Governance, Risk Management and Compliance: Top Business Priorities

GRC has become a top business priority. The trend toward improved corporate governance is seen in many initiatives, including the following:

1. Protecting corporate reputation and brand value
2. Meeting the increased demands and expectations of investors, legislators, regulators, customers, employees, analysts, consumers and other key stakeholders
3. Driving value and managing performance expectations for governance, ethics, risk management and compliance
4. Managing crisis and remediation while defending the organization, its executives and board members against the increased scope of legal enforcement and the rising impact of fines, penalties and business disruption
5. Exercising good corporate stewardship and discharging fiduciary duties in a transparent and proactive manner

Organizations are required to address the impact of these initiatives. Some may have had a positive experience in terms of GRC, but are unsure about their ability to maintain their position in a rapidly changing environment. Industry studies show that many organizations believe they are not positioned to effectively meet increased stakeholder demands on a sustainable basis.

An integrated approach to GRC should be taken. Organizations addressing each GRC area in a different way are likely to experience significant cost increases and duplication of effort. Taking a reactive, backward-looking approach to GRC could negatively affect efficiency and make the implementation of proactive, process-driven initiatives difficult, if not impossible.

Good governance is about setting strategy, managing risk, delivering value and measuring performance. A strong GRC framework ensures that the interests of stakeholders are adopted and implemented by management and staff members throughout the organization. Such a framework is the foundation of managerial integrity, making the best use of corporate assets and intellectual capital, and understanding and managing risk. All parts of a GRC framework are important components of good corporate governance.