Academic scholars define GRC as an integrated framework that enables enterprises to achieve their growth reliably while addressing uncertainty and abiding by social and economic integrity expectations. That is just academics though. We shall examine the practical meaning of GRC and probe into some of its workings that transcend over just business. This is a constantly changing part of business that needs to be ahead of the game for potential problems. The initials GRC stand for governance, risk and compliance. The three components of GRC are related, and they overlap in institutional influence.
All institutions, profit or non-profit, exist to make some impacts in the world for the benefit of stakeholders or targeted individuals. For the impact to be achieved and sustained, such institutions must have governing philosophies and mission statements.
Unfortunately, in a robustly competitive and adversarial world, every institution faces inherent risks that could prevent its success and growth. In fact, some of the risks could devastate institutions, especially if they manifest out of non-compliance to external factors like societal expectations or legal regulations. This is where executives, managers and administrators realize just how integrated and cohesive governance, risk and compliance are.
The Rise of GRC
GRC software and supporting hardware began rising in popularity immediately after the global community transitioned into the twenty-first century. Coincidentally, the world was taking its first firm baby steps into the internet era. A relatively good number of locals had gained access to computers. Most serious businesses had established IT systems.
Even more people had the intention of accessing the internet via their mobile devices. Unfortunately, that is the time when cyber-crime took a sharp rise and led to the devastation of companies that lost customer data to hackers.
A series of lawsuits and public shaming ensued and led to the collapse of very promising and helpful businesses. As Congress and judiciary proceedings continuously instituted legal implications placing fault on companies for customer data losses, cyber experts designed GRC systems to help businesses out of the nightmare through which they were going.
The Components of GRC are
Your business needs you and your management staff to make policies and issue instructions that increase operational efficiency and reduce risk. Note that governance manages risk and compliance. Therefore, GRC software should integrate your missions, goals and aims in the way your IT department helps to disseminate information via all the departments of your business. That means that through your proper software and physical communication, you can control and monitor how each and every member of your staff conducts your business.
The software should root out all data silos in your communication systems. It should furnish every one of your employees with company expectations, to-do lists and conduct regulations.
Through GRC system design, you can predict all the potential threats to the legal, social and economic welfare of your business. Through streamlining online communications among all your staff members and the top brass management members, your business can survive any looming disasters through decisive action. For that, the business must operate in impeccable integrity. It would be difficult to coordinate risk-averse interventions if you did not have GRC systems that eliminate all informational silos.
Compliance laws are so many and mutating that you most probably find it hard to keep up. GRC systems help you to stay within the bounds of social and legal law so that you don’t have to plead ignorance. In law, ignorance is never an admissible defense. You can’t keep reading legal gazettes every day, and your subordinate employees probably don’t at all. That is the reason why an efficient and customized GRC system could be ideal for your business.