Building Trust and Transparency with SAP GRC: A Roadmap to Successful Governance
Governance, Risk, and Compliance (GRC) is more than just a set of policies and controls. It’s a strategic approach that helps organizations navigate the complex and ever-changing landscape of regulations and risks. With GRC, organizations can proactively identify and manage risks, ensure compliance with regulations and standards, and drive business performance. It’s a holistic approach that aligns people, processes, and technology to enable organizations to achieve their objectives and thrive in today’s competitive environment. Whether you’re looking to safeguard your organization’s reputation, protect your customers’ data, or improve operational efficiencies, GRC is the foundation for success. So why not embrace GRC and turn risk into opportunity?
Meet Alex, a new IT manager at a global manufacturing company that uses SAP as its core business system. Alex’s boss has tasked him with ensuring the company’s compliance with various regulations and standards, such as GDPR and SOX. To start, Alex begins by defining the compliance requirements for the company. He researches the relevant regulations and standards that apply to the company’s industry and operations. After consulting with various stakeholders, Alex establishes policies, procedures, and controls to meet these requirements. For example, he creates data access policies and data retention policies to comply with GDPR.
Next, Alex conducts a risk assessment to identify potential vulnerabilities, threats, and impacts on the company’s business processes within the SAP system. He uses various methodologies, such as qualitative risk analysis, to identify potential vulnerabilities and prioritize risks based on their impact and likelihood. He also works with other departments, such as finance and HR, to identify the segregation of duties and risks that may exist within the SAP system.
With the risks identified, Alex implements controls to mitigate them. He leverages SAP’s access control and segregation of duties functionalities to implement controls that restrict users’ access to sensitive data and transactions within the SAP system. For example, he creates user roles that limit access to certain functions, such as financial reporting, to specific users.
To ensure that controls are effectively implemented, Alex sets up a monitoring system to continuously monitor and report on compliance-related activities within the SAP system. He uses SAP GRC tools to create dashboards and reports monitoring compliance-related activities, such as access and policy violations. Alex also conducts periodic reviews of audit logs to detect potential issues.
Finally, Alex conducts regular audits to assess the effectiveness of the company’s GRC compliance program. He uses established audit criteria and methodologies to identify gaps and areas for improvement. Alex works with other departments to address the issues identified and continuously improve the company’s GRC compliance program.
Thanks to Alex’s diligent efforts, the company can navigate the complex and ever-changing landscape of regulations and risks. The company can comply with regulations and standards, protect sensitive data, and drive business performance.
Let us further understand the business use through implementation in the industry leaders. We have two characters discussing the benefits of GRC and how companies are using it.
Mr. Jack: Can you provide some real case studies of companies that have implemented GRC solutions?
Ms. Kate: Sure, let me give you a few examples. Coca-Cola is a multinational beverage company that has implemented a comprehensive GRC program using SAP’s GRC solutions. The program covers risk management, compliance, and internal audit functions. They have automated their internal control processes using SAP GRC’s Process Control module, which has enabled them to reduce the cost and time associated with manual processes.
Mr. Jack: That’s interesting. Can you give me an example of how they use SAP GRC’s Access Control module?
Ms. Kate: Sure, Coca-Cola has implemented SAP GRC’s Access Control module to manage access to its SAP systems and prevent segregation of duties conflicts. This means they can restrict users’ access to sensitive data or transactions within the SAP system and ensure that no single user can execute all stages of a business process.
Mr. Jack: What about other companies? Can you give me some more examples?
Ms. Kate: Sure, Intel is a global technology company that has implemented a GRC program to manage its regulatory compliance, risk management, and internal controls. They use SAP GRC’s Process Control module to automate their internal control processes and monitor compliance with various regulations and standards. Siemens is another global technology company that has implemented a GRC program to manage its regulatory compliance and risk management. They have implemented SAP GRC’s Access Control and Process Control modules to manage user access to its SAP systems and monitor compliance with various regulations and standards.
Mr. Jack: It seems like GRC solutions are becoming increasingly important for companies. Can you tell me why?
Ms. Kate: GRC is becoming increasingly important as companies face greater regulatory scrutiny and increasing complexity in their business operations. By implementing GRC solutions, companies can proactively manage risks, ensure compliance, and drive business performance.
Let me narrate a hypothetical story about a multinational organization named XYZ Corp. XYZ Corp operated in several countries and industries, handling sensitive data and financial transactions of its clients. They knew that they needed to comply with various regulations and standards to ensure the protection of their client’s information and maintain their trust.
One day, the CEO of XYZ Corp, John, sat down with his team to discuss how they could manage their compliance requirements. They identified six key regulations and standards that applied to their business: GDPR, SOX, HIPAA, PCI DSS, FCPA, and ISO 27001. John decided that the best way to manage their compliance requirements would be to implement SAP GRC. With SAP GRC, John’s team could define the policies and controls necessary to meet their compliance requirements for each of these regulations and standards. Firstly, they started with GDPR. They knew that GDPR required organizations to protect the personal data of EU citizens. They used SAP GRC to assess the risks associated with their data processing activities and implement controls to protect their clients’ data.
Next, they looked at SOX compliance. They knew that SOX required them to have strong internal controls and processes to ensure the accuracy of their financial reporting. They used SAP GRC to implement access controls and segregation of duties to prevent conflicts of interest. Moving on, they looked at HIPAA compliance. They knew that HIPAA required them to protect the confidentiality, integrity, and availability of their client’s health information. They used SAP GRC to implement controls to ensure that only authorized personnel could access this sensitive information.
They also needed to comply with PCI DSS regulations, which required them to protect their clients’ payment card data. They used SAP GRC to implement controls to protect payment card data from theft and misuse. For FCPA compliance, they knew that they needed to prevent bribery and corruption. They used SAP GRC to implement controls to prevent conflicts of interest and track payments to detect any suspicious activity.
Finally, for ISO 27001 compliance, they knew that they needed to have a comprehensive information security management system in place. They used SAP GRC to assess their information security risks and implement controls to protect their information assets. Thanks to SAP GRC, John’s team managed their compliance requirements and protected their clients’ information across all these regulations and standards. John was confident that his organization was meeting its compliance obligations and maintaining the trust of its clients.
GRC plays a crucial role in helping organizations comply with regulations and standards, manage risks, and improve overall governance. Implementing SAP GRC can provide numerous benefits, such as improved visibility, streamlined processes, reduced costs, and increased compliance. However, managing compliance with multiple regulations and standards, such as GDPR, SOX, HIPAA, PCI DSS, FCPA, and ISO 27001, can be complex and challenging. It requires a comprehensive and ongoing approach to monitoring and assessing compliance-related activities within the SAP system, including risk assessments, controls implementation, compliance monitoring, and audit. Organizations must stay informed and updated on changes in regulations and standards and adjust their GRC programs accordingly. By doing so, they can ensure that they meet their compliance obligations and reduce the risk of legal and reputational damage.
Ø SAP’s official website and documentation on GRC: https://www.sap.com/products/governance-risk-compliance.html
Ø European Union GDPR website: https://ec.europa.eu/info/law/law-topic/data-protection_en
Ø U.S. Securities and Exchange Commission (SEC) website for SOX: COMPS-1883.pdf (govinfo.gov)
Ø U.S. Department of Health & Human Services (HHS) website for HIPAA: https://www.hhs.gov/hipaa/index.html
Ø Payment Card Industry Security Standards Council (PCI SSC) for PCI DSS: https://www.pcisecuritystandards.org/
International Organization for Standardization (ISO) for ISO 27001: ISO – International Organization for Standardization