Too little, too late: The avoidable governance, risk and compliance tragedy
"It will never happen to us." Why is it that corporate organisations live by this notion? "Steinhoff JSE meltdown"... "Liberty hack the biggest breach yet".
"EOH suspends employees, and implements whistle-blowing solution related to Microsoft scandal, yet the damage was already done, the share price has already plummeted."
As long as CEOs and other top-line executives continue to sideline the implementation of integrated governance, risk and compliance (GRC) strategies, supported by the right technology platform, we will continue to see this ongoing 'management by crisis'.
Again and again, corporates wait for the walls to come tumbling down before they begin to comprehend the reality that GRC activities are a fundamental and critical aspect of business success, and need to be integrated throughout the organisation at all levels.
A reactive approach, putting out the risk and compliance fires instead of planning to prevent them in the first place, is a dangerous way to run an organisation, as history has shown.
Challenge to boards, executives and risk management professionals
Organisations take risks all the time, but fail to monitor and manage risk effectively in an environment that demands agility.
Risk management in the modern organisation is:
* Distributed. Complexity grows as these interconnected relationships, processes and systems nest themselves in intricacy.
* Dynamic. Organisations are in a constant state of flux, as distributed business operations and relationships grow and change.
* Disrupted. With big data comes 'big risk data'. The velocity, variety, veracity and volume of risk data is overwhelming, disrupting the organisation and slowing it down at a time when it needs to be agile and fast.
* Accountable. It is part of the executives' and directors' fiduciary obligations to oversee risk management as an integrated part of business strategy and execution.
Understand the interrelationship of risk and its impact
Risk is pervasive; there are a variety of departments that manage risk with varying approaches, models, needs and views on what risk is and how it should be measured and managed. And they all need to be considered.
When organisations approach risk in scattered silos that do not collaborate, there is a larger risk exposure than each silo is independently aware of. It is critical that all roles are working off the same data, and that this risk data is clean, reliable and timely.
Providing 360^0 contextual awareness of risk
Biological ecosystems are complex and interconnected, and change in one segment has cascading effects and impacts to the entire ecosystem.
Dissociated data, systems and processes leave the organisation with a fragmented view of performance, risk and control across the enterprise and how it supports the organisation's strategy and objectives, holistic visibility and 360^0 contextual awareness are vital!
GRC needs to be put into the context of the business and its operations
The organisation has to be empowered to be able to see the bigger picture. Siloed, decentralised systems just increase the risk exposure and open the door to crisis type situations. It is only through an integrated GRC strategy that is fully entrenched and embedded, with the right integrated tools, within each level of the organisation, that key individual decision-makers will start to see the tree (the individual area of risk) within the context of the forest (the interconnectedness of risks). This then allows even deeper views, staying with this analogy, to be able to pinpoint the exact leaves on which branch are creating risk exposure and potential crisis, and thus empowering such decision-makers to act intelligently before it all really goes wrong.
Organisations need a command and control hub that provides the analytical capability to ensure early warning of emerging risk issues and ongoing measurement and monitoring across a connected view of risk.
RUBiQ: A robust, advanced and content-rich platform created to ensure your organisation proactively manages all relevant aspects of governance, risk and compliance, rather than 'management by crisis'.
Cost-effective and easy to use, the RUBiQ platform and supporting tools will help you avoid being the next EOH, Steinhoff, Liberty...
Find out how, now.