In establishing governance, your organization must consider its regulatory compliance needs and put in place procedures and tooling to efficiently capture compliance records, thus enabling your organization to record and communicate the extent to which various processes are executing in compliance with business or regulatory policies. Financial organizations in particular continue to feel pressure from regulators, auditors, boards, and investors to manage risk more proactively and comprehensively. The demand for computer and information systems managers will continue to increase as organizations work to keep up with the expanding use of wireless and mobile networks.
Governance risk and compliance is led by the chief risk officer, who oversees the management of major enterprise risk and control activities with a view to understanding existing and emerging risks and their impact on your risk profile and capital requirements and ensuring that the magnitude of those risks remains within the board of directors approved risk appetite. Carefully considering how administrative privileges are provisioned to database users can save your organization major headaches down the road, including mitigating the risk of a costly data breach. The chief risk officer also aims to promote quality leadership, effective people management, and efficient and ethical use of your resources.
Enhanced compliance with regulatory and governance requirements, effective collection and management of asset knowledge, effective resource utilization, optimum infrastructure investment, and understanding risk at an individual asset and asset portfolio level all help make business more efficient and far reaching. However, this comes at the cost of an increased risk of privacy intrusion, thus potentially affecting authorization in a potentially negative way. There are many external factors that are often beyond your control, so be wary of pursuing a strategy which may change one of such elements as you may have a long, exhausting, unprofitable battle ahead of you.
A way to ensure employees both understand the importance of following policies and procedures and know how to do so is to implement a policy management system. Control (embedded in risk management) is the process conducted by management to mitigate risks to acceptable levels. By the same token, the main focus of enterprise risk management is to establish a culture of risk management throughout your organization to handle the risks associated with growth and a rapidly changing business environment.
Social responsibility and business ethics are often regarded as the same concepts and part of due diligence requirements. Officers are required to ensure that the business or undertaking has appropriate processes for receiving and considering information regarding incidents, hazards, and risks, and responding in a timely way to that information.
Once risks have been identified, businesses need to determine the likelihood and consequence of each risk. With expertise in key areas like cost savings, risk management, compliance, centralized purchasing, and contract management, the best procurement teams are able to streamline all of a company’s spend mechanisms into a singular system. Interestingly, another risk that businesses often have to deal with is the confusion between compliance and cybersecurity.
An effective vendor risk management program should be risk-focused and provide oversight and controls proportionate to the level of risk associated with the third-party vendor relationship. Risk management refers to the set of principles, culture, processes, and coordinated activities used to direct and control an organization with regard to the many risks that can affect its ability to achieve its objectives.
Want to check how your Governance Risk And Compliance Processes are performing? You don’t know what you don’t know. Find out with our Governance Risk And Compliance Self Assessment Toolkit: