Governance, Risk & Compliance as a Competitive Advantage
Governance, Compliance, and Risk Management:
Building Competitive Advantage for Companies
In today’s complex and rapidly changing regulatory
environment, governance, risk management, and compliance (GRC) have become
fundamental elements for organizational success and continuity. ISO 37301:2021
provides a comprehensive framework for compliance management systems that helps
organizations effectively comply with laws and regulations, thereby
strengthening transparency and trust with regulators and stakeholders. This
article explores the concept of GRC, its importance, and how ISO 37301 can be
applied as an integrated compliance management system. The aim is to provide
practical insights that encourage compliance professionals and corporate
managers in the Arab world to strengthen their skills to ensure organizational
success and sustainability.
What
is GRC (Governance, Risk, and Compliance)?
Governance, risk, and compliance (GRC) is an integrated
strategic model that links regulatory frameworks with organizational objectives
and security challenges. In short, GRC is “the strategy and structure that keep
an organization secure and on track.” In other words, GRC combines three main
pillars:
1. Governance: Establishes a framework that coordinates the work of
different departments, aligns company policies with values and strategic
objectives, prevents duplication and contradictions, and enhances
accountability.
2. Risk
Management: Involves assessing potential risks
(operational, financial, or security-related) and implementing proactive
controls to address them, protecting the organization from unexpected losses.
3. Compliance: Focuses on ensuring the organization meets all legal,
regulatory, and ethical requirements. Compliance management ensures the
organization operates lawfully and ethically.
By integrating these elements into a single methodology, GRC
helps companies reduce waste, increase efficiency, mitigate risks of
non-compliance, improve decision-making, and lower costs associated with
compliance failures.
ISO
37301: Compliance Management System
Definition
and Importance
ISO 37301
is an internationally recognized standard for compliance management systems,
issued by the International Organization for Standardization (ISO) in 2021. It
replaces the previous ISO 19600 guideline, with the distinction of being
certifiable. ISO 37301 focuses on establishing an integrated system that
ensures adherence to legal, regulatory, internal, and ethical obligations.
The standard helps organizations to:
· Ensure
legal compliance by identifying all relevant regulatory requirements.
· Reduce
risks by setting clear controls to address potential non-compliance outcomes.
· Build
trust, as customers, partners, and investors have greater confidence in
organizations certified under ISO 37301.
· Improve
processes by streamlining internal procedures and implementing continuous
monitoring mechanisms, which enhance consistency and efficiency.
· Achieve
accredited certifications that strengthen corporate reputation and expand
business opportunities locally and internationally.
ISO 37301 is also highly flexible, applicable across all
industries and sizes, and easily integrates with other management systems such
as ISO 37001 (Anti-Bribery
Management System) and ISO
9001 (Quality Management System).
Implementing ISO 37301 involves structured steps, including
top management engagement, responsibility assignment, obligation and risk
analysis, staff training, ongoing monitoring, and continuous improvement. The
standard provides a unified framework for monitoring compliance with various
laws and regulations while promoting ethical practices across all
organizational levels. It links compliance to corporate strategy, fostering
good governance and informed decision-making based on structured risk and
resource assessments. At its core, ISO 37301 emphasizes principles of good
governance, transparency, and sustainability, and is designed to be applicable
to both public and private sector organizations.
Objectives
of ISO 37301
The standard aims to enable organizations to develop an
integrated compliance management system that strengthens credibility and
sustainability. Its key objectives include:
·
Embedding
a culture of compliance across all levels of the organization.
·
Preventing
legal and regulatory risks and reducing the likelihood of violations.
·
Achieving
good governance by linking compliance with corporate strategy.
·
Enhancing
stakeholder relationships through transparency and traceability.
·
Supporting
risk- and opportunity-based decision-making.
These objectives ultimately create a more effective
compliance framework that delivers a sustainable competitive advantage.
Steps
for Implementing ISO 37301
Establishing a coherent compliance management system based
on ISO 37301 requires structured processes. Key components include:
1. Leadership and Commitment:
Senior management must demonstrate full support by setting policies, fostering
a compliance culture, and embedding it in all company operations.
2. Identifying Legal and Regulatory Obligations: Conducting a comprehensive review of applicable legal and
regulatory requirements, in addition to voluntary commitments (such as codes of
ethics).
3. Managing Compliance Risks:
Identifying, assessing, and prioritizing risks associated with
non-compliance—whether financial, regulatory, or operational—and implementing
proportionate measures.
4. Training and Awareness:
Ensuring employees understand their compliance responsibilities through regular
training programs that enhance awareness and capabilities.
5. Monitoring and Evaluation:
Establishing mechanisms for ongoing monitoring and tracking compliance with
policies and procedures (e.g., internal audits and management reviews).
6. Continuous Improvement:
Regularly reviewing monitoring results, addressing non-compliance issues with
corrective measures, and refining the system to adapt to emerging challenges.
This approach ensures the compliance management system
remains dynamic, adaptable, and effective in addressing evolving regulatory
requirements.
Real-World
Examples of GRC and ISO 37301 Implementation
The Gulf region has recently taken tangible steps toward
adopting global governance and compliance standards. For instance, Abu Dhabi Ports Group announced its
certification under ISO 37301, reflecting its commitment to best practices in
governance and compliance. Similarly, Bahrain’s
BENEFIT Company (a leading provider of electronic financial services)
achieved the country’s first ISO 37301 compliance certification, strengthening
its market position and regulatory credibility.
In Saudi Arabia and Oman, interest in advancing governance
and compliance frameworks is growing, with organizations developing training
plans and engaging consultancy and training firms to deliver specialized GRC programs.
Training
and Human Capital Development in GRC
Specialized training in governance, risk management, and
compliance is essential for building professional competencies and enabling
organizations to successfully implement international standards. “The Only Solution for Training & Consulting”
aims to provide professionals with practical knowledge and tools for
establishing integrated compliance systems. Training programs cover areas such
as compliance risk analysis, policy and procedure design, complaint and
reporting management, preparation for certification audits (including ISO 37301
Lead Auditor), and interactive, applied learning across multiple regions in the
Arab world, Europe, and East Asia.
The integration of governance, risk management, and
compliance drives organizations toward greater consistency and transparency.
Implementing ISO 37301 strengthens the foundations of corporate governance and
organizational alignment, reduces legal risks, and enhances market trust. With
the increasing adoption of global best practices across the Arab region,
investing in specialized human capital development through professional
training is becoming a strategic necessity.
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