Taking the Reins
HR’s opportunity to play a leadership role in governance, risk management and compliance
With businesses expanding globally there has been a substantial rise in accounting and corporate scandals and corruption in transfer pricing, environmental regulations, hiring practices, international tax and much more. As the scope of grievous error – or deliberate misconduct – is growing exponentially, executives and board members are focusing heavily on governance, risk management and compliance (GRC). Unfortunately, there is no single shot solution for regulatory compliance and risk management. Regulatory pressures go through various cycles that are the direct result of the ongoing business environment, as well as today’s complex business environment has made GRC a challenge of epic proportions. The different layers of rules (local, state, national and international), evolving workforce regulation, globalization and global mobility make implementation and compliance a nightmare.
In the middle of all this upheaval the role of chief human resource officer (CHRO) is thrust into prominence. Deloitte Consulting LLP’s publication, Taking the reins, explores the two distinct elements of HR’s involvement in GRC: HR-focused GRC and Business-focused GRC. HR-focused GRC addresses a narrow range of issues centered on traditional HR activities such as workforce management, administration and compliance. While business-focused GRC addresses higher level GRC issues across the enterprise, issues that affect the company’s overall performance, market value and reputation.
Companies are recognizing that every GRC issue is fundamentally the result of one or more people doing something wrong, intentionally or otherwise. As such, the role of CHRO is becoming more and more strategic. They now need to tackle issues throughout the enterprise moving ahead from the realm of HR and workforce administration. With the ever increasing expectations it’s vital that CHROs take up more strategic roles instead of just being a corporate “steward.”
Download the article below to learn about the practical steps CHROs may consider to step up to the challenge.