Cutting clutter, additional accountability implementation in job descriptions and moving toward a transparent organization are some of the critical corporate recommendations for the 2023 annual compliance wheel for business growth and competitive advantage from the Copenhagen Compliance group for 2023.
There are multiple areas every organization needs to see in 2023, all depending on the corporate discipline, GRC maturity, and IT platform(s). However, every organization must be agile, engaged and dedicated to complying, focusing on sustainability and transparency as a top priority for companies in all trades and sizes.
Besides the focus on privacy, cybersecurity, ethics, and ESG, the board and management must keep a vigilant eye on the board of directors and senior management’s engagement in the areas identified below to ensure that they are integrated into annual board activities and clear communication to senior management on the objectives. In addition, the monthly items will ensure that the company is conducting effective stakeholder engagement and understanding the relevant perspectives, risks, and opportunities in a structured manner to drive executive management’s mindsets for long-term corporate value.
1. Start the year by conducting a workshop to provide insights for developing the maturity of the corporate approach to address the areas discussed in this calendar. The second objective is to measure management’s maturity and to equip the participants with the knowledge and confidence to embrace the concept and how to deploy Data and IT as a performance improvement tool with the corporate ability to pursue leadership ambitions as well as survival. Finally, we can provide the structure, questionnaire, and templates to implement the outcomes.
2. Post-covid repositioning of the corporate position. Get a snapshot of the currently planned technology governance initiatives across the IT departments and identify the need to make technology genuinely secure and ensure it benefits the IT structures and processes. Review the progress made on cybersecurity, environmental, social and governance issues. Get a report on the use of all internet-connected devices and systems, including the safe and responsible governance of the Internet of Things (IoT) and related technologies across the organization to ensure connected devices benefit businesses. Get a report on the planned improvements around cybersecurity best practices and environmental, social and governance (ESG) issues. Review of the leading EU and US IoT cybersecurity regulatory initiatives to strengthen the security of the IoT devices the organization owns and control.
3. Identify the critical societal, economic, and regulatory forces that will impact the organization. Identify the key priorities for 2023 that will allow the organization to forecast the need to know to make informed decisions throughout 2023. Address the challenges and opportunities so that the organization embrace the societal, economic, and regulatory initiatives and priorities across privacy, IT security, corporate ethics and integrity based on the Governance priorities and ESG.
4. Identifying the real drivers of ESG is the G or the S. The board and the management team must ensure that the G is embraced structurally and the S is adopted accountably. Institutional investors and regulatory authorities focus on renewables, social issues and human rights initiatives that force management to be CSR/ESG engaged to ensure full disclosure and transparency with documented due diligence processes and policies. Climate-related exposures will continue to be a hot topic in 2023, and issues regarding biodiversity are critical issues around the fast-evolving international ESG landscape.
5. Added focus on the workforce, skills and resources will be the most significant differentiator to communicating data policies to drive discipline for transparency and accountability in risk intelligence, technology, process, workflow, and metrics to measure compliance confidence across the organization.
6. Corporate Culture, Transparency, and fairness, e.g., public reporting on the gender pay gap and pension contributions. Corporate culture has contributed to more significant. Compliance by design is critical for transforming organizational disclosures as a gold standard for business. Identify the stakeholders to understand how corporate culture and transparency are measured and managed. Board direction in workforce issues previously left to management must change to chart a new path for corporate culture if the previous has failed to deliver.
7. Mandatory reporting and the new regulation are when agility can provide a competitive advantage. Keep pace with a growing list of regulations to avoid getting too far behind. (ADPPA, CPRA, CDPA, EU-US DPF, CTDPA, UCPA, CSRD, SFDR and the EU DSA, DMA, OMG, the list increases…?) compliance will be the critical feature of data governance, including data retirement strategy. Besides the regulatory issues, compliance data should be recycled as a routine to avoid problems related to the need for extra cycles to ensure that compliance data is in order. Multiple surveys reveal that 85+% of compliance data is either redundant, obsolete, obscure, or trivial.
8. Update the Governance and Stewardship Code for investors and stakeholders to link the ESG issues explicitly;
- a. reflects that the organization can demonstrate the benefits of the updated Governance and Stewardship Codes;
- b. ESG priorities that are directly related to the broader strategic goals of the business,
- c. Specific vital metrics can be measured, such as the correlation between stakeholder trust and increased growth.
- d. Training, awareness, and certifications will act as a framework for effective Governance and Stewardship.
9. Compliance certifications have been a competitive differentiator, and new regulatory standards will have a significant impact beyond enhancing GRC to demonstrate corporate values through action. Identify the components that determine the future of corporate trust and the importance that stakeholders place on ethics, integrity, and trust for third parties and the B2C and B2B activities. Plan on how the organisation can embed trust and privacy into the core of its business for increased competitive advantages.
10. Stakeholder and Public expectations of investors and stakeholders. Track and address strategic areas of compliance throughout the year. Both public and private companies are now required by law to report and disclose the public arrangements on the regulatory trend. Increased personal liabilities for directors and the board and management’s collective responsibility must be a serious consideration to be agile throughout 2023.
11. Data Transformation: Data, the volume, and data literacy across the board of directors and senior management are mission-critical to the 2023 operations: These areas include data collection, data security and IT governance that will ensure that data literacy is to lay the path of Artificial Intelligence regulation to comply with the organizational focus on the use of data in automated systems, transparency and accountability mature the data transformation with appropriate and adequate protection.
12. Digitization: Since the business owner’s information is often fragmented and stored in different databases, forms and locations, only customized technology can help to cut through the clutter of big unstructured data and complex corporate structures. In addition, a uniform approach to getting behind the façade of business structures and addressing jurisdictional differences and obstacles is the key. Do not let the investigation end in quicksand, making it challenging to identify the actual owners.
The emergence of the above issues and concerns is a collaborative effort: 2023 will see a rise in the emergence of GRC and IT security programs for cross-functional collaboration effectively.
The Corporate Governance Institute by Copenhagen Compliance can conduct a customized workshop to start the above implementation process during the 1Q of 2023.