Governance Risk Management and Compliance- or what we commonly knew as GRC. This refers to the strategy of managing the company’s overall governance. As well as of its risk and compliance aspects.
What’s more into governance risk management and compliance? What’s the key to its successful implementation? What is a GRC framework?
More About GRC
First, consider the benefits GRC does to your business and systems. To name a few, it improves your management’s decision making and better IT investments. Moreover, this eliminates silos, and minimizes the breaking down among departments.
How does GRC do so? One key is understanding its three major elements. Here are their brief descriptions.:
- Governance. This ensures the activities inside the organization. So, that they are in line with the business goals. Of which includes IT operations.
- Risk. The risk factor ensures the identification of risks. Likewise, deal these risks in line with the business’ goals. The goal is to mitigate risks. Also, to minimize the vulnerabilities the organization is facing.
- Compliance. This also makes sure that the business is complying with the legalities. More of these concerns the data protection policies of the state.
How GRC Works?
There is a lot of helpful software regarding GRC. However, an effective GRC operation is more than a set of software.
In line with that, many companies seek the guidance of a framework. Because a GRC framework aids in developing and refining the GRC strategies.
Additionally, a framework can provide basic components. These can serve as building blocks. Of which, can be specifically tailored to each business’s needs.
Furthermore, consider these 2 GRC frameworks.
Or the ‘Control Objectives for Information and Related Technology’. This specializes in management and governance. Moreover, it has 5 basic principles.
- Meeting the stakeholder’s needs. First, this involves identifying the stakeholder’s needs. Second, it is about meeting those needs.
- Covering the enterprise end-to-end. This involves securing functions and processes. Especially into where the process of the information takes place.
- Single integrated framework. Sticking to a single integrated framework. Of which also sums up more established frameworks and standards. However, this should also be in line with the governance and management of IT standards.
- Holistic Approach. This is about implementing a set of helpers. As a result, this aids to a full approach to supporting IT governance and management.
- Separation of Governance from Management. This is all about not merging these two areas. Their management roles, activities, and responsibilities, for instance.
Stands for Committee of Sponsoring Organizations of the Treadway Commission. This framework focuses on internal controls.
These internal control objectives are classified into three. Which includes, operations, reporting, and compliance.
- Operations. Includes the performance goals. Besides, protecting the company’s assets from liabilities. And focuses on the success of business operations.
- Reporting. Contains both the external and the internal financial reports. Which relates to the clarity, and reliability of reporting habits.
- Compliance. Adheres to laws and regulations that the organization must comply with.
Furthermore, the COSO Framework believes in 5 components. These aids in the internal control system.
- Control environment
- Risk assessment
- Control Activities
- Information and communication
In conclusion, this video will tell you more.