Marlowe GRC is a customer of Business Reporter.
The days of straightforward business practices are long gone – now, we exist in a constantly changing, unpredictable, intricate, and unclear world.
The WEF expressed it clearly: “As instability increases in various areas simultaneously, the potential for multiple crises also intensifies.” This ominous forecast implies that political and economic instability could result in intricate and widespread global risks.
In today’s world, it is crucial to prioritize governance, risk, and compliance (GRC). According to the Open Compliance and Ethics Group (OCEG), GRC is the ability to effectively achieve goals, navigate uncertainty, and uphold ethical standards. As such, it plays a crucial role in assisting leaders in navigating the challenges of modern business environments.
The coming together of GRC, EHS, and ESG.
In the current environment, organizations are striving to achieve and fulfill environmental, social, and governance (ESG) objectives.
However, how do environmental, health, safety (EHS), and governance, risk, and compliance (GRC) collaborate?
The merging of these three fields has become increasingly significant in the corporate realm, with sustainability and social responsibility being crucial subjects.
This is the way in which they intersect.
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Reworded: The concept of environmental sustainability is closely linked to EHS initiatives aimed at minimizing environmental effects, promoting sustainability, and adhering to regulatory standards. GRC structures aid in incorporating environmental objectives and compliance into corporate governance.
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The risk management aspect of GRC is closely related to EHS, as it deals with risks related to the environment and safety. These risks are important factors in evaluating ESG performance.
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Ensuring adherence to environmental laws and fulfilling ESG reporting obligations often intersect. Companies must have strong governance, risk, and compliance procedures in place to fulfill their legal responsibilities and provide accurate ESG performance information to stakeholders.
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The expectations of stakeholders, such as customers, investors, regulators, and communities, are shifting towards a desire for transparency, ethical conduct, and sustainability efforts. These values are crucial to ESG and should be incorporated into GRC and EHS practices.
By combining GRC, EHS, and ESG, companies can more effectively navigate the intricate obstacles of the contemporary business environment.
What is the direction of the world?
The 2023 Global Risks Report by the WEF categorizes risks by severity for a duration of 10 years. Out of the top ten risks, six pertain to environmental issues, two to societal concerns, and one each to geopolitical and technological categories.
This stresses the significance of ESG and its alignment with GRC in order to effectively handle the unpredictability of these potential hazards.
What are the future expectations for GRC in business?
The upcoming changes and advancements in governance, risk and compliance (GRC) are expected to greatly impact its future.
In this section, we discuss ten important subject areas that illustrate the changing business world, regulatory climate, and technological progress.
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The implementation of digital technology is causing organizations to automate their processes and utilize data more extensively. This trend will also lead to the incorporation of artificial intelligence, machine learning, and data analytics into GRC processes, making risk assessments, compliance monitoring, and decision-making more efficient. Through AI-powered predictive analytics, organizations will be able to anticipate and handle potential risks. By the year 2030, GRC processes will be largely automated and integrated with AI and ML systems.
- Holistic business integrated GRC: business-integrated GRC will be the standard approach to managing risks across organisations. It will encompass financial, operational, cyber, compliance, ESG and other risk domains within a unified framework. Real-time data and analytics will provide a comprehensive view of risks, enabling organisations to make informed decisions.
- Regulatory complexity: regulatory requirements are becoming more complex and dynamic, especially in sectors such as finance, healthcare and data privacy. GRC systems will need to adapt to these changes and provide real-time compliance monitoring and reporting capabilities to ensure organisations can meet evolving obligations.
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As cyber threats and data breaches become more frequent and complex, GRC will prioritize managing cyber-security risks and complying with data privacy regulations. This will involve using threat intelligence, ongoing monitoring, and planning for responding to incidents as essential elements.
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GRC practices are increasingly focused on incorporating ESG factors, encompassing environmental, social, and governance considerations. To meet the expectations of stakeholders and comply with regulations, organizations will need to integrate their governance and risk management processes with ESG objectives. Over the next decade, it is expected that organizations will prioritize aligning their governance practices with sustainability goals and closely monitoring ESG performance as a crucial aspect of their GRC strategies.
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The Covid-19 pandemic has emphasized the significance of supply chain resilience and crisis preparedness. GRC will have a vital role in evaluating and minimizing risks related to supply chain disturbances, such as those caused by worldwide crises or political tensions. By 2030, GRC will give priority to preparing for crises, including creating plans to respond to pandemics and developing strategies to handle unexpected disruptions.
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Regulatory technology, also known as regtech, will keep advancing and offering organizations flexible resources to navigate through intricate and constantly changing regulatory environments. These resources will automate compliance responsibilities, provide immediate regulatory knowledge, and streamline reporting processes.
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GRC frameworks will now integrate ethical considerations into governance practices in order to promote responsible business conduct, address ethical dilemmas, and uphold corporate social responsibility (CSR).
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Board supervision: boards of directors will remain essential in GRC, monitoring the organization’s risk management and compliance endeavors. They will require access to comprehensive GRC reports and data analysis to make informed choices.
- A change in culture is necessary to prioritize risk awareness and ethical conduct. Companies must promote a GRC culture that motivates employees to proactively identify and address potential risks. Investing in GRC education and training is crucial for developing a capable workforce equipped to navigate the intricate GRC environment.
To sum up, GRC’s future will be characterized by greater use of technology, consolidation of different risk areas, more intricate regulations, and a significant emphasis on sustainability and ethical conduct in business.
Companies that adopt these patterns and allocate resources to cutting-edge GRC solutions and techniques will have a competitive advantage in navigating the changing demands and possibilities of the business environment.
Marlowe’s GRC division provides a variety of options for overseeing risk and compliance in various GRC categories such as business, property, and human resources. For more information, please visit www.marloweplc.com.
Source: independent.co.uk
