Would your risk documentation hold up in court?

In today's increasingly litigious environment, risk and compliance professionals face the challenge of effectively defending their governance, risk, and compliance (GRC) management practices.
 
Regulators and auditors not only demand evidence; they require a comprehensive trail of activities associated with it. They don’t just want to see evidence of a change – they want to see evidence of who made the change, when, where, and how.
 
Spreadsheets and emails have long served as go-to tools for organizing and documenting risk and compliance-related information. But they come with inherent limitations that may hinder effective defence in a legal setting. Static spreadsheets can be prone to errors, manipulation, and version control challenges, while emails can be easily misinterpreted or taken out of context. That’s why neither of these tools are good enough to defend your GRC management.
 
As a compliance or risk manager, it’s essential that your GRC program is defensible and can withstand legal challenges. Are you confident your risk documentation would hold up in court? (If not, you’ll want to read on.)
 

What is defensible GRC?

 
According to the GRC Pundit himself, Michael Rasmussen, defensible GRC is critical in the current litigious environment. His definition of a defensible GRC system of record is one that incorporates all the below capabilities.
 

• Version control, including date & time
• Be able to ask and resolve questions
• Understand context
• Provide auditable records
• Meet requirements
• Manage exceptions
• Repeatable cycle
• Demonstrate sequence

 
If you want to be prepared for any legal challenge, you need to make sure that you have a system in place that can track and document all your activities. This means using software that can provide a comprehensive audit trail of all your actions, so that you can easily demonstrate your compliance with regulations and laws.

Critically, defensible GRC requires tracking of all the interconnected factors as they impact each other. This can only be done if GRC is managed in a single, integrated system. 
 
An all-in-one GRC platform allows you to track and document all activities in a single place, providing comprehensive audit trails that can be easily used to demonstrate compliance with regulatory requirements and legal obligations.
 

The growing shift toward accountability

Recent years have seen more emphasis put on accountability, with accountability regimes growing around the world. Whether it’s the UK’s Senior Managers and Certification Regime (SM&CR), Australia’s Financial Accountability Regime (FAR), or Hong Kong’s Manager-In-Charge Regime, they all have one thing in common: Individuals are accountable across management functions, and if there is wilful misconduct, you can go to jail. 

Accountability is not the same as responsibility. Where you can outsource responsibility for a task, you cannot outsource accountability. Organizations are increasingly held accountable across their entire supply chains, which recently has expanded to include areas of Environmental, Social & Governance (ESG), like modern slavery. Germany’s Supply Chain Due Diligence Act requires organizations to make sure ESG standards are observed across their entire global supply chain, and take action if violations are discovered.
 

Evidence of forward-facing risk management

A renewed global interest in areas like operational resilience shows just how irrelevant tick-box compliance is becoming. Today, there has to be evidence of preparation for situations that haven’t even occurred yet. Scenario planning needs to be done proactively so organizations are ready for any type of disruption.

Regulatory mandates, like the UK’s Financial Conduct Authority (FCA) standards for Operational Resilience, the European Commission’s Digital Operational Resilience Act (DORA), and the Australian Prudential Regulation Authority (APRA) CPS 230 standards all demonstrate this shift. 

Organizations must understand and evidence that if any critical system is disrupted, they can continue to operate without serious impact to their business or customers. Learn more about demonstrating operational resilience here.
 

Protect yourself from legal challenges

 
Within this increasingly complex and litigious context, risk and compliance professionals must go beyond relying solely on static spreadsheets and emails for GRC management. Meeting the requirements of the expanding risk landscape requires replacing multiple legacy risk management solutions with a single, integrated platform, like Ansarada’s GRC software.

Ansarada GRC allows you to manage regulatory compliance, risks, controls, events, contracts, policies, and more in a centralized space. Everything is interconnected, so you can track incidents and manage associated risks across your entire organization, keeping value protected and maintaining full visibility. 360-degree GRC.
   
Organizations can leverage technology to strengthen their defense strategies. Embracing robust compliance systems and utilizing data analytics tools can enhance transparency, accuracy, and agility in responding to regulatory demands. By staying ahead of the curve, risk and compliance professionals can navigate legal challenges with confidence and demonstrate their commitment to sound GRC practices.