GRC Reporting: Paradigm 5
Paradigm change in GRC reporting
- Generate tangible value for the executive and supervisory board
Many organizations still view GRC reporting merely as a necessary legal requirement and a contribution to reducing liability. Reports for executives and supervisory boards, however, offer potential for presenting opportunities in light of risks and, therefore, delivering real value for the company’s sustainable development. This, however, requires a paradigm shift in the way that GRC processes are reported so that the efforts center on providing concrete insights on core issues for the supervisory and executive boards. Paradigm #5 covers the megatrend digitalization.
- Changing the focus of reporting to information instead of mere documents
Reporting to supervisory boards and audit committees primarily centers on documents. Integrated reports and a modern presentation via dashboards, however, offer significant advantages over static PDFs. Not only is the relevant information available anytime, anywhere. Drill-down and drill-through functions also allow granularity and details to be customized to individual needs or preferences.
This transition creates a few challenges for the departments. Nowadays, the reports are typically available in an electronic format within the boardroom. Beyond that, however, the technological possibilities are viewed with skepticism and only used to a limited degree. Altering these views requires a major change that is only possible through a gradual, yet consequent introduction.
In this case, the added value must be self-explanatory at a glance. As soon as a dashboard requires further explanation, it will not be viewed as being clear and intuitive. The overviews that are used, therefore, must be well thought out and flawlessly processed to deliver logical arguments. This ensures that the executive and supervisory boards immediately can grasp correlations without further explanations and incorporate them in their deliberations.
The selected presentation form in reporting can highlight the message. In a worst case, however, it can also convey false conclusions which would lead the decision-maker down the wrong path. Accordingly, the efforts to optimize the presentation of reports should not be underestimated. The objective must be to present a transparent, reliable foundation for making decisions. This is necessary to ensure that a decision-maker can intuitively read it correctly. In order to move ahead on the path to optimized reporting, departments should start with specific examples and then extend these efforts once gaining the commitment of the executive and supervisory boards.
Recommendations for action
In the first step, take an older report from your own collection and observe it from a distance through the eyes of a decision-maker. Would you be better informed to make a decision based on this information? Then pick a section and design it – initially just on paper – in a way that you feel is modern and insightful. Afterwards, take a look at the technologies that are already being used in your company and inform yourself about possible usage scenarios.