The Digital Operational Resilience Act (DORA) is now in force, helping to transform how financial institutions manage digital risks. If your organisation is still adapting to the new requirements, here are some quick-fire facts to help you understand DORA at a glance and what it means for your compliance strategy moving forward.
Did You Know?
- DORA covers a multitude of financial entities
The DORA regulation applies to banks, insurance companies, investment firms, payment institutions, credit rating agencies, and even crypto-asset service providers. It also includes third-party ICT providers that support these organisations. Read more about why DORA matters for financial institutions.
- It’s not just about cybersecurity
While cybersecurity is a big part of DORA, the regulation goes further by addressing operational resilience holistically, ensuring financial institutions can withstand (and recover from) disruptions.
- DORA is broken down into 9 chapters, covering topics such as:
- IT Risk Management
- ICT & Operational Incident Reporting
- Operational Resilience Testing
- Third-Party Risk Management
A detailed view of each chapter can be viewed here.
- Failing to comply could prove costly
Non-compliance with DORA will have the potential to lead to significant penalties, including fines up to 2% of global turnover, not to mention the possibility of reputational damage, and even legal action.
- Legacy systems are a risk
For organisations that are still managing outdated systems, these not only pose security risks but make it harder to meet DORA’s requirements. For example, implementing robust tools like Wordwatch will centralise recordings from legacy tech into one place, while also simplifying your communications compliance efforts.
- Third-party risks are under the spotlight
A large requirement for DORA is that financial institutions must ensure that third-party ICT providers meet resilience standards. This includes thorough risk assessments and contractual safeguards – undertake your due diligence!
- Key considerations
If you haven’t already, prioritise the assessment of your IT risks. This includes reviewing incident reporting procedures, conducting operational resilience tests, and the evaluation of your third-party providers.
- Automation will help you
Automating processes like data retention and deletion helps organisations meet regulatory requirements and avoid the risk of over-retention.
- DORA is about transparency and trust
DORA places greater emphasis on incident reporting and accountability, with the aim of delivering greater transparency within the financial ecosystem. This will ultimately build enhanced trust with clients, partners, and regulators.
- Compliance is no longer optional
With DORA now in force, financial institutions must demonstrate full compliance with its requirements. Regulators will begin monitoring adherence, and firms should ensure they have the necessary policies, controls, and reporting structures in place to meet ongoing obligations.
If your organisation is still working towards full compliance, now is the time to act.
By addressing risks proactively, and adopting solutions like Wordwatch, your organisation can not only achieve compliance but also enhance efficiency and trust in your digital systems.