Governance, Risk, and Compliance (GRC) is a dynamic landscape that constantly adapts to evolving economic, regulatory, and organizational realities. The 2008 financial crisis was a stark wake-up call, prompting a global shift towards more robust and holistic GRC programs.
In the West, governments responded with a flurry of regulations enforced by entities like the FCA (UK), ESRB (Europe), and SEC (US). These regulations aimed to prevent future financial disasters by ensuring compliance and imposing sanctions on non-compliant organizations.
The Current Scenario of GRC across Europe
Fast forward a decade, and Europe remains a heavily regulated region. New regulations like MiFID II and GDPR continue to emerge, with Brexit potentially triggering further changes in the UK. However, the European approach to GRC implementation seems to have shifted from widespread adoption to a more reactive stance.
Organizations are now tackling GRC issues, addressing specific concerns like GDPR compliance without necessarily considering the broader GRC ecosystem. In contrast, the West's proactive approach, enforced by entities like the FCA (UK), ESRB (Europe), and SEC (US), has instilled a sense of preparedness and reassurance.
Changing Dynamics of the Middle East
Meanwhile, the Middle East presents a contrasting picture. While regulatory bodies have yet to implement stringent regulations to the same extent, businesses face intense scrutiny from customers and partners. Today's transparency-driven world empowers customers through on-demand news, social media, and platforms like Change.org, demanding ethical conduct from businesses worldwide.
This focus on reputation has become particularly relevant for financial institutions in the Middle East, where anti-money laundering (AML) and terror financing initiatives are under constant global scrutiny. The weight of this scrutiny, intensified by high-profile incidents that have cast a shadow on the region, influences Western investment decisions and underscores the importance of reputation management in the Middle East.
Implications for the Middle East
Banks and other financial institutions in the Middle East often feel a stronger pressure to project a responsible and stable image than their Western counterparts. This pressure often stems from C-suite executives seeking to safeguard the organization's global standing rather than a response to specific regulatory requirements. This holistic approach to GRC, driven by reputation management, sets the Middle East apart from the West's more reactive, regulation-focused model.
The laws in the Middle East limit data movement outside their borders. A GRC system made and operated in the Middle East is necessary to avoid such data restrictions.
Building a Strong GRC Culture and Program
Building a successful GRC program requires an organization-wide approach that fosters employee buy-in. Here are three key changes that can lead to a more robust GRC culture:
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Unify and Integrate GRC Systems
Siloed GRC operations across departments and locations hinder a holistic view of the organization's risk ecosystem. Integrating GRC systems is crucial for standardizing compliance management, taxonomy, and operations. Mapping regulations to global objectives, business processes, risks, controls, and policies help identify compliance gaps and risk patterns across the organization. This empowers decision-makers to assess risks and compliance requirements across various regulations impacting the entire business.
With G50 Lockthreat from CirrusLabs, we have eliminated this tendency within companies by hosting training sessions for all employees within the organization through training the trainer sessions. This helps companies implement integrated GRC with minimal hassles.
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Monitor Internal and External Sentiment
Customer sentiment, particularly in the Middle Eastern financial sector, constantly evolves due to global events. Organizations must stay informed by tracking various intelligence sources, including regulatory agencies, trade associations, and social media. Monitoring internal employee engagement with new GRC programs is also crucial.
CirrusLabs encourages top-down and bottom-up approaches to set up a functional communication system that helps different levels of employees share and communicate with each other. Educating senior employees on how their role contributes to ethical management sets the tone while encouraging employee interaction with GRC systems through recognition schemes fosters user engagement and program improvement. -
Leverage Consumerized Technology
Today's users need more tolerance for outdated, slow enterprise software. Utilizing consumerized GRC technology can ensure active or passive employee engagement with GRC processes. Automating business programs streamlines activities, reduces administrative burden, and frees employee time, boosting productivity and mitigating risk exposure.
Lockthreat: Your GRC Partner in a Changing Landscape
While market regulations are undeniably vital, overregulation (seen in the West) can stifle innovation in GRC. As the Middle East embraces self-governance to meet global investment demands, its GRC programs flourish due to a more holistic approach.
Regardless of location, fostering a strong GRC culture requires commitment and effort. Lockthreat, CirrusLabs' advanced AI-powered GRC platform, helps minimize your worries about compliance and risks.
Lockthreat empowers organizations to:
- Streamline Compliance Processes: Automate manual tasks, centralize data management, and ensure adherence to regulations.
- Proactive Risk Management: Identify and mitigate risks before they escalate, enabling informed decision-making.
- Actionable Insights: Gain real-time insights into your GRC posture, enabling proactive risk mitigation and improved decision-making.
- Enhanced Governance: Enhance your organization's governance practices by fostering transparency and accountability.
Contact CirrusLabs today to learn how Lockthreat can help you build a robust and future-proof GRC program, regardless of your location or industry. Let's navigate the evolving GRC landscape together.