Governance, risk, and compliance, or GRC, means an organization’s comprehensive risk management approach to align its IT and business goals. Understanding the GRC meaning is crucial for businesses aiming to establish effective governance, manage risks, and ensure compliance within their operations. In the first scholarly research published in 2007, GRC is formally defined as “the integrated collection of capabilities that enable an organization to reliably achieve objectives, address uncertainty, and act with integrity.”
The GRC means governance, risk management, and compliance. This approach is a combination of
Governance: Governance is the sum of procedures established and implemented by the top management, or the board of directors, demonstrated in the organization’s structure and management to achieve its business objectives.
Risk management: This facet of GRC focuses on predicting, mitigating, and responding to risks that can hamper the organization in achieving its business objectives.
Compliance: Compliance is adherence to mandatory laws and regulations and voluntary frameworks to achieve an elevated level of security posture.
A robust cybersecurity posture in today’s business landscape mandates a comprehensive GRC approach. One is almost impossible to achieve without the other. GRC is one of the more recent concepts in the cybersecurity landscape; nonetheless, it is becoming the pillar on which the organization’s cyber resilience is based.
The evolution of GRC
GRC was a pretty neglected concept until recent years. It lacked standardization. Therefore, every organization had a different perspective towards it. The primary focus was compliance and regulatory issues. Organizations compiled rules and regulations to avoid penalties and fines.
2001- The Enron scandal
Some events changed the GRC landscape forever. In 2001, the world saw one of the biggest scandals in human history – the Enron scandal. SOX was passed in 2002 to protect investors by improving the accuracy and reliability of corporate disclosures.
2008- The global financial crisis
Again in 2008, the global financial crisis begged for financial controls over listed companies. These events changed the perception of GRC and gave it a more modern approach.
Current state of GRC
As opposed to the past, today, organizations are willing to invest more in GRC as they have realized the importance of GRC in today’s business landscape.
Today some regulations are mandatory, and frameworks are voluntary to carry out compliance. Instead of an isolated area, GRC is becoming mainstream as more consumers prefer organizations with a modern GRC policy in place instead of those that don’t.
However, there are still some issues with the successful implementation of GRC. There are numerous rules and regulations to be followed for compliance in an organization, and some of them overlap. So, the tasks take longer and become complicated.
To be able to add value to business activities, organizations should be able to comply with GRC requirements with less time and expertise. The only befitting way out of the situation is to partner with an outside counsel to guide the organization about the relevant requirements and help it follow them.
Automating the GRC process can reduce the time spent on repetitive tasks, evidence collection, and policy formation. Below is a detailed breakdown depicting how using an automated GRC platform is different from following traditional GRC methods.
A truly competent GRC solution integrates governance, risk management, and compliance seamlessly with an organization’s business goals. There are many such GRC automation tools available in the market today.
Today we will take a deep dive into how to select the right GRC platform while focusing on smartGRC, which is a modern approach that helps organizations accelerate compliance and risk monitoring while ensuring reliability, speed, and security.
What does a GRC platform do?
A typical GRC structure encompasses corporate governance, enterprise risk management (ERM), and compliance with applicable laws and regulations.
It is crucial to align all three components of GRC with the organization’s business goals to avoid overlaps and promote effective information security. With the growth in the organization, GRC becomes a taxing task and takes a back burner leading to dire consequences.
The organization often faces issues in training the employees to follow policies and procedures, finding gaps in the systems and designing ways to fill them, keeping pace with the upcoming regulations, and ensuring that controls are maintained throughout the organization.
On the other hand, independently taking up the three facets can lead to a lot of duplication and overlaps. These issues call for a tool that can manage your compliance posture with relative ease and simplicity. In this case, that tool is a smartGRC platform.
What are the benefits of using a modern GRC solution?
A GRC tool can help the organization establish and maintain IT policies and procedures, comply with regulations, and manage cyber risks while achieving business goals. GRC tools or solutions are designed to automate your manual processes and help you achieve your GRC goals effortlessly. The benefits of a modern GRC solution make it a preferable option over traditional GRC. Here are some of the benefits that cannot be overlooked.
Improved risk management
GRC tools help the organization to identify and manage risks effectively. Typically, a GRC tool features risk assessment and threat monitoring modules. These modules help the organization in improving the overall risk management posture of the organization. As the risks and threats are monitored and reported to the management in real-time, they can take quick actions to secure the organization’s IT systems.
Strengthened compliance
As the compliance procedures are becoming more stringent and the scope of standards is also widening, organizations often face gaps in compliance. GRC software provides organizations with a centralized repository of policies, controls, regulations, and frameworks. It provides a comprehensive guide to the organization and assists in following them. Ultimately, strengthened compliance is one of the most important features of a reliable GRC tool.
Improved efficiency
With a GRC tool, an organization can reduce manual tasks by automating them, thereby improving efficiency. It provides standardized workflows, approval process, and notifications that reduces the need for manual intervention. In addition to that, GRC tools provide real-time data analytics, helping organizations make well-informed decisions and detect areas for improvement.
Assisted decision-making
GRC tool assists decision-makers by providing a wealth of information and analytics. With real-time risk assessment, the decision-makers can take quick actions if needed. Real-time data and analytics also help the organization make effective decisions that can prevent a breach or penalty. GRC tool can also identify the areas where improvements are needed by continually monitoring the data. This can update the organization’s systems as soon as the vulnerability is detected.
Enhanced transparency
A GRC tool is equipped with data, analytics, and reports on its dashboard. The management can review the organization’s governance, risk management, and compliance posture at any time with a click of a button. Moreover, the organization can showcase the compliance and risk strategies to its stakeholders, including present and prospective consumers, shareholders, and vendors. Sharing this information can accentuate trust among stakeholders. If the need arises, the governing bodies can review the state of the organization’s affairs on the platform.
Reduced cost
A GRC tool should be considered to be an investment rather than an expenditure. This means the benefits of the GRC tool costs are available for considerably longer periods of time. Firstly, it decreases human resource costs by automating repetitive tasks. The time and effort spent on such tasks can be spent on profit-generating activities. Additionally, it reduces the chances of errors – so the cost of human errors is reduced. If the organization faces fines and penalties for non-compliance, it can tune-up to a significant sum denting the resources of the organization. A well-maintained GRC tool can nullify the chances of fines and penalties for non-compliance
Audit assistance
A robust GRC solution can not only integrate with all your apps and software but also automatically collect evidence from them. It can reduce human involvement by 70%. The auditor can be on the same platform, and the organization can share the information with them without much effort. Communication with the auditor about the audit process is well-documented to reduce the time taken in passing the information back and forth.
Now that we have discussed the benefits of a modern GRC solution, let’s move on to discuss the factors to be considered while evaluating the GRC software for your organization.
Factors to consider while evaluating GRC software for your organization
Most organizations start searching for a GRC solution when they realize that their in-house efforts are inadequate and unsustainable to maintain security in the long run. And it is during this search that they overlook several critical factors that can either make or break their GRC program.
Investing a large amount of money in a tool that is not right for your organization can cause havoc for your organization. Not only finances but the reputation of your organization can be in question because of one wrong step.
The right GRC tool can make the tasks in an organization much simpler. It helps employees adapt to security requirements without intensive training, and the compliance requirements can be fulfilled with little effort. But that all depends on whether you select the right tool for your organization or not.
Here are a few steps you can follow while evaluating a GRC tool for your organization:
Identify the pain points
The first step is to list the problems you need to address with a GRC tool. Which are the pain points, if not addressed, can create bigger losses to your organization? Ask yourself the following questions.
Different GRC tools have been developed to solve different pain points of the clients. When you select your solution, you must know what exactly you are looking for in the solution.
Assess different GRC vendors
Focus on your budget and the solutions available to you in the market. Compare and contrast different GRC tools on the basis of what your organization needs. Take the example of the following checklist to see how fitting the tool is for your organization.
GRC tool checklist
After comparing a few vendors, you should check with your selected vendor about the pre-launching requirements and the time needed to implement the governance, risk management, and compliance. You should confirm the non-functional requirements with your GRC vendor too. Also check out our article on how to choose GRC Software/Tools?
Assess non-functional requirements of GRC
Non-functional requirements of GRC include all the expectations from the solution over and above the basic requirements. These requirements are
- Scalability – Your GRC platform should be able to handle your organization’s growth. It should also be able to include all the new laws and regulations that are relevant to your organization in the future.
- Security – Your GRC vendor must secure your data adequately from unauthorized access.
- Integration – You should be able to integrate your existing software and applications into the GRC software without having to make major changes.
- Usability – The GRC platform you choose should be simple enough to use. Training your employees about the solution should be aided by the vendor.
- Customer support – The GRC vendor should provide customer support when you need it. The customer support team should be able to guide you through difficult situations.
- Customer reviews – Check the customer reviews of the GRC software to know what the existing customers have to say about the product.
Manage pre-launch
Some of the pre-launch steps that need to be taken before implementing the GRC solution are
- Take information from the vendor about pre-launch requirements
- Appoint an in-house team to collaborate with the GRC vendor team
- Determine how the new tool will be configured at the launch
- Ensure the user training by the vendor is scheduled
- Evaluate the vendor system documentation
- Ensure all the IT assets required by the vendor are in place on the D-day
Manage the launch
After a solid pre-launch preparation, the launch can be smooth and event-free. The launch event should be done in coordination with the vendor. The following points should be taken into mind at the time of launch.
- Form a data recovery plan in case something goes wrong
- Coordinate with the vendor team for implementation
- Set up real-time indicators to test the performance of the solution
- Notify all the stakeholders about the implementation of the GRC software
Now you know how to successfully choose and integrate a GRC platform into your system. Let’s look at Scrut’s smartGRC to know how it helps organizations streamline their GRC processes.
Framing governance policies with smartGRC
Every organization has its unique needs for the formation of a comprehensive plan based on its industry, business, and size. Governance policies must be well aligned with the business goals for overall organizational growth.
Scrut’s smartGRC is a modern GRC tool that lets you take control of your organization’s governance policies in a much simpler and smarter way. It features a library of policies the client can choose from. These pre-built policies are vetted thoroughly by industry experts and aligned with popular industry frameworks.
Moreover, with Scrut, you have the option to customize your governance policies from templates or build your own policies. You can get these policies verified by industry experts to ensure compliance with well-accepted frameworks and governance principles. Also check out our article on why Scrut is the best GRC software?
Unleashing the power of AI with GPT Policy Builder
Scrut has launched a new feature that helps you to team up with ChatGPT, which can hasten the process of policy formation called GPT Policy Builder. It can help you create policies regardless of your knowledge level. It will ask you simple questions like the size, industry, and location of your organization and build policies customized for you.
The organization can create tailor-made policies by entering minimum information via prompts and questions. The integration of AI-powered GPT can make policy building faster and easier and help you achieve compliance with the leading industry standards. It offers a continually evolving solution for your governance policies.
This level of customization ensures that your policies and procedure are in sync with your business goals. There are neither overlaps nor duplications of efforts in the workflow, nor are any activities neglected – helping you accelerate your compliance procedure significantly. Also checkout our article on how you can use Scrut’s GPT Policy Builder for policy generation.
Mitigating Risks with smartGRC
Identify and assess risks
Risk management starts with the collection of evidence from various sources in the organization. One of the first steps taken after you register your organization with Scrut is risk assessment and gap analysis done by collecting evidence. A team of experts will review your organization’s controls to verify whether they are adequate to mitigate the risks in the present world. If not, the team will guide you to form a more suitable policy to ensure cybersecurity.
Implement controls
The next step is to implement controls to mitigate the risks assessed. This includes training the employees and implementing and reporting mechanisms. Scrut provides an excellent feature to help you train and assess your employees. Monitoring and reporting the control activities can help the organization know the pitfalls in the systems and devise ways to mitigate them.
Monitor and report
A typical organization uses different applications and software, cloud services, communication channels, and platforms to carry out its functions. An organization should monitor and report the effectiveness of controls on every function it performs. Scrut’s smartGRC tool can monitor and report on compliance and risk management activities, assisting the organization in identifying and addressing the risks quickly.
Moreover, the organization should regularly update its policies to suit the requirements of the laws and regulations. Also, regular updation can fortify the organization from emerging threats and risks. smartGRC can help the organization stay ahead of the new rules and regulations along with evolving risks.
Involving stakeholders
Engaging stakeholders, such as employees, customers, and regulators, is critical to the success of GRC. By involving stakeholders in the risk management process, organizations can gain valuable insights and feedback, improve risk awareness, and build trust and credibility. It improves the transparency between stakeholders and the organization’s management, thereby increasing trust.
Third-party risk management
When cybercriminals attack an organization, its stakeholders also face the risk of secondary cyber attacks. Therefore, any organization must be vigilant in choosing its vendors. Scrut offers vendor risk assessment options to all its customers. It helps you to assess the security posture of your vendor or third parties via simple questionnaires.
You can collect the vendor security data, assess it, and share it with the auditors to verify whether they have implemented adequate safeguards for your data. You can also compare the risks presented by different vendors on a single platform in a visual manner before you finalize your vendor.
Maintain compliance with smartGRC
Compliance includes adherence to mandatory and recommendatory regulations, policies, and standards to be followed by an organization for improved cybersecurity. Compliance can help the organization take greater control over its cybersecurity posture.
Some compliance requirements are mandatory to be adhered to, such as GDPR, HIPAA, and SOX. Failing to adhere to these compliance standards can result in penalties and fines to regulatory bodies. It can also lead to legal suits wrecking the reputation of the organization.
Voluntary frameworks like ISO 27001 or SOC 2 are crucial in establishing trust with potential clients. These standards ensure that the organization is following stringent practices to protect the information of its clients.
Both standards and frameworks can enhance the governance policies of the organization. The management gets a clear view of the loopholes in the security process and develops ways to eradicate them.
Thanks to Scrut, your organization can streamline the compliance processes for all the standards and frameworks applicable to your organization. It also helps you in the audit processes, including getting your systems for audit and coordinating with the auditors for a smoother assessment.
Having an integrated platform for compliance standards, risk management, and governance is convenient and cost-effective. It eliminates overlaps and duplication of functions. The management can access all the facets of GRC from a single platform.
What do Scrut clients have to say about smartGRC?
Client testimonials are the most reliable way to know the truth about products and services. So, what better way to know how Scrut smartGRC works than to hear from our customers? Here is what they have to say!
Summing up
To sum up, governance, risk assessment, and compliance are three of the most important aspects of a modern business landscape. It improves the cybersecurity posture of the business, increases customer trust, and saves the organization from non-compliance issues. Overall, the organization can increase its business turnover by demonstrating to its customers that it has formal policies in place.
A modern GRC solution can automate manual tasks, collect evidence for the auditors, and also help in collaborating with the auditors during audits. While looking for an appropriate solution, you must first assess your requirements and the GRC software available in the market to decide which one is best suited for you.
Scrut provides customers with an excellent governance, compliance, and risk management solution called smartGRC, which enables them to manage all security requirements from a single dashboard.
To learn more about smartGRC’s ability to streamline your security program, reach out to us today.
FAQs
Governance, risk management, and compliance or GRC means the integrated approach organizations take to manage their business processes, risks, and compliance requirements.
Implementing GRC in an organization can help improve risk management practices, increase compliance with regulations, streamline business processes, enhance transparency, and foster a culture of accountability and responsibility.
GRC is the responsibility of the entire organization, from the board of directors to individual employees. However, many organizations have a designated GRC officer or team who is responsible for overseeing and coordinating GRC activities.
smartGRC is certainly a better way to govern compliance and risk management than any other GRC tools. smartGRC provides a comprehensive solution for policy formation and implementation, risk management, and compliance. It helps you manage and showcase your compliance certificates and reports on a single dashboard.
You can evaluate the top GRC platform based on its functionality, performance, price, and ease of use. You should also consider the reviews of its users and the knowledge of the vendor team before entering into a contract.
