When it comes to managing your business, it helps to be strategic. Otherwise, you can end up with a lot of wasted energy, lost money and time and massive legal headaches.
Governance, risk management and compliance (GRC) is one such approach – and it’s effective because it integrates these three important things into each division within an organization. GRC helps prevent “siloed” approaches, where every department grows increasingly isolated within its own bubble, which can easily lead to miscommunications (or even promote fraud).
What does GRC take?
GRC relies on keeping everybody in the company on the same page when it comes to the rules and standards that must be followed (governance), identifying potential threats to the business itself (risk management) and the corporate responsibility (compliance) to operate within legal and ethical boundaries.
GRC relies heavily on modern technology, such as software-as-a-service (SaaS) solutions to make sure that there is full transparency throughout an organization. Once put into place, however, it can help companies:
- Make decisions: Corporate leaders can better understand how compliance needs align with business objectives and the consequences or dangers of different courses of action.
- Improve operational efficiency: GRC practices can make it easier to allocate its resources more effectively.
- Respond to regulatory changes: It can be difficult to keep up with changing regulations, and harder still to make sure every department is kept up-to-date when they happen. GRC approaches can make updates much faster and more consistent and allow for an adaptive compliance program.
It’s important to remember that regulatory compliance is not the sole responsibility of any one department in a business, whether legal, IT, finance or management operations. A holistic approach to the compliance process is often the only sensible approach. When you have compliance concerns or are facing issues over a compliance error, seeking legal guidance is wise.