Today’s digital environment is volatile. Organizations need dynamic, secure risk management capabilities to maintain consistent performance and earn their customers’ trust. To excel in risk management, compliance and internal audit teams must have a solid handle on the controls covering high-risk operational processes — and consistently test those controls to gain confidence from their senior executives.
Unfortunately, controls testing tends to become exponentially more difficult as a firm scales up and its managers are in a near-constant state of controls implementation to keep pace with new regulations and third-party. Compliance professionals face restrictive constraints that keep rigorous control testing out of reach. Many compliance and internal audit teams test only the controls examined in the following external audit.
An ad-hoc approach to controls testing creates room for error, gaps and neglect, leading to costly problems. For instance, Hyperproof’s 2022 IT Compliance Benchmark Report confirms these difficulties: 90 percent of surveyed respondents reported they have faced negative impacts from third-party incidents in 2021.
Organizations need more effective ways to use technology to increase control testing coverage and be more productive in their control performance evaluation efforts. Continuous Controls Monitoring (CCM) goes a long way toward solving these complex challenges.
CCM is the application of technology to enable continuous (or high-frequency) automated monitoring of controls to validate the effectiveness of controls designed to mitigate risk, including combating cyber-attack attempts and ensuring business continuity and regulatory compliance.
Across industries, organizations have deployed CCM to track key control processes surrounding network and data security. CCM works in Financial Services to detect fraud and monitor transactions and Manufacturing to ensure quality and audit process controls.
CCM offers numerous benefits to organizations, including:
- Increased productivity of compliance and internal audit teams. When more controls can be tested in a given timeframe, compliance professionals are more likely to catch issues before they develop into problems. CCM also frees up time for compliance and internal audit professionals to focus on higher-value tasks, such as the manual testing required to evaluate controls.
- Increased confidence that line managers who operate critical business processes proactively manage the associated risks. CCM gives compliance managers a clear view into critical control activities to confirm they have performed as expected, for example:
- A senior engineer reviews new code before deployment into the production environment.
- The company’s single sign-on system administrator removes access for a terminated employee within seven days of termination.
- Any time a “critical” vulnerability is discovered by the company’s vulnerability scanning system, the security team is immediately notified and the patching is done within seven days in accordance with the company’s vulnerability management program policy.
- Reduced remediation costs as control deficiencies are identified and fixed before they escalate.
- Increased visibility into the organization’s risk, security and compliance posture for senior leaders.
- Improved ability to prioritize risk management decisions.
- Improved standing in the eyes of regulators, customers and auditors because the organization has readily available evidence of risk mitigation, protection of valuable assets and an ability to meet its legal obligations.
How to implement CCM
Implementing CCM in some cases can be as simple as turning on specific settings in the source operating system and using built-in reports for monitoring. But to have a comprehensive CCM system in place that monitors a wide range of controls across business domains, an organization must have a single repository that documents and manages its controls and gathers evidence of their effectiveness. This type of system, commonly known as a compliance operations platform, is built to test and monitor controls at scale.
A compliance operations platform has connectors to typical business applications across IT, Development, Security, HR, Sales and Finance – and can automatically pull relevant data about many types of controls into its platform, streamlining controls assessment and validation. Compliance professionals can define tests with pass/fail criteria and frequency and configure automated workflows to manage alarms, communicate, investigate and correct any control weaknesses.
CCM is an essential aspect of any comprehensive Governance, Risk and Compliance program, making overall risk management for enterprises more effective and efficient. With the evolution of GRC software and the availability of highly intuitive platforms, even small organizations can utilize CCM to advance their compliance operations.