Governance, Risk, and Compliance Explained

By October 28, 2016Risk Management
Word cloud with large words like GRC, Governance, Compliance, Risk Management

Every business needs a way to achieve its objectives and address risks to the business. Businesses big and small, brick-and-mortar or in the cloud, require strong leadership, a plan to mitigate risks, and oversight of compliance with regulations and laws. This is a lot to handle, which is why some enterprises establish entire departments to manage these areas. What a lot of businesses misunderstand is that governance, risk, and compliance is not something to split up and address individually by department but rather by bringing these departments together to work for the greater effectiveness of the business as a whole.

What Is Governance, Risk, and Compliance?

While GRC stands for governance, risk and compliance, it encompasses many more aspects of business. It includes finance departments, human resources, information technology, legal departments, and even boards and directors. Each of these areas and more have important responsibilities to the successful operation of a large company or small business. So when you have these departments in place, your business is solid, right?

The problem arises when there are barriers or silos put up between the departments. On its own, each section of business might run effectively. Each might be able to mitigate risks contained within its boundaries of operation and responsibility. However, each department is but one organ in the business body – they need to work together for the collective wellness of the company. If barriers are in place or departments are siloed off, there is likely to be redundancy, cost-prohibitive activities, and a breakdown of communication and overall effectiveness.

In cloud computing especially, your teams may not be physically located in the same office, or country for that matter, an effective GRC program is essential to reduce costs and increase productivity across all functions of a business. The risk assessment team needs to understand the policies and strategic plan created by those responsible for governance, risk and compliance. Compliance management should understand the risks and controls in place and how each fits in with policies, business objectives and laws. Laws and regulations in particular can get sticky with the cloud, as the location of data can quickly change. This is precisely why a quality GRC program can be very helpful, and in some cases, necessary.

The Value of an Effective GRC Tool

Cloud computing is the way of the future as the world becomes more connected on a global social scale. The cloud also provides an efficient way for different parts of any business to communicate, which is an essential part of effective GRC. The GRC process is a continuous cycle of evaluating, developing, implementing and informing. When used correctly, effective GRC tools can assist in

  • Improving efficiency
  • Optimizing costs
  • Protecting the business
  • Detecting, reducing and preventing risks
  • Motivating employees
  • Achieving objectives
  • Reducing time and resource commitments to compliance with laws and regulations
  • Reducing redundancy and duplicative work by employees responsible for compliance

There are several GRC solutions available to businesses who operate in the cloud. These tools make it possible to oversee, align goals, detect risks and problems, respond, resolve, monitor controls, integrate and inform between all of your departments to make your business as efficient as possible. A good GRC tool will make all of this easier, but it is still vital for you to take an active role in the process. A tool is only effective when it is wielded by a capable individual. Many GRC offerings include the tool itself and also consulting services with setting up the tool to work in the most effective way for each unique business.

Your Solution

Barr Assurance & Advisory Inc. offers GRC advisory services tailored to meet the unique risks and needs of cloud-based services. Your various departments might handle their individual responsibilities proficiently, but it is important for them to come together to develop solutions that increase productivity and reduce costs and risks. We can help by tearing down the barriers that keep your business from achieving optimum efficiency. To learn more about GRC programs and how they are an essential element of cloud-based businesses, schedule your free consultation today.

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