Governance, Risk & Compliance
What is GRC?
GRC stands for Governance, Risk Management, and Compliance. It is a system of strategy for improving a company’s overall governance while managing enterprise risk, and complying with laws and regulations. The acronym GRC was first coined by the OCEG (originally known as the “Open Compliance and Ethics Group) as a “shorthand reference to the critical capabilities used to reliably achieve an organization’s objectives while addressing uncertainty and acting with integrity”. It involves integrating the governance, management, and assurance of performance, risk, and compliance activities. The difficulty is knowing where to start. We can help you navigate through this minefield, and will hold your hand during the process.
Before we get into what makes a GRC plan effective, let’s briefly define first each of the three components:
- Governance – is the process of managing an organization that is designed to ensure that the organization achieves its goals and vision ethically and legally.
- Risk Management– is the process of preventing any unexpected incidents or uncertainties that may affect a company’s performance such as lower earnings or loss.
- Compliance – refers to doing what you are required to do in a particular set of standards, agreements, laws, or regulations. On the other hand, non-compliance is the non-fulfillment of a set obligation.
Why is GRC important?
Majority of the organisations are deciding to implement Governance, Risk Management, and Compliance not just to enhance their defenses against lawsuits and penalties associated with noncompliance, but also to develop more robust business processes that can be managed internally.
Whether you’re running a small business, non-profit, or government organization, you will most likely face the same challenges encountered by large companies in the past. Some of these challenges include the following:
- Stakeholders expect great performance as well as high levels of transparency.
- Keeping up with the latest advancement in technology
- Complying with the constantly changing regulations and enforcement
- The growing risk of a third-party relationship
- The cost of risk management is increasing
- Failure to identify opportunities and threats to your business.
How does GRC Work?
The three components outlined above may work independently of one another, but in the context of GRC, they all assist one another and function as one. This also means that all roles, positions, and different departments must collaborate closely to achieve the desired performance. GRC is basically a shared responsibility of an organization as a cohesive team.
So who is involved?
They could be a senior executive, officer, or employee involved in governance, a business operator with management responsibility, a staff member from the compliance and internal audit department, part of the HR team, IT & security, and so on.
How can we help?
Sounds tedious right? Don’t worry because Lodestar Legal will work with you to determine the best approach for your business. We can assist in the preparation of relevant internal documents, assist with training, work with you to develop systems and processes that deliver change, and help you identify key stakeholders within your business to manage issues (& assist with accountability).
We assist companies of all sizes who wish to reduce their risk, manage shareholder expectations and improve culture.
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