Governance, Risk, and Compliance Trends Guide for 2024

April 3, 2024


ViClarity’s annual Governance, Risk & Compliance (GRC) Trends report is here to help organisations and GRC leaders to remain focused on the key trends that are impacting many industries as we progress further into 2024.


Our team of GRC technology experts have explored the world of GRC and spoken with some of the main stakeholders in the industry, to uncover some of the key topics that are front and center on their minds. 

In this blog, we explore four of these key topics, starting with an increased focus on individual accountability from the regulators followed by delving into the use of AI in GRC. The second part of the report discusses how firms are trying to manage cross-border obligations before finishing with the quest for GRC teams to have one central location for all risk, compliance and reporting data.


1 - Individual Accountability 

A key trend across many verticals in the Financial Services sector is that regulators are turning increasingly to formal accountability regimes for individual board members and senior managers. Many international jurisdictions have already implemented accountability regimes including the Australian Prudential Regulatory Authority (APRA) and the United Kingdom’s Prudential Regulatory Authority (PRA).

Both authorities have reported a noted improvement in regulated firms' cultures and behaviours. The European Commission is now exploring the benefits (and downfalls) of an ‘Individual Accountability’ regime, under the Capital Requirements Directive (CRD) while the Central Bank Of Ireland (CBI) has introduced the new Individual Accountability Framework (IAF) which was signed into law on 9 March 2023 and was partially commenced on 19th April 2023.

Many financial services firms are now turning to automated software solutions to help with the increased burden associated with tracking compliance to individual accountability regimes. As we get deeper into 2024 it will be interesting to keep an eye on how these new regimes drive a cultural change within financial services institutions.

Positive changes in behaviours and a cultural shift have been noted by the FCA and PRA since the introduction of the Senior Managers and Certification Regime (SMCR). We will have to wait and see on whether the same changes will be found in Ireland as IAF is rolled out.


2 - The use of AI in GRC

Generative Artificial Intelligence (AI) has the capacity to generate human-like text, making it a powerful tool for many industries, including those within the regulatory and compliance space. There has been a significant development of AI within the RegTech industry. The integration of AI can bring both opportunities and challenges to an organisation.

To name a few benefits, AI can help firms automate regulatory compliance tasks, contribute to more advanced risk assessment models, enhance data processing and simulate regulatory scenarios for training purposes. However, there are many challenges that firms must consider before implementing AI within a company.

RegTech firms need to ensure that the technology is used responsibly and ethically. They must also consider concerns related to data security and privacy when deploying AI for regulatory purposes. They also need to make sure that their AI system is capable of adapting to regulatory changes, to stay compliant.

Ogie Sheehy, founder and global CIO of ViClarity, recently commented on an article in Fintech Global on how ”companies are looking to see how AI can help them be more innovative, and with the use of algorithms it can help with manual tasks and predict outcomes for large volumes of data processing.” While there are areas of concern about the use of AI in certain industries, the trend is now that businesses are more open to exploring this than ever before.


3 - Cross Border Obligations

For the second year running, managing regulatory obligations across multiple jurisdictions makes the trends list. In an ever-changing regulatory landscape, organisations are finding it increasingly difficult to keep up to date and track the vast number of regulatory documents that must be submitted to regulators across multiple jurisdictions. Global compliance teams must devote more resources to monitoring and coordinating business actions in response to increasing regulatory demands.

Regulatory change will continue to be a huge challenge for GRC teams in 2024 as changes to regulations are occurring at an unprecedented rate and scale around the world, and keeping up with such a large volume of complicated requirements can be extremely difficult. Many organisations are turning to alternative ways to manage regulatory change, with Artificial Intelligence (AI) tools and GRC tools like ViClarity leading the way.


4 - The Quest for One Source of Truth

As the stakes for non-compliance get higher and regulators scrutinise financial firms more closely, organisations are seeking ways to provide a more comprehensive and centralised approach to data integrity, compliance and risk management. This includes creating 'one source' of data, which is a single, authoritative source of truth that can be used for risk analysis, proof of adherence to policy, reporting, analysis, and compliance.

Currently, organisations have data silos, which are collections of information that are not easily accessible to the organisation because they are recorded or stored differently. This makes it difficult for organisations to get a complete picture of their data and to comply with regulations. Historically, this would have required a significant investment in time and resources. Now, modern solutions simplify this process, offering a more efficient path.

In the long run, having a single source of data will help organisations reduce costs, improve compliance and make better decisions. For those who continue to turn a blind eye to this issue will face financial penalties, operational risks, and irreparable reputational damage.

In the broader perspective, it can be affirmed that the year 2024 will persist in highlighting the imperative to maintain an equilibrium between technology and human involvement to achieve tangible compliance goals. Financial institutions, in their preparations, should carefully assess their stance along the spectrum of remote work, contemplating the synergistic impact of AI, automation, transparency, and effective leadership. This strategic consideration is vital to guarantee adherence to legal standards in the upcoming year.


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