The enforcement of regulatory standards (both internal and external) has changed from a secondary business role to a primary consideration. However, these regulations are constantly evolving to meet an ever-changing digital landscape. Organizations must pay close attention to governance, risk, and compliance trends to remain compliant and match IT processes with goals efficiently.
What is Governance, Risk, and Compliance (GRC)?
GRC is a well-coordinated and integrated set of capabilities that promote conscientious performance at all company levels. These functions include:
- Outsourced work to third parties
- The lines of business, the executive suite, and the board of directors’ work
- Internal compliance, audit, risk, legal, financial, human resources, and IT
Reviewing 2021 Governance, Risk, and Compliance Trends
The following are significant GRC-related trends that became an integral part of 2021 business operations:
1. Changing the Work Environment
The COVID-19 economic shutdown of 2020 brought about significant changes in the workplace. Most personnel transitioned from offices to homes, and businesses replaced in-person meetings with video conferencing technologies.
Employers anticipate an extended remote working environment even though some team members are returning to the workplace – implying that this paradigm could become an intrinsic part of many organizations’ business culture.
The struggle of balancing in-office, hybrid, and fully remote working arrangements might have far-reaching ramifications for the nature of employment, particularly employer-employee relationships.
More specifically, employers needed to address the added challenges of:
- Whether to require immunizations to return to the workplace
- Determining if a single central office is necessary
- Finding ways to deal with employee mental health
Furthermore, the change to working from home increased the potential for corporate information leaks. The frequency of cyberattacks is rising, requiring compliance officers and risk managers to work more closely with their IT teams to meet these challenges (we will discuss this in more detail later).
2. Addressing Supply Chain Flaws
The pandemic exposed significant shortcomings in most organizations’ supply chain processes. Businesses in most industries faced one or more of the following scenarios:
- An inability to import vital products
- A raw materials scarcity
- A decline in product demand (and resulting slow inventory turnover)
- Liquidity issues
Organizations needed to fine-tune their supply chain requirements and safeguard their practices from operational risks, such as suppliers’ financial stability and capacity to deliver products under unforeseen circumstances.
3. Leveraging Integrated Risk Management (IRM)
2020 established a new and higher level of uncertainty in all business operations, and most analysts believe this to be a prevailing trend for many years to come.
As a result, IRM (or the integration of risk analysis to help organizations make better decisions) became a focal point of compliance departments. Many risk managers and compliance officers demanded that their businesses implement IRM decision-making procedures in 2021 and reimagine corporate governance through compliance and risk management.
2022 GRC Trends
The following are trends many experts believe will become focal points of 2022 and beyond:
1. Increased Use of AI-Driven Bots
AI-driven bots are becoming increasingly important (and commonplace) in almost every industry. Companies now employ them for internal and external (i.e., client assistance) reasons. Most employees directly engage in conversational platforms daily, garnering help with various issues ranging from technical inquiries to PTO requests.
They can also answer inquiries without interruption around the clock, which is difficult to achieve with human service agents. In addition, this technology becomes extremely cost-effective when a single bot can serve several people simultaneously.
2. Digital Transformations Via Cloud Computing
Cloud computing has been a prominent development in the IT GRC industry for two decades and is a significant contributor to the digitization of company activities. Team members from different departments and work locations can now access files, data sets, and a wide array of system tools via a single, unified platform.
However, a firm-wide migration of data exposes any organization to increased non-compliance risks (intended or otherwise). IT GRC teams must learn to fully leverage these technologies while adhering to critical regulatory criteria as it migrates to the cloud.
Steps to accomplish this might include:
- Practicing ongoing compliance. The fast growth of cloud services has resulted in numerous modifications to data compliance rules to which IT GRC experts must adhere. As policies change or expand, organizations should regularly implement methods to update this database. This process helps establish a clear, active structure for keeping digital compliance standards current.
- Implementing disaster recovery procedures. Cloud computing’s inclusion into company operations has revolutionized how companies recover from system failures and cyberattacks. Cloud providers can now offer access to data backups and business continuity services since cloud technology unites business data and technologies into one unified platform.
- Bolstering data protection processes. Many cloud companies comply with HIPAA, payment card industry (PCI), and other data protection requirements. However, this does not absolve enterprises who use third-party cloud services of any responsibility for cloud data security. Password protection, virtual private networks (VPNs), and encryption are essential for keeping an organization’s data confidential during a cloud migration.
3. Increasing Cybersecurity and Data Privacy Needs (Post-Pandemic Improvements)
While advancements in cybersecurity were a primary focus in 2021, attacks on government organizations and corporations continue to grow in frequency and complexity. More action is necessary, which will include the following cybersecurity developments:
- Classification of Actions. Machine learning technologies can classify particular user actions as either normal or abnormal, which will assist IT teams in identifying potential threats
- Proactive Cybersecurity. IT teams will need to be even more aggressive in their cybersecurity activities. Tactics like threat hunting, endpoint monitoring, and staff training can help organizations identify and remediate vulnerabilities before a cyberattack happens.
- Privacy Policies for Internal Data. Concerns over data privacy legislation continue to grow due to cloud computing shifts and potential large-scale data breaches. Organizations should look to produce specific, enforceable corporate data privacy policies to maintain their IT GRC standards.
Cask Can Help You Meet GRC Standards
Managing different policies and procedures within an organization is challenging, and keeping up with the latest governance, risk, and compliance trends is critical to doing so correctly. Discover how our ServiceNow platforms can help you adapt to changing GRC trends and prepare your business for future success.