While strong governance, risk, and compliance (GRC) capabilities are important for today’s businesses, effectively demonstrating the performance of a GRC program can be a challenge. The lack of commonly understood risk metrics and difficulty aligning internal stakeholders and goals can make it hard to articulate the value of GRC in a way that resonates with C-suite executives, board members, and other business-minded leaders. Talking about GRC in abstract terms isn’t good enough – risk leaders need to be able to clearly tie program initiatives to financial outcomes.
This disconnect can be challenging. Risk professionals lack financial qualifications, while business leaders are often unfamiliar with the complex and – let’s face it – confusing terminology that surrounds risk and compliance. Tying GRC activities to real-world financial outcomes allows risk professionals to bridge this communications gap by illustrating their impact on the organization’s bottom line in a way that can be easily understood by business leaders. With the value realization tools in place, GRC teams and business leaders can speak the same language, fostering stronger relationships and ensuring alignment with broader business goals.
Speaking the Language of Business
A strong GRC program is an investment in the overall health of the business. Some businesses operate under the misconception that GRC is about little more than checking a few compliance boxes, but nothing could be further from the truth. GRC isn’t just about compliance—it’s about understanding and quantifying risk across the entire organization, allowing business leaders to make informed, risk-aware decisions. Yes, part of that means ensuring the business is aligned with relevant regulations and compliance frameworks, but it also means establishing context. If the business wants to expand into a new geographic area, what new laws will it need to comply with? What will it cost to become compliant? Will it require significant operations changes, and will those changes come with risks? A strong, holistic GRC program ensures that key decision makers have that information (and more) at their fingers.
But the success of such a program depends on the ability of risk professionals to convey their findings to business leaders. After all, GRC teams need to generate buy-in at the highest level if they’re going to recommend significant changes. And while security or GRC professionals may find meaning in complex, technical metrics, business leaders are unlikely to find them as useful. Most CEOs or CFOs don’t want – or need – to know how closely aligned the organization is with the SOC 2 framework. They want to know the impact on the bottom line. What will it cost to achieve full compliance? How much business will they lose if they aren’t compliant? What will a quick and easy fix cost as opposed to a more long-term solution? When GRC teams can produce straightforward answers to those questions, they can help business leaders quickly and easily understand what they need and why.
Fortunately, today’s organizations can gather that data more easily than ever. The rise of automation has provided businesses with a way to quickly, accurately, and reliably gather and correlate data from across the enterprise – which means businesses can gain unprecedented visibility into the value of GRC by tracking key program initiatives in real-time. They can detect resource inefficiencies, track revenue enablement, and engage in proactive risk reduction by tying potential risks to positive and negative outcomes. This allows risk professionals to optimize the program’s performance over time while providing business leaders with the contextualized information they need to make risk-aware decisions with business objectives in mind. By prioritizing value realization, risk professionals can convert GRC metrics into clear financial outcomes, allowing business leaders to more easily see and understand the real, tangible benefits of a strong GRC program.
Generating Positive Outcomes
Value realization is a critical element of a modern GRC program—not just because it helps justify risk-related expenditures, but because it provides GRC professionals with a way to contextualize their needs in a way that makes sense to more business-minded leaders. By framing GRC in terms of financial outcomes, GRC professionals can demonstrate how certain initiatives and decisions will impact the organization's bottom line. With risk and compliance becoming increasingly important amid the evolving regulatory landscape, that’s a critical tool for GRC teams to have at their disposal - and they never had it before.
Authored by: Matt Kunkel, CEO, LogicGate
