Organizations have acknowledged the emergence of governance, risk, and compliance as the governing benchmark in modern business. Still, too many consider GRC as a checkbox or a means of avoiding fines. That thinking places GRC in a constrained and backward-looking role. The fact is that GRC can be a potent enabler of strategy and business to drive long-term success and innovation. In this blog, we explore how organizations can move beyond just compliance, towards using GRC as a critical aspect of their business strategy.
Understanding GRC: More Than Just Compliance
GRC, or governance, risk, and compliance, is an umbrella approach that assists an organization in managing risks and regulatory requirements while ensuring good governance practices. It's a complete framework that knits these three essential areas together into one coherent strategy.
However, many organizations treat GRC as a siloed function focused solely on compliance. In this mode, they develop policies and put controls in place in response to regulatory requirements, but the broader ramifications of doing so remain poorly understood. This could be the narrow approach leading to missed opportunities for growth, innovation, and competitive advantage.
The Strategic Value of GRC Compliance
With a more strategic approach to GRC, organizations can capture a lot more value on many dimensions. Here's how GRC can serve as a strategic enabler:
- Smoothening of Operations: GRC compliance, when integrated into the core processes of a business, embeds risk management and compliance within day-to-day activities, hence making operations smooth. This proactive positioning shrinks many redundancies and inefficiencies, ultimately easing the operation of organizations considerably. Besides this, businesses may reduce hours and resources spent on manual tasks pertaining to compliance because GRC processes are automated.
- Better Decision Making: A Good and strong governance risk and compliance framework will provide full visibility of all risks and opportunities. This renders the capability for making better decisions that support the attainment of the strategic objectives. Suppose, for instance, a business understands the risks involved in expanding into a new market. Those same businesses can take measures to avoid many of their pitfalls while seizing growth opportunities.
- Driving Innovation: Contrary to popular opinion, governance risk and compliance framework does not hamper innovation; instead, it fuels it. Since one knows the risks and has managed those from an early stage, the organization confidently goes after audacious ideas in innovation. With a robust GRC strategy, a business can take risks, knowing full well that mechanisms are in place to address challenges.
- Building Stakeholder Confidence: Trust is one of the topmost valued currencies in business life today. A working GRC program serves as a sign of an organization's commitment to ethical practices and good governance that would inspire confidence in a wide array of stakeholders, including customers, investors, and regulators. This results in higher relationships with greater loyalty of customers and better access to capital.
- Creating a Culture of Accountability: A good GRC compliance program inculcates into the organization a sense of accountability. When employees realize that compliance and risk management are significant and crucial, they take ownership and, hence, become accountable for their actions. The cultural changes in employees will reduce the likelihood of compliance violations, coupled with providing ample avenues to engage employees as contributors toward organizational success.
Let’s Sum Up
As business organizations face increasing complexities as well as uncertainties, the role of GRC has never been more critical. Moving beyond mere GRC compliance and embracing GRC as a strategic business enabler propels an organization toward effective risk management, successfully grasping opportunities, and building a resilient future. This requires realizing that GRC, when fully integrated into the business strategy, is not about avoiding penalties but driving long-term value and competitive advantage.
Let INTERCERT help your organization survive and thrive in today's complex regulatory environment. We provide a broad range of GRC-related services, including management system certifications, training, and professional certifications. Therefore, contact INTERCERT now and learn about the strategic advantages of a strong GRC program.