Modern automobiles use an array of sensors to provide accurate information about the vehicle’s speed, fuel level, and key components. The data allows drivers to avoid accidents, adapt to road conditions, and stay safe.
GRC metrics protect organizations in the same way. The ability to detect risks, take appropriate action, and monitor the effectiveness of controls is vital in today’s quickly changing world.
How Tracking GRC Metrics Helps Your Organization
GRC stands for governance, risk, and compliance. The GRC framework strengthens enterprise programs for regulatory compliance and risk management by centralizing efforts. Metrics play a vital role in every part of GRC:
- Identifying and prioritizing risks
- Measuring risk exposure for different areas of the company
- Calculating the cost of compliance violations
- Evaluating the effectiveness of current controls
- Tracking compliance levels and technology adoption rates
- Designing policies and processes that improve program efficiency
GRC analytics helps with gap assessments, incident response plans, compliance audits, and even vendor evaluations.
Essential GRC Key Performance Indicators
GRC KPIs give you a bird’s-eye view of your framework. They connect all three pillars of GRC: policy decisions, risk management, and compliance efforts.
KPIs measure how effective your program is. They tell you which things you’re doing right, what areas need improvement, and how to improve results while minimizing costs.
1. Policy Adherence Rate
Governance is only effective when executives and employees follow the relevant policies. Policy adherence rate looks at the percentage of departments or divisions that correctly follow regulatory requirements.
Healthcare organizations need to track HIPAA compliance rates. Companies with customers in the EU focus on GDPR compliance. Financial enterprises must meet a variety of government regulations for reporting and cybersecurity.
2. Compliance Audit Success Rate
Compliance with regulatory frameworks isn’t a one-time thing. Measuring the success of ongoing compliance audits helps enterprises follow cybersecurity and risk management best practices.
This KPI also provides a way to track progress. Meeting strict frameworks like GDPR or ISO 27001 doesn’t happen overnight. With analytics, you can determine which areas to prioritize first.
3. Percentage of Compliance Issues Addressed Promptly
How quickly you address issues found in audits says a lot about your risk management and compliance programs. A high ratio of corrected problems means your team is good at finding and implementing solutions. Low ratios can point to too much red tape, spending too long talking about issues instead of correcting them.
4. Training Completion Rate
At the individual level, training is essential for risk awareness, regulatory compliance, and policy adherence. You can’t expect employees to follow rules that they don’t understand.
This KPI is closely related to:
- Training effectiveness rate
- Improvement in compliance adherence
- Time to target competency
- Rate of risk reduction
High training completion rates often mean that your team is taking risk and compliance seriously. This is especially vital for decision-makers, risk committees, and other high-risk GRC roles.
5. Risk Identification Rate
Enterprise risk programs should track several performance metrics related to assessments:
- Percentage of risks successfully identified vs. not identified
- Accuracy of risk classification and scoring
- Frequency of completed risk assessments
- Risk assessment targets met by department/location
The goal is to catch as many risks as possible (especially critical or emergent risks) without wasting time on false positives.
6. Risk Mitigation Effectiveness
Risk management is challenging because theoretical solutions don’t always have the intended effect in real-world scenarios. Measuring the effectiveness of mitigation efforts (e.g., lower costs, fewer attacks, better detection rates) helps you invest resources wisely.
7. Incident Response Time
In critical scenarios like data breaches, ransomware attacks, and natural disasters, every hour makes a difference. Measuring how long it takes your IT staff to respond to a DDoS attack or platform downtime is a good indicator of how they would respond in a bigger emergency.
8. Third-Party Compliance Rate
Most regulatory frameworks hold your business partially or fully responsible for compliance violations by third-party vendors. Many enterprises also want to track vendor compliance to minimize the risk of supply-chain cyberattacks.
Thanks to modern compliance tracking software, you don’t have to wait for vendors to submit quarterly audit reports. In many cases, you can track compliance results and other KPIs in near real-time.
Important GRC Metrics for Risk Management
Key risk indicators are GRC metrics used as early warning signs. KRIs help you catch worrying trends or rising dangers before they turn into full-blown threats.
The KRIs you should track depend on the nature of the risks your organization faces (e.g., cyber risks, regulatory compliance risks, and financial risks). Here are a few examples:
- Employee absenteeism or worker dissatisfaction rates
- System availability/uptime percentage
- Total failed logins/password changes/lost credentials
- Average framework compliance failures
- Cybersecurity nonconformities not resolved on time
- Number of corrective or disciplinary actions administered
When selecting KRIs, you should start by setting “alarm” thresholds for threats. Then, determine which metrics you need to measure related risks.
For example, not applying security patches promptly can significantly increase the risk of data breaches. Related KRIs could include the average time to patch or the percentage of updates applied within an X time frame. Similar metrics can warn of problems with password hygiene, data backups, system maintenance, or vendor security.
Key Control Indicators for GRC Frameworks
KRIs help you detect risks, and KPIs help you measure overall framework results. KCIs reveal the effectiveness of your controls, letting you compare risk and compliance targets against your company’s current practices.
Control indicators are tied to GRC implementation. You can configure KCIs around broad policies or specific processes:
- Evaluating a new compliance strategy
- Finding the ROI of third-party tools for risk management
- Discovering the right balance of controls to meet regulatory guidelines cost-effectively
- Identifying policies or procedures that aren’t working and why
- Measuring employee compliance (following device policies, password guidelines, email attachment rules, etc.)
- Assessing the role performance of responsible parties (Data Protection Officer, etc.)
Some examples of GRC control indicators include incident recurrence rate, audit non-compliance findings, and acceptance rate of remediation actions.
Streamline GRC Metrics: Track, Report, Audit, and Comply
Compyl is a powerful data analytics and automation platform designed with risk and compliance in mind. It can help you track GRC metrics and leverage insights for strategic decisions. Choose a GRC solution with advanced tools and customizable compliance frameworks. Request a demo today.
