An increasing number of companies are turning to governance, risk, and compliance (GRC) consulting as part of a broader and more proactive risk management strategy. Many have attributed this shift to the COVID-19 pandemic because this event highlighted the need to adopt a more aggressive stance on risk management.
The reality is that legal and regulatory violations represent a major threat to an organization’s financials, reputation, and even a company’s very future. This makes GRC-related matters a significant component of the broader risk management landscape.
But what is GRC consulting, exactly? And how does a GRC consultant benefit a company and its operations?
What is Governance, Risk, and Compliance (GRC)?
To appreciate the role of a GRC consultant, you first need to understand the concept of GRC and why it’s increasingly relevant in today’s business world.
At its very core, governance, risk, and compliance — GRC — encompasses three concepts and the relationships between those concepts.
- Governance refers to an organization’s policies, procedures, and actions, particularly as they relate to laws, regulations, and other similar mandates.
- Risk refers to the numerous risk factors and vulnerabilities that threaten an organization and its interests, employees, customers/clients, and operations. These risk factors are considered as part of a company’s risk management strategy.
- Compliance is a reference to the organization’s legal and regulatory compliance.
In an increasingly competitive business world, effective risk management practices are a key element for success. It has become very clear that these GRC concepts are central elements that stand at the core of a strategy for managing and mitigating risk. But how do you put it all into action? Enter: the GRC consultant.
What is GRC Consulting?
GRC consulting is a dynamic, multi-faceted engagement that is focused on evaluating a company and its GRC-related practices, identifying pain points, developing a GRC strategy and finally, implementing that strategy with a solid action plan. The ultimate goal is to achieve and maintain full regulatory compliance, while simultaneously reducing risk both today and in the future.
When seeking governance, risk, and compliance consulting services, it is fair to expect a multi-month engagement. This allows for a full discovery process, with your consultant (or consulting team, as the case may be) guiding the way as you develop a GRC strategy and then put that strategy to work for your company.
What is the GRC Consultants’ Process?
Each GRC consultant has their own unique process and philosophy when it comes to governance, risk management, and compliance. That said, most will follow the same basic formula when it comes to process.
Evaluate – The GRC consulting process usually begins with a thorough evaluation of the organization and its operations, objectives, challenges, risks, and threats. The goal is for the consultant to gain a solid understanding of the company and its relationship with the surrounding risk management landscape. Only then can a consultant begin to address the related issues of regulatory compliance and governance.
Identify the Risks – The next step is to identify the most pressing threats to the organization and its interests. These risk factors can range from a problematic business practice that may lead to costly fines and penalties for non-compliance, to a lack of data management tools which could result in an inability to prove compliance if the need arises. Once the risks are identified, the GRC consultant will prioritize them, with the most serious and potentially-problematic issues to be addressed first.
Plan – Your GRC consultant will spearhead the development of a strategy and action plan for addressing governance, risk, and compliance-related issues within your organization. This plan will have actionable steps and usually, there is a plan for continued monitoring or periodic re-evaluation in an effort to maintain the gains that are achieved. In this stage of the GRC consulting process, most consultants will take the time to understand a company’s policies, procedures, and practices as they relate to legal/regulatory compliance and risk management as a whole.
Execute – A good GRC consultant will stand beside their client as they execute their action plan. Notably, this is one stage of the GRC consulting process where the right software can be very useful. GRC software — which we will explore in a bit — usually includes useful project planning-type features that allow you to assign tasks, collaborate and track task progress/completion.
Monitoring – The last step of the GRC consulting process is to establish a plan for the future. This usually includes re-evaluation of past problem areas and a process for monitoring the GRC landscape within your organization and beyond.
GRC Software as a Consulting Tool
Many GRC consultants encourage their clients to leverage tools such as one of the many governance, risk, and compliance software platforms. GRC software is designed to streamline processes such as identifying problem areas and putting a GRC strategy into action.
Similar to project management-type software platforms, GRC software systems usually include several key features, including the following.
- Risk identification and assessment tools.
- Response planning tools (similar to what you’d find in a project management software platform).
- Tools to monitor identified risks, threats and regulatory compliance.
- Alerts regarding new or modified laws or regulatory requirements.
Legal and regulatory compliance looks a bit different for every organization; it depends upon factors such as your industry, location and business type. But there is one constant reality that spans it all: non-compliance can be very costly. Non-compliance is costly from a financial perspective, from a strategic perspective and from a public relations perspective. But with good GRC consulting, you can achieve full compliance in a way that will improve your risk management positioning.
When you combine GRC consulting with the right technology — such as governance, risk and compliance software — an organization can successfully avoid non-compliance and the resulting fines, penalties and losses. This is one area where iTech can help because we provide comprehensive risk management solutions to companies in all industries.
We invite you to contact the team at iTech today. We look forward to discussing your GRC challenges.