Enterprise Governance, Risk Management and Compliance (eGRC) Market

Enterprise Governance, Risk Management, and Compliance (EGRC) is a vital aspect of any organization, as it ensures that the company is operating in compliance with laws and regulations, minimizing risk, and promoting effective governance practices. This essay will explore the concept of EGRC and its significance in the business world.

EGRC refers to the integrated framework of governance, risk management, and compliance practices that organizations use to achieve their objectives while maintaining legal and ethical standards. In simpler terms, it is the process by which an organization aligns its strategies, processes, and activities with its goals and objectives, while ensuring compliance with applicable laws and regulations and minimizing risk.

The importance of EGRC lies in its ability to enhance the overall performance of an organization by improving decision-making, mitigating risks, and ensuring regulatory compliance. By implementing effective EGRC practices, organizations can ensure that their operations are aligned with their strategic objectives and that they are operating within legal and ethical boundaries. This not only enhances the organization's reputation but also reduces the risk of legal or financial penalties that could result from non-compliance.

Effective EGRC practices are essential in today's business world, where organizations face an increasing number of risks, both internally and externally. Internal risks may include financial fraud, data breaches, or conflicts of interest, while external risks may include changes in regulations, geopolitical events, or market disruptions. By implementing effective EGRC practices, organizations can identify and mitigate these risks, protecting themselves from potential losses and reputational damage.

In conclusion, EGRC is a critical aspect of any organization's operations, as it helps to ensure regulatory compliance, mitigate risks, and promote effective governance practices. Organizations that implement effective EGRC practices can benefit from enhanced performance, improved decision-making, and reduced risk of legal or financial penalties. As such, it is essential for organizations to prioritize EGRC and invest in the necessary resources to implement effective practices.

The eGRC market is influenced by several driving factors, such as the implementation of more stringent compliance mandates, the integration of AI/ML and blockchain technologies into GRC solutions, and the rise in data and security breaches. However, the different structures of regulatory policies have proven to be a hindrance to the market's growth.

The COVID-19 pandemic has expanded the market scope for digital technologies due to the national lockdowns in each country. As a result, many users have transitioned to remote work, consumers have shifted to online platforms for purchases, and businesses have started utilizing online platforms to sell their products and services. However, the use of BYOD, mobile devices, and other connected devices to access various applications has led to increased vulnerability to cyberattacks. Nearly all businesses, approximately 92%, have some level of digital exposure. For example, the Saudi app 'Dalil' exposed the personal information of over five million users.

Therefore, eGRC solution vendors and providers are expanding their presence in different regions. With the pandemic's end, the adoption of digital technologies increased even further. This rise in digitalization has resulted in the adoption of eGRC services across various industries in the region. These industries have begun using eGRC solutions to meet internal audit requirements, comply with regulations, manage third-party risks, and prevent money laundering. Market players are seeking these solutions to expand their existing customer base and increase their influence across the region.

Enterprise Governance, Risk Management, and Compliance (eGRC) Market Dynamics

Driver: Increase in Strict Compliance Mandates

The demand for eGRC solutions is on the rise due to the increasingly complex regulatory environment and the need for organizations to comply with various regulations. Compliance with regulations such as COBIT, Sarbanes-Oxley Act (SOX), Federal Financial Institutions Examination Council (FFIEC), General Data Protection Regulation (GDPR), and other federal and state mandates is critical for organizations to avoid losses. Failure to comply with these requirements can lead to high business losses in the form of penalties. The introduction of GDPR, which aims to provide greater control over access to personal data of European citizens, has impacted businesses worldwide that deal with European clients. Adhering to regulations and compliance requirements is becoming an arduous task for enterprises, given the added pressure of facing severe penalties for non-compliance. By deploying eGRC solutions, businesses can meet various regulatory requirements and avoid losses. These solutions automate several processes related to compliance requirements, freeing up resources to focus on other tasks such as building strategies. Thus, the need to comply with various regulations is driving the adoption of eGRC solutions globally.

Restraint: Varying Structures of Regulatory Policies

Regulatory policies vary from nation to nation and from industry to industry, with several countries lacking a designated authority to oversee these regulations. The regulation of policies requires consideration of various micro-economic risk factors and business requirements, which differs from region to region. This lack of clear standards and differences in regulatory structures make it challenging for eGRC solution providers to cater to various end-user requirements. In regions with no regulatory structure and standard imposed by governing bodies, organizations focus on executing in-house regulatory guidelines and policies. This factor restrains the growth of the eGRC market.

Opportunity: Expansion through acquisitions and partnerships

The eGRC market has experienced significant growth in recent years due to the increasing adoption of eGRC solutions. To maintain their competitive position and keep up with changing client needs, different vendors in the market are implementing organic and inorganic strategies. Both major corporations and smaller vendors are entering into partnerships and engaging in acquisitions to improve their market position. Many vendors are concentrating on acquisition strategies to bolster their product portfolio and broaden their presence in the eGRC market.

Challenge: Delivering comprehensive eGRC solutions

Organizations are focused on providing services to various industries such as BFSI, healthcare, legal, retail, and e-commerce. These organizations aim to develop solutions that can meet the unique requirements of these industries. However, the main challenge hindering growth is providing an integrated eGRC solution that can fulfill the diverse business needs of these industries. This solution must incorporate risk management, mandates, and compliance for end-users in various industries and assist them in navigating the complexities of changing business requirements. Producing such a solution is a complicated task since each industry has distinct regulatory and compliance requirements that must be followed. However, with technological advancements and an increased business focus on developing innovative solutions, vendors are anticipated to concentrate on creating an integrated solution that can cater to customer requirements in the eGRC market.

During the forecast period, the regulatory and compliance solution type holds the highest market size in the eGRC ecosystem. This segment consists of regulatory management, compliance management, policy management, privacy management, and investigation & case management solutions. The growing demand for regulatory and compliance solutions is attributed to the need for compliance with regulatory and reporting requirements. Non-compliance can result in higher penalties and severe financial losses. Thus, enterprises focus on deploying systems that help manage these requirements and ensure compliance-related tasks are completed. Vendors offering regulatory & compliance solutions include Quantivate, SAI Global, MetricStream, SAP, Thomson Reuters, and SAS.

In terms of business function, the IT segment is projected to grow at the highest CAGR during the forecast period. The IT department faces various challenges related to technology risks and compliance. IT GRC solutions offer a framework for decision-makers to ensure that IT programs align with the organizational strategic objectives. These solutions help organizations standardize and manage policies and controls that can impact organizational risks. The increase in the CAGR rate of the IT segment is attributed to the need to integrate compliance and IT functions to help businesses tackle the impact of the pandemic. Also, the work-from-home approach has increased exposure to technology risks, leading to a focus on IT GRC initiatives by enterprises to create a competitive business environment and mitigate threats such as cyber-attacks and data loss that can lead to significant business losses.

The eGRC market is predicted to experience a larger compound annual growth rate (CAGR) in the healthcare segment. This growth is due to the pressure on the healthcare industry to perform better while reducing overall costs and complying with various regulations to avoid penalties. Compliance with the Health Insurance Portability and Accountability Act (HIPAA) is required for healthcare providers to ensure data privacy and security for protecting medical data. Therefore, vendors like SAI Global, LogicManager, and LogicGate offer eGRC solutions designed to support healthcare providers and meet industry standards like HIPAA, HITECH, ISO, and NIST. The pandemic has resulted in changes to the regulatory environment in the US, and compliance teams must adapt and respond quickly. As a result, eGRC solutions in the healthcare vertical are continuously upgraded, contributing to the increased CAGR in this sector.

North America is anticipated to have the largest market size during the forecast period in the eGRC market. The region is highly advanced in cybersecurity technology adoption worldwide and has a constant need to secure communication infrastructure and sensitive data. Government intervention has increased due to the growing need to comply with various regulations to avoid penalties or fines, leading to the use of eGRC solutions. North America is home to major vendors like IBM, Microsoft, Oracle, SAS Institute, ServiceNow, FIS, and MetricStream, and it has implemented advanced technology such as AI and ML in eGRC solutions. Factors contributing to the growth of the eGRC market in the North American region include changing working scenarios due to COVID-19, BYOD trends, adoption of cloud and IoT, adherence to compliance and regulations, and increasing risks like BEC, phishing, malware, and other advanced threats.

During the forecast period, the software segment is predicted to hold the largest market share. The growth of this segment is attributed to the large number of players in the EGRC market who offer software solutions. Additionally, many companies in the EGRC market have a global presence, leading to wider adoption of software during the forecast period. For example, as of 2021, Oracle has user communities in 97 countries and 5 million registered members of Oracle customer and developer communities. The extensive reach of major companies in the market has contributed to high market growth during the forecast period.

In 2022 and 2030, the BFSI vertical is projected to hold the largest share in the enterprise governance, risk & compliance market. The financial sector has experienced a rise in digitalization and adoption of other technologies in recent years, which is also benefiting the enterprise governance, risk & compliance market. This growth is evident in the BFSI segment. For instance, in November 2022, The Bank of East Asia, Limited selected Wolters Kluwer N.V., a Dutch software solution provider, to offer its regulatory reporting software (OneSumX). Such adoption is taking place in high numbers, resulting in the increased growth of the BFSI segment during the forecast period.

During the forecast period of 2023-2030, Asia Pacific is expected to have the highest growth rate. The growth of the Asia Pacific region can be attributed to the technological advancements that have taken place in countries such as China and Japan. Major countries in the Asia Pacific region are among the leaders in the latest technologies, such as 5G and automation. This trend of keeping up with the latest technology is expected to result in increased adoption of GRC in the Asia Pacific region in the coming years. Additionally, India, a growing economy, is witnessing increased EGRC digitalization and data protection regulation, compliance that businesses must follow. These aspects have driven the growth of GRC adoption in India, eventually resulting in the development of the Asia Pacific region.

The key players in the global Enterprise Governance, Risk Management and Compliance (EGRC) Market

• IBM
• MICROSOFT
• ORACLE
• SAP
• SAS INSTITUTE
• SERVICENOW
• THOMSON REUTERS
• WOLTERS KLUWER
• FIS
• SOFTWARE AG
• METRICSTREAM
• MPHASIS
• SAI GLOBAL
• LEXISNEXIS
• DILIGENT CORPORATION
• ONETRUST
• NAVEX GLOBAL
• RSA SECURITY
• MEGA INTERNATIONAL
• IDEAGEN
• LOGICMANAGER
• RISKONNECT
• ALLGRESS INC
• CAMMS GROUP
• LOGIC GATE
• RECIPROCITY
• SURECLOUD
• PROCESSGENE
• LEXCOMPLY
• STANDARDFUSION
• COMENSURE
• DYNAMIC-GRC
• VCOMPLY

Recent Developments in Enterprise Governance, Risk Management and Compliance (EGRC) Market

The enterprise governance, risk management, and compliance (eGRC) market have witnessed recent developments from key players. Oracle released version 8.6.0 of its Oracle Governance Risk Compliance Intelligence (GRCI) in April 2022. This intelligence reporting application extracts data from Oracle Governance, Risk, and Compliance Controls (GRCC). In March 2022, IBM launched IBM OpenPages with Watson 8.3, which is an integrated GRC platform that provides a task-focused user interface to help organizations maintain risk and compliance initiatives. Additionally, in January 2022, SAP introduced Access Violation Management. It enables real-time risk analysis and provisioning, user access reviews, role management, and emergency access management for on-premises and cloud-based enterprise applications. These recent developments from industry leaders demonstrate their focus on enhancing eGRC solutions and keeping up with the ever-changing needs of businesses.

The Enterprise Governance, Risk Management and Compliance (EGRC) market has witnessed several recent developments, primarily driven by the growing need for organizations to adhere to stringent regulatory requirements and increasing cyber threats.

One significant development in the EGRC market is the integration of advanced technologies like artificial intelligence (AI) and machine learning (ML) in EGRC solutions. These technologies enable organizations to automate several processes involved in adhering to compliance requirements, reducing the risk of errors and freeing up resources to focus on other tasks.

Another development is the increasing adoption of cloud-based EGRC solutions, which offer several benefits such as easy accessibility, scalability, and cost-effectiveness. Cloud-based solutions also enable organizations to implement robust disaster recovery and business continuity plans, ensuring that they can quickly recover from any security incidents.

Furthermore, there has been an increased focus on developing specialized EGRC solutions for specific industries like healthcare, finance, and energy. These solutions are designed to cater to the unique compliance requirements and risk factors that are specific to each industry.

The COVID-19 pandemic has also had a significant impact on the EGRC market, with organizations facing new and evolving cybersecurity threats as a result of the shift to remote work and the increased use of digital technologies. As a result, there has been a growing demand for EGRC solutions that can help organizations manage these new risks and comply with regulatory requirements.

Overall, the recent developments in the EGRC market reflect the increasing importance of effective governance, risk management, and compliance in today's complex business environment. As organizations face more stringent regulatory requirements and growing cyber threats, the adoption of advanced EGRC solutions is expected to continue to grow in the coming years.