A recent survey shows that in times of increasing regulatory pressures only a third of businesses think they have robust processes in place to manage governance risk and compliance (GRC), writes Linda Endersby.
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The survey, by Software AG, provider of Business Process solutions, gathered at a recent GRC webinar also revealed that over half the respondents are yet to implement a co-ordinated 'single version of the truth' response, using a fragmented approach to regulatory compliance and a poor tenth were confident that their firm operated an integrated GRC and audit processes based on a common platform.
"Many of today's businesses operate in heavily-regulated environments, yet try to get by with essentially siloed, spreadsheet-based compliance processes, with no centralised control or end-to-end accountability," said Simon Pritchard, head of financial services for Software AG UK.
Pritchard went on: "At best this is inefficient, resulting in an unnecessarily high cost of compliance, at worst this leaves a dangerous perception gap between the reality of day-to-day business operations and what risk and compliance functions believe they should be monitoring."
Recent research by Ernst & Young demonstrated that there is a definite relationship between mature risk management practices (including technology solutions) and financial performance, with many risk programmes becoming self-funding and even generating positive returns.
"In addressing key aspects of operational risk, financial control and reporting and regulatory compliance a best practice response should adopt an automated, process-oriented GRC approach based on a robust enterprise platform. This reduces the cost of compliance and leads to better, more-informed decision-making," says Pritchard.
Looking ahead, just under half of webinar participants were looking at continuous controls monitoring as a priority in implementing GRC initiatives over the next two years, with another 40% looking to make audits easier, faster and more cost-effective.
"The most forward-looking companies recognised the importance of incorporating effective GRC processes as 'business as usual,'" concluded Pritchard. "As a constantly-changing regulatory landscape requires them to engage in an on-going cycle of risk assessment, documentation of controls and processes, testing and addressing identified compliance shortfalls."