GRC Requirements 101: A Complete Checklist for Success

GRC (Governance, Risk, and Compliance) has existed for over a decade, and we have collectively witnessed the transition from siloed, disconnected processes to integrated GRC frameworks. Yet, new professionals entering the GRC domain still struggle with a common challenge—a daunting feeling of being unable to comprehend the breadth of the field, feeling intimidated by knowledge gaps, and stressed about keeping up with the evolving landscape.

To help, we’ve written this blog to discuss everything GRC. Let’s dive into the GRC requirements in detail, providing a solid starting point and enabling you to create your first integrated GRC plan.

List of GRC requirements

GRC, as we know, is made up of the 3 components—Governance, Risk, and Compliance and broadly, GRC is defined as a unified approach that helps organizations establish governance practices, mitigate risks, and meet compliance requirements.

However, the requirements of GRC go deep, and a lot of groundwork is required to set up an operating model within the interconnected space.

Let us break down each of these GRC requirements to facilitate a better understanding:

1. Governance requirements

An effective governance model enables the board to receive regular updates on GRC activities, establishes clarity on roles and responsibilities, and sustains efforts through an ongoing improvement mechanism. For this, you need the following:

Governance framework

A governance framework is a structured set of rules and guidelines that help direct the organization while holding the right people accountable. It provides a solid ground for decision-making while supporting risk management and compliance activities. A governance framework is essential to ensuring that the organization functions ethically, transparently, and efficiently and achieves its overarching objectives. The governance structure comprises of:

• Board of Directors: The board is responsible for providing strategic direction, supporting organizational goals, and ensuring stakeholder trust
• Executive management: The executives led by the CEO are responsible for implementing and overseeing activities laid out in the strategic plan
• Chief Financial Officer (CFO): The CFO oversees the financial health of the organization and is responsible for managing investments, cash flow, budgets, and compliance with financial regulations
• Chief Operating Officer (COO): The CCO helps implement operational policies and procedures and ensures that these are aligned to overall goals
• Chief Risk Officer (CFO): The CRO is responsible for coordinating the risk management activities and reporting the risk exposure for the organization
• Chief Compliance Officer (CCO): The CCO develops and maintains a compliance program to ensure adherence to applicable frameworks
• Internal committees: The internal committees, such as risk committee or audit committee, comprise of cross-functional leaders that help foster collaboration across departments
• Stakeholders: The key stakeholders include security teams, IT teams, employees, partners, and clients.

Strategy and performance alignment

Strategy and performance alignment consistently ensure that everyone in the organization is working towards the same goals and that the vision is reflected in business operations. To create this cohesion, the governance bodies set goals, properly allocate resources, measure and report performance, and continuously improve. Any opportunities or risks are proactively recognized to drive long-term organizational success.

Policy management

Policy management under governance involves drafting or updating policies to provide standardized guidance for organizational operations. This also includes giving step-by-step instructions on implementing these policies, monitoring the implementation, and periodically reviewing and updating them to ensure relevancy.

Some basic and common policies will include corporate governance policy, ethical code of conduct policy, risk management policy, incident management policy, business continuity policy, access control policy, change management policy, and regulatory compliance policy.

Board oversight

Board oversight holds management accountable for ensuring everything works as intended and any gaps are identified and resolved on time. It encompasses oversight related to risk, finances, compliance, internal controls, audits, and stakeholder engagement. The board must also uphold and maintain corporate governance practices and guide the organization’s efforts.

Sprinto can help you manage Governance:

• Maintain a list of active staff members and assign roles and responsibilities for a well-defined organizational structure.
• Use in-built policy templates to eliminate the need to create policies from scratch and publish them org-wide. Enforce periodic acknowledgments from employees.
• Use the senior management review module to review policies, risk assessments, staff device security risks, and more.
• Check the risk dashboard to understand the organization’s risk profile.
• Leverage the centralized dashboard to view real-time security and compliance status and pending tasks.

2. Risk management requirements

Forward-looking risk assessments, a risk-intelligent culture, and continuous monitoring and adjustment responses indicate a successful risk management component. The following are the risk management requirements to attain this desired state:

Risk identification and assessment

The risk component of GRC begins with a crucial step: risk identification and assessment, which involves scanning the environment to understand potential risks and evaluate their likelihood and impact.

• The risk identification step helps determine internal and external sources of risks, such as operational inefficiencies or regulatory shifts. Methods such as brainstorming sessions, automated risk scans, and historical data analysis are used to identify these risks. These are then categorized as core or non-core risks and subcategorized as operational, financial, technical risks, etc.

• Risk assessment involves evaluating the identified risks for likelihood of occurrence and impact. Methods such as risk matrices, qualitative assessments, and scenario analysis help understand the criticality of these risks, whether in terms of financial impact, operational disruptions, or reputational damage. The assessed risks are compared to the organization’s risk tolerance levels and prioritized according to criticality.

Risk mitigation

Risk mitigation involves developing and implementing strategies to minimize the impact of risks so they do not derail the organization in achieving its objectives. These strategies can be risk avoidance, risk transfer, risk reduction, risk sharing, or risk acceptance based on the nature and severity of risks. To minimize the risks, specific controls are deployed and implemented, and the residual risk after control implementation is assessed to ensure that it stays within the risk appetite.

Continuous monitoring

Continuous risk monitoring involves scanning the risk environment to assess any changes in the likelihood and impact of existing risks and the emergence of new risks. The risk mitigation strategies are reviewed in light of the key risk indicators, and the risk profiles are adjusted accordingly. Risk monitoring and reporting also help integrate risks into other business processes and maintain organizational resilience.

Sprinto can help you manage risks:

• Use the comprehensive risk library to pinpoint risks unique to your business
• Leverage the risk heat maps to understand the severity and likelihood of risk occurrence
• Assign risk owners to ensure control implementation accountability
• Automatically map risks to compliance and controls and continuously monitor them in light of the changing environment

3. Compliance requirements

Robust internal controls, regular reviews and assessments, responsiveness to regulatory changes, and transparent reporting are indicators of effective compliance management. The following are the requirements for effective compliance management:

Regulatory compliance

Regulatory compliance ensures adherence to laws, regulations, and standards, whether mandated by the regulatory bodies or voluntary but in the interest of the organization and clients. This involves identifying the applicable compliance frameworks and understanding their obligations to craft a compliance program. It also involves building and maintaining a pipeline of required controls and staying abreast of regulatory changes to minimize non-compliance penalties.

Reporting and documentation

Compliance activities involve a lot of documentation that must be presented to the auditor during external audits. This includes regular compliance reports, incident documentation, policy and procedure documents, audit trails and evidence for control implementation. The compliance officer ensures that these are accurate, well-structured, and secured to minimize any unauthorized access or tampering.

Internal and external audits

Internal and external audits help assess the effectiveness of compliance programs and identify any improvement areas.

• The internal audit teams conduct audits to assess compliance posture and provide recommendations to fix gaps before the organization proceeds to an external audit. Many follow-up activities are involved in internal audits until the company is ready with at least 90% of controls up and running.

• External audits are conducted by independent third parties that assess the organization’s adherence to regulatory standards. The auditor tests the control effectiveness and documents the findings in a report. The report highlights any areas of non-compliance and serves as an audited assurance of the organization’s compliance status.

Audit reports are tangible proof of an organization’s commitment to compliance. They help build credibility while ensuring the protection of sensitive information.

Sprinto can help you manage compliance:

• Automatically map compliance requirements to controls while also identifying common requirements across frameworks
• Leverage security policy templates, training modules, role-based access management, and centralized document management to power your compliance program.
• Get automated alerts for any compliance issues for proactive management
• Use 200+ integrations and custom APIs to enable granular-level compliance monitoring and automatically collect evidence
• Use the independent audit dashboard to create your internal or external audit window and collaborate with the auditor

4. Other interrelated requirements

The following requirements are also deep-rooted in GRC, but because of their interconnected nature, they cannot be categorized under one component. These requirements are common to the three elements.

Let’s look at the additional GRC requirements:

Training and awareness

Training and awareness are integral to the success of a GRC program. They help drive organizational success by ensuring risk-aware, skilled, and cultured employees.

• Governance relies on well-informed employees and so training under the governance component ensures that employees are aware of their roles and responsibilities.
• Risk mitigation requires employee training to identify and report cyber threats to the IT department.
• Compliance requires mandatory security training to ensure adherence to frameworks such as GDPR, HIPAA, PCI DSS, etc.

Third-party risk management

Third-party risk management involves overseeing and managing relationships with vendors and suppliers and assessing the risks involved.

• It is integral to the governance framework as it helps ensure vendor relationships align with strategic objectives. Governance develops policies and procedures for vendor selection, due diligence, and monitoring.
• Third parties carry risks of breaches and attacks, and the risk management component assesses risks related to these relationships. The vendors are categorized as high, medium, or low based on the criticality of the information they access, and assessments are carried out accordingly.
• Many frameworks require third parties to adhere to regulatory requirements and these are mentioned in their contracts. The organization must regularly ensure that the third party continues to comply with these regulations.

Business continuity planning

Business continuity planning is yet another interconnected component of GRC. It involves having a backup plan to minimize downtime after an unexpected event and promotes a proactive approach to crisis management.

• For effective governance, business continuity planning ensures the organization has a strategy for unexpected times. The governance body is responsible for overseeing and approving the BCP.
• It is crucial to manage risks involved with business disruptions and ensure recovery and restoration processes.
• Many compliance frameworks require a BCP aligned with industry standards and regulations such as ISO 27001 or PCI DSS.

Change management

Change management is a set of practices that help the organization implement changes to procedures or systems in a systematic manner while actively avoiding disruptions and ensuring business continuity.

• The policies for change management are developed at the governance level, and the body also oversees their alignment with existing policies and procedures
• Any risks associated with the changes are assessed, and strategies for mitigation are developed to minimize the impact
• Change management must also align with regulatory requirements, and proper documentation of change requests, the approval process, and implementation must be provided.

Why is GRC implementation so crucial?

GRC implementation is crucial for enhancing organizational efficiency and enabling teams to make risk-informed decisions. It supports cybersecurity and compliance processes, improves stakeholder relationships, and aligns everything with strategic priorities.

Check out more reasons as to why GRC implementation is crucial:

Risks are interconnected

Risks don’t occur in isolation, and more often than not, one event triggers a chain reaction. A compliance risk, for example, brings financial and reputational risks. The interconnected nature of risks requires a comprehensive approach that comes with effective GRC implementation. It enables holistic risk assessments, integrated risk mitigation plans, and better collaboration across departments. This helps minimize the cases of smaller events turning into a crisis.

Stakeholder engagement matters

One of the key advantages of GRC is that it eliminates departmental and data silos. Your stakeholders, including employees, clients, partners, and investors, have a substantial stake in the organization’s GRC efforts.

GRC implementation ensures transparency in communication and helps build trust with stakeholders as everyone’s concerns are addressed. This contributes to building a GRC culture and ensuring the organization’s long-term success.

Enterprise clients are looking for it

Effective GRC implementation is a differentiator in the marketplace as it indicates well-structured processes and rigorous compliance and security standards. Clients are assured of keeping their data safe, smooth operations, accountability, and compliance with regulations. This helps you bag more enterprise deals and capitalize on your credibility.

Helps build security maturity

At the onset of your GRC implementation, processes may be haphazard, with limited integration across various functions. However, as GRC efforts accumulate over time, you will see increased security maturity in these processes. The organization becomes better equipped to respond to challenges, governance processes are enhanced, and compliance is more effectively maintained.

Sprinto is the only next-gen GRC tool you need

GRC implementation requires a single source of truth for data and process management and comprehensive visibility. There are better ways to scale GRC efforts than spreadsheets and email chains. Forward-thinking organizations have realized the need to shift to next-gen GRC tools that do the heavy lifting for them. Sprinto is among the top players in this category.

The automation-enabled and integration-powered platform is agile and flexible to help you solve unique GRC needs. It embeds seamlessly with your tech stack, accommodating new data sources and increased volume as you scale. The platform helps you build a connected view of risks and controls and automate control testing and evidence collection.

Features like in-built policy and training modules, zone-wise compliance management, common control mapping and seamless internal reviews and external audits make Sprinto the most agile platform with a short learning curve.

Speak to our experts to kickstart your GRC journey with Sprinto.

FAQs  

What are legacy and modern GRC tools?

Legacy GRC tools are traditional software and systems characterized by manual processes, limited integrations, and on-premise deployment. Modern GRC tools are advanced, integrated, and automated solutions that streamline and enhance GRC processes. They are flexible, scalable and offer real-time analytics. Some examples of modern GRC tools include Sprinto, ServiceNow, and OneTrust GRC.

What are some GRC challenges organizations face?

Some common GRC challenges include integration issues, reliance on spreadsheets and manual processes, complexity of regulations, scaling GRC processes, resource constraints and evolving threats.

How to implement GRC?

To implement GRC, you must:

• Identify the implementation areas and create a roadmap
• Establish governance structure
• Identify and assess risks
• Develop policies and procedures
• Begin with the implementation of policies
• Monitor and report

You can use GRC tools to automate the process.