If you didn’t know it already, here’s confirmation. A global research firm predicts that financial services’ spending on governance, risk and compliance (GRC) will enjoy double digit growth over the next few years.

Although the recent crisis brought risk management and compliance to the forefront, banks have been grappling with these issues for decades as their business globalized, diversified into new products and channels, confronted technological innovation, or underwent periods of stress. It’s a fact that a resounding majority of global banks are accountable to 4 or more regulators – many report to as many as 10 authorities – and could face several hundred examinations each year.

The increase in regulatory complexity has come about as a creeping change over the years, which banks have addressed in similar fashion, creating independent incremental solutions to help them comply with each change in regulation. The result? An inefficient and expensive maze of duplicate processes, documents and solutions, all operating within silos to deny banks an integrated holistic view of their compliance activities, made worse as banks added new systems to old.

Consequently, there is very little information sharing between the diverse risk and compliance management applications housed within a bank. The same data is repeatedly entered into many systems, in different formats, which is not only inefficient but leaves the door wide open to error. Imagine what a multinational bank that has to comply with a plethora of regulatory and reporting needs in each country of operation must go through! Imagine also the consequences of failure.

Fortunately, integrated compliance and risk management systems are coming to the rescue. Taking a structured approach, they enable banks to centrally manage risk and compliance activity across the length and breadth of the organization from a single platform. These systems capture risk data in real time from all sources of origination to provide consistent ‘single version of the truth’ feed to its powerful analytics engine, which churns out insight based on which risk managers can take fully informed decisions. The new result?

• Better governance and compliance
• Optimized risk decisions
• Reduced time and cost of compliance as well as legal liability
• Improved reputation and stakeholder confidence

Let’s hope that this is where most of that GRC spending is headed.