent compliance requirements. Cyberattacks surged by 30% in the second quarter of 2024, averaging 1,636 weekly attacks per organization.
In response, governments and regulatory bodies worldwide are strengthening cybersecurity measures, with initiatives such as the European Union’s NIS2 Directive, Singapore’s Operational Technology Cybersecurity Masterplan, and India’s Digital Personal Data Protection Act (DPDPA) being just a few examples of these efforts. These developments underscore the necessity for a structured framework to ensure accountability and resilience.
Here are the main benefits of GRC in business:
1. Enhanced risk management and compliance
A well-implemented GRC framework helps businesses proactively identify, assess, and mitigate risks while ensuring compliance with evolving regulations. By staying ahead of legal and security requirements, organizations can minimize the risk of data breaches, financial penalties, and reputational damage.
2. Improved decision-making and strategic alignment
With a centralized GRC approach, businesses gain real-time visibility into risks, compliance gaps, and security challenges. This enables leadership to make data-driven decisions that align with long-term business goals while addressing regulatory expectations.
3. Operational efficiency and cost savings
By automating compliance workflows and streamlining risk assessments, GRC reduces manual efforts, eliminates redundancies, and optimizes resource allocation. This leads to cost savings and improved overall productivity.
4. Strengthened reputation and stakeholder trust
Organizations that prioritize governance, risk, and compliance demonstrate accountability, fostering trust among customers, partners, and regulators. A strong GRC program helps businesses maintain a positive reputation and competitive edge in an increasingly regulated market.
What does a GRC implementation process look like?
A successful GRC implementation requires a structured approach that aligns governance policies, risk management strategies, and compliance requirements. It ensures accountability, enhances operational resilience, and streamlines regulatory adherence. Below are the key steps in implementing a GRC framework.
Businesses can build a resilient GRC framework that strengthens compliance, mitigates risks, and improves operational efficiency. Six key steps in GRC implementation:
1. Assess current state and define objectives
Evaluate existing governance, risk, and compliance processes to identify gaps and set clear objectives that align with business goals.
2. Establish a governance structure
Define roles, assign responsibilities, and set oversight mechanisms to ensure accountability in risk and compliance management.
3. Develop policies and controls
Create governance policies, risk management procedures, and compliance controls that align with regulatory standards and operational needs.
4. Implement a GRC technology solution
Leverage GRC software to automate compliance tracking, risk assessments, and governance workflows for improved efficiency.
5. Train employees and foster a risk-aware culture
Educate teams on GRC policies, security best practices, and compliance requirements to ensure organization-wide adoption.
6. Monitor, audit, and continuously improve
Conduct regular risk assessments, audits, and governance reviews to adapt the GRC framework to evolving risks and regulations.
When does your organization need GRC?
Not every business requires a GRC framework from day one, but as companies grow, handle sensitive data, or operate in highly regulated industries, the need for structured governance, risk management, and compliance becomes crucial.
Certain industries have strict regulatory requirements that mandate GRC compliance, while others benefit from its structured approach to risk management and operational integrity.
others benefit from its structured approach to risk management and operational integrity.
Here’s a breakdown of industries where GRC is essential or highly recommended.
| Industry | GRC requirement | Some regulations to be followed |
| Cybersecurity | Highly recommended | ISO 27001, NIST CSF, SOC 2 |
| Finance and banking | Mandatory | Basel III, SOX, PCI DSS |
| Healthcare and pharma | Mandatory | HIPAA, HITECH, GDPR, FDA, EMA, GxP |
| Manufacturing and supply chain | Highly recommended | ISO 9001, CMMC, ESG reporting |
| Government and defense | Mandatory | FedRAMP, CMMC, NIST SP 800-171 |
| Retail and e-commerce | Highly recommended | PCI DSS, GDPR |
| Energy and utilities | Mandatory | NERC CIP, ISO 14001 |
Is the GRC solution the same for all kinds of businesses?
No, GRC solutions vary by industry, company size, and risk profile. Regulated sectors like finance and healthcare require strict compliance (e.g., PCI DSS, HIPAA), while startups may focus on ISO 27001 or SOC 2. Large enterprises need complex, integrated solutions, whereas smaller businesses prefer scalable, streamlined approaches. Tailoring GRC ensures alignment with unique risks and compliance needs.
Who is responsible for implementing GRC in an organization?
GRC implementation is a shared responsibility across multiple roles. Typically led by the CCO, CRO, or CISO, it requires collaboration across legal, IT, finance, and operations. Senior leadership sets governance, while risk and compliance teams develop policies and monitor risks. Employees also contribute by adhering to policies and reporting risks, making GRC an organization-wide effort.
What is the OCEG GRC capability model?
OCEG developed the GRC Capability Model as a framework for organizations to integrate governance, risk management, and compliance into a cohesive strategy. This model provides a structured approach to aligning business objectives with regulatory requirements and risk management processes while promoting ethical decision-making.
Key components of the OCEG GRC capability model
The OCEG GRC capability model emphasizes the need for continuous improvement, transparency, and accountability across all organizational levels. It is structured into four key components, each guiding organizations in implementing GRC practices effectively.
1. Review – Continuously monitor, audit, and refine GRC processes to adapt to regulatory changes and improve efficiency.
2. Learn – Gather information on risks, regulations, and business goals through risk assessments and compliance monitoring.
3. Align – Establish governance structures, policies, and accountability to align GRC with business and regulatory needs.
4. Perform – Implement GRC strategies by integrating risk management, compliance processes, employee training, and technology.
What metrics need to be showcased in GRC reports?
GRC reports should provide clear, data-driven insights into an organization’s governance, risk, and compliance posture. These reports help leadership and stakeholders assess effectiveness, identify gaps, and make informed decisions. Key metrics that should be included in GRC reports are:
1. Risk assessment scores – Measures the organization’s risk exposure across different domains, helping prioritize mitigation efforts.
2. Compliance status – Tracks adherence to regulatory requirements and industry standards, highlighting any gaps or non-compliance issues.
3. Incident response metrics – Includes the number of security incidents, response times, and resolution effectiveness to evaluate risk management efficiency.
4. Audit findings and remediation progress – Summarizes internal and external audit results, showcasing corrective actions taken to resolve compliance or security issues.
5. Policy adherence rates – Monitors employee compliance with internal policies and procedures to gauge the effectiveness of governance measures.
6. Maturity level – Assesses the overall maturity of the organization’s GRC framework, ranging from reactive and ad-hoc processes to a fully integrated, optimized system.
7. Third-party risk scores – Evaluates vendor and partner risks, ensuring external entities meet security and compliance requirements.
8. Training and awareness metrics – Tracks employee participation in GRC-related training programs, indicating the organization’s commitment to a compliance-aware culture.
A well-structured GRC report should provide actionable insights, helping organizations continuously refine their governance, risk, and compliance strategies.
Can we use any software for GRC certification?
No, not all software can be used for GRC certification. While GRC software helps automate compliance tracking, risk management, and governance processes, certification is granted based on adherence to specific regulatory frameworks and standards. Organizations must ensure that the GRC software they use aligns with relevant compliance requirements such as ISO 27001, SOC 2, HIPAA, or PCI DSS.
Additionally, some regulations require independent audits by accredited certification bodies, meaning software alone cannot guarantee certification but can streamline the process by managing documentation, audits, and policy enforcement. Choosing the right GRC software tailored to industry standards significantly enhances compliance readiness and simplifies certification efforts.
What are some popular GRC software products?
- Scrut – A cloud-based GRC platform designed to simplify compliance management, automate audits, and provide real-time risk insights.
- Diligent HighBond – An enterprise GRC solution that integrates risk assessment, compliance tracking, and internal audit management for streamlined governance.
- IBM OpenPages – AI-powered GRC software that helps businesses manage regulatory compliance, risk assessment, and data governance at scale.
- LogicManager – A user-friendly GRC platform that centralizes risk management, compliance tracking, and policy management.
- LogicGate Risk Cloud – A flexible, no-code risk management solution that enables organizations to build custom GRC workflows.
- MetricStream Enterprise GRC – A comprehensive GRC suite that provides advanced risk management, audit automation, and regulatory compliance tools.
- Navex Global Lockpath – A risk and compliance management platform that helps organizations monitor, assess, and mitigate operational risks.
- ServiceNow Governance, Risk, and Compliance – An integrated GRC solution that automates compliance workflows, streamlines risk assessments, and enhances enterprise-wide visibility.
What are the common GRC frameworks?
GRC frameworks provide structured guidelines for managing governance, risk, and compliance across organizations. These frameworks help businesses align with industry best practices, regulatory requirements, and security standards. Here are some of the most widely used GRC frameworks:
| Regulation | Description |
| ISO 27001 | International standard for information security management and risk-based cybersecurity. |
| NIST Cybersecurity Framework (NIST CSF) | Best practices for managing cybersecurity risks, developed by NIST. |
| COSO ERM (Committee of Sponsoring Organizations Enterprise Risk Management) | Framework for identifying, assessing, and managing business risks. |
| COBIT (Control Objectives for Information and Related Technologies) | IT governance framework aligning processes with business and compliance goals. |
| FERPA (Family Educational Rights and Privacy Act) | U.S. law protecting student education records and personal data privacy. |
| SOC 2 (System and Organization Controls 2) | Compliance framework ensuring data security, integrity, and privacy for service providers. |
| HIPAA (Health Insurance Portability and Accountability Act) | U.S. regulation for safeguarding healthcare information and ensuring compliance. |
| PCI DSS (Payment Card Industry Data Security Standard) | Security standard for protecting credit card transactions and preventing fraud. |
| COPPA (Children’s Online Privacy Protection Act) | U.S. law regulating online data collection for children under 13. |
| GDPR (General Data Protection Regulation) | European regulation governing data privacy, collection, and processing. |
What are the factors to consider while evaluating GRC software for the organization?
When evaluating GRC software for your organization, consider the following factors:
- Functionality: Ensure the software offers comprehensive features that align with your organization’s specific governance, risk management, and compliance needs.
- Performance: Assess the software’s efficiency and reliability in handling GRC processes to ensure it meets your operational requirements.
- User-friendliness: A user-friendly interface facilitates ease of use and can enhance user adoption across the organization.
- Cost: Evaluate the pricing structure to ensure it fits within your budget while delivering the necessary features and support.
- Vendor support and expertise: Consider the vendor’s reputation, user reviews, and the expertise of their support team to ensure they can provide adequate assistance and updates.
By carefully assessing these factors, you can select a GRC platform that effectively supports your organization’s objectives and regulatory requirements.
Analyzing Scrut’s GRC platform
Scrut’s GRC platform is designed to streamline governance, risk, and compliance management through automation and pre-mapped frameworks. It helps organizations establish policies, mitigate risks, and maintain compliance efficiently. Below are the key features that make the Scrut platform an effective solution:
- Framing governance policies with the Scrut platform
Scrut offers pre-built policies mapped to compliance frameworks like SOC 2 and ISO 27001, enabling organizations to quickly establish and customize governance policies that align with industry standards. It also harnesses the power of AI for policy creation with its unique GPT Policy Builder.
- Mitigating risks with Scrut
The platform provides real-time risk assessments, automated workflows, and continuous monitoring to help organizations proactively identify and mitigate security threats.
- Seamless integrations and automation
The Scrut Platform integrates with cloud providers, security tools, and business applications, reducing manual efforts and enhancing efficiency in governance, risk, and compliance management.
Simplify GRC. Strengthen Security. Stay Compliant.
Take control of your governance, risk, and compliance with Scrut’s GRC Platform—your all-in-one platform for effortless compliance, real-time risk management, and seamless automation. Stay ahead of evolving regulations while reducing manual effort.
Ready to take control of GRC? Schedule a demo now!
FAQs
What happens if companies don’t get GRC certification?
Companies without GRC certification risk legal penalties, financial losses, and reputational damage. Non-compliance can lead to regulatory fines, operational disruptions, and loss of business opportunities, especially in highly regulated industries.
What are the key aims of governance and compliance?
Governance and compliance ensure that organizations operate ethically, manage risks effectively, and meet regulatory requirements. They promote accountability, transparency, and strategic alignment while mitigating potential legal and operational risks.
What is the main benefit of GRC?
The biggest advantage of GRC is its ability to integrate governance, risk management, and compliance into a unified framework. This improves decision-making, strengthens risk mitigation, ensures regulatory adherence, and enhances operational efficiency.
What are the GRC frameworks?
GRC frameworks provide structured guidelines to manage compliance, risk, and governance. Common ones include:
- ISO 27001 – Information security management
- NIST CSF – Cybersecurity risk management
- COSO ERM – Enterprise risk management
- COBIT – IT governance framework
These frameworks help organizations align with best practices and regulatory expectations.
Does an enterprise need a different GRC solution?
Yes, enterprises typically require more robust and scalable GRC solutions than smaller businesses. They deal with complex risks, multiple regulations, and larger data volumes, requiring advanced analytics, automation, and integration with existing systems.
Who are the stakeholders for GRC implementation in an organization?
Each stakeholder plays a vital role in maintaining an effective GRC framework.
- Board of Directors (BoD) – Oversees GRC strategy and risk management.
- Executive leadership – Allocates resources and drives implementation.
- Risk management team – Identifies and mitigates organizational risks.
- Compliance officers – Ensures adherence to regulations and policies.
- Internal audit team – Monitors and evaluates GRC effectiveness.
- IT department – Manages cybersecurity and compliance technology.
- Legal team – Provides guidance on regulatory requirements.
- Business unit heads – Implement GRC within their departments.
Megha Thakkar has been weaving words and wrangling technical jargon since 2018. With a knack for simplifying cybersecurity, compliance, AI management systems, and regulatory frameworks, she makes the complex sound refreshingly clear. When she’s not crafting content, Megha is busy baking, embroidering, reading, or coaxing her plants to stay alive—because, much like her writing, her garden thrives on patience. Family always comes first in her world, keeping her grounded and inspired.
