Introduction

In today’s fast-paced and ever-evolving business landscape, implementing and maintaining effective Governance, Risk, and Compliance (GRC) programs is more crucial than ever. Companies of all sizes are facing increasing regulatory pressures, audit requirements, and complex processes, which can result in a substantial financial burden if not managed properly. The importance of having a well-oiled GRC machine in place cannot be overstated, as it enables organizations to navigate risks and maintain regulatory compliance, while ensuring informed business decisions. However, building and sustaining a robust GRC program can be costly, consuming valuable resources.

According to a GRC industry survey by Thomson Reuters, 60% of companies expect GRC-related costs to rise, with compliance costs outpacing profits for 45% of organizations. The big question is, how can your organization balance the dual imperative of achieving cost-effectiveness in your GRC program while ensuring it remains effective?

The Foundation of Cost-Effectiveness in GRC: Process Standardization

Achieving cost-effectiveness in your GRC program starts with process standardization. This involves streamlining GRC processes, removing inefficiencies, and duplicative efforts across departments, thereby fostering a greater sense of collaboration among compliance, risk management, and governance teams.

One of the significant areas that offer considerable cost-saving opportunities is compliance management. Implementing a compliance program requires substantial investment of time, resources, and personnel. Managing compliance internally requires a team of dedicated compliance professionals, auditors, and support staff.

To minimize this demand on your financial and human capital, standardize and harmonize the regulatory policies. Standardized processes free up staff members to focus on high-value strategic work that yields superior return on investments and accelerates the quality of decision making.

By standardizing all policies, procedures, processes, and systems across departments, you ensure a high degree of GRC efficiency and enhance trust through demonstrated excellence. The best part is that a robust policy management program delivers improved scalability, faster time to approval, lower overall cost, and better compliance posture.

According to a report by McKinsey, companies that have standardized their processes have increased productivity by around 15 to 20% per year.

GRC Cost Savings Strategies through Risk Management Integration

To truly maximize cost savings from your GRC program, focus on the following risk management strategies:

  • Automate risk data collection and reporting using technologies like spreadsheets or integrated risk management tools.

  • Combine risk knowledge assessment with risk profiling techniques to understand risk posture, and pinpoint potential areas for further examination.

  • By getting a consolidated view of your business, understand more of inherent risks in multiple layers of the organization, which will strengthen the ability to assess risks and increase the possibility of developing preventative controls.

Integrating the whole system to an entire process and risk assessment (and incorporating risk in core business process) is most sought way for saving and ensuring sustainability on both bottom and top line of enterprise.

With good integration techniques implemented, a Deloitte study suggests an organization can significantly reduce its risk management and compliance costs, with up to a 75% reduction in data quality issues, 50% reduction in compliance costs, and a 20% increase in operational efficiency.

Enhancing GRC ROI through Technology Adoption

Unlock the real cost-effectiveness in GRC with innovative technologies that can yield enhanced cost-effectiveness, efficiency and effectiveness.

Investing in technology to implement GRC is not only beneficial but crucial for GRC programs. Here are some benefits that you may look forward to achieving after implementing the most efficient enterprise practices with the better class of technology support system:

  • Cost Efficiency: Boost reduction in the compliance cost incurred while fulfilling growing regulatory compliance needs for organization of all size.
  • Lowering operation Costs with reduced Risk Management Costs results more Earning per shares.
  • A streamlined process, Increased visibility within each process implementation.

According to a Deloitte study, organizations with high levels of GRC automation have seen improvements such as 40% increased efficiency, 41% risk reduction, and a potential 27% increase in overall revenue.

Scaling Your Cost-Effective GRC Program with Shared GRC Expertise

As your cost-effective GRC program gains momentum, implementing shared GRC knowledge and integrating core resources becomes essential for sustainable growth.

A major benefit of having GRC professionals and teams is a structured training program and developing skills further in Governance and Auditing. Leverage expert resources, either inter or intra organizational team, best fit to the objective and drive best strategy approach leveraging cost benefits to the best positive results. These all can lead to reducing corporate resources wastage.

Research provides a cost-saving report for various areas where shared GRC expertise is helping organizations save a pretty penny. Organizations with a moderate to high level of risk and compliance maturity achieved cost savings of around 12-15%. Overall increased productivity through compliance process improved by over 21%. Cost is also reduced to just over 60% for every single compliance activity through sharing and coordinating GRC expertise.

Conclusion

Effective Governance, Risk, and Compliance (GRC) programs form the backbone of any organization that is looking to reach new heights in compliance management and risk reduction. On average, organizations have around 15000+ GRC activities to manage annually to stay in regulatory compliance.

In the current environment, there is much focus around corporate governance. GRC activities increase each year as more regulations surface and maintaining cost effectiveness. There are no two thoughts on a statement of increasing regulatory needs for companies of all sizes. Despite size of the company, companies need to implement best-class GRC and core industry practices.

If you have thoughts about the future of GRC programs for organizations of all sizes, or any other aspect that you’d like to discuss, we’d love to hear them. Please leave a comment below to start a conversation.