Governance, Risk Management and Compliance (GRC) Market Size, Share, Growth, and Industry Analysis, By Type (Cloud-based, On-premise), By Application (Large Enterprises, SMEs), and Regional Insights and Forecast to 2033

GOVERNANCE, RISK MANAGEMENT AND COMPLIANCE (GRC) MARKET OVERVIEW

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The global governance, risk management and compliance (grc) market is poised for significant growth, starting at USD 15.93 billion in 2024, climbing to USD 17.61 billion in 2025, and projected to reach USD 39.14 billion by 2033, with a CAGR of 10.50%.

GRC stands for Governance, Risk Management, and Compliance and promises solutions which allow companies to regulate itself and keep track of frameworks and risks. This sector has expanded over the years because firms across globe have been subjected to an extended legal requirements and need risk management. These processes are managed and coordinated through GRC tools as well as the tool supports functions in policy management, internal auditing, risk assessment, and regulatory reporting among others. Currently, most key players in the GRC market offer complex software along with the ability to consult companies in various fields such as finance, healthcare, IT, and manufacturing industries. Amid digital transformation initiatives across the globe there is increasing spending on GRC as organizations engage it for compliance as well as to set up strong operations and structural management systems.

COVID-19 IMPACT

"Governance, Risk Management and Compliance (GRC) Industry Had a Negative Effect Due to supply chain disruption during COVID-19 Pandemic"

The global COVID-19 pandemic has been unprecedented and staggering, with the market experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden market growth reflected by the rise in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels.

The COVID-19 pandemic negatively impacted the Governance, Risk Management and Compliance (GRC) market share place by disrupting global delivery chains. All these disruptions pointed the need to have strong GRC framework, this is due to regulatory changes, cyber threats and supply chain disruptions. There has been a growing demand to get prompt risk evaluation and also compliance in operation as organizations faced unanticipated volatility in supply chain besides new standards meant to enhance wellbeing, safety and data security. Originally businesses began to utilize GRC solutions in order to address these risks and provide supply chain visibility and consolidating their compliance efforts during a time of fast change. It led to increase of GRC solution in cloud infrastructure and the increased importance of GRC system in enabling business continuity and resilience planning.

LATEST TREND

"Increased Focus on ESG (Environmental, Social, and Governance) Compliance to Drive Market Growth"

Recent traits inside the Governance, Risk Management and Compliance (GRC) industry is the Increased Focus on ESG (Environmental, Social, and Governance) Compliance. Corporations are giving ESG scores even higher importance as the demand for better understanding of the organizational effects on the environment and society increases. GRC systems are becoming integrated with features of ESG risk management and reporting to help organizations meet the legal requirements for sustainability and meet investors’ requirements.

GOVERNANCE, RISK MANAGEMENT AND COMPLIANCE (GRC) MARKET SEGMENTATION

By Type

Based on Type, the global market can be categorized intoCloud-based, On-premise

• Cloud-based: - Web-based GRC solutions are centralised on other computers and can be accessed via the internet only. These platforms provide flexibility – resources required within an organization may be adjusted up or down according to need. Due to its ability to share computing resources, cloud-based GRC is relatively more affordable than traditional system implementations and more appealing to small businesses and startups. Also, cloud solutions come with consistent, regular updates and they are self-service thus the need for software upgrade and maintenance is rarely needed and in this way comes with the latest compliance standards as well as cybersecurity norms.

• On-premise: - Traditional GRC solutions are installed on a firm’s internal servers making companies fully in charge of the software’s environment. This setup is especially used by organizations that have greater demands for the security of their data, for instance; financial institutions and or government organizations due to high level sensitivity of the data. While purchased on-premise GRC solutions entail expensive costs for hardware and annual software maintenance, they provide full control over data protection policies and opportunities for adapting requirements to the organization’s needs.

By Application

Based on application, the global market can be categorized into Large Enterprises, SMEs:

• Large Enterprises: - In greater organizations, GRC enhances operational management of vast regulatory demands, risk control in various operational divisions, and compliance with global standards compliance. Industry risks are complex and come in many flavors but it is only in very large organizations that they interact and overlay in ways that a highly developed GRC design can anticipate, encode, monitor and control to eliminate non-compliance at any geographical level. Large enterprise organizations have a large number of employees, operational in many located areas and may have different functions utilizing GRC system to consolidate risk data, automate reporting processes and documentation, and keep a record of the same.

• SMEs: - For SMEs, the most common and widely used GRC applications are those used to enforce compliancy while at the same time flexible and inexpensive. Small and medium enterprises or SMEs normally grapple with different challenges which for example include working with a squeezed budget, little resources, and limited IT personnel and the SMEs are normally faced with special compliance and risks challenges. Some of the GRC solutions developed to meet the needs of SMEs offer basic features of compliance and risk management to meet organizational basic requirements.

MARKET DYNAMICS

Market dynamics include driving and restraining factors, opportunities and challenges stating the market conditions.

Driving Factors

"Increased Regulatory Requirements and Compliance Standards to Boost the Market"

A factor in the Governance, Risk Management and Compliance (GRC) market growth is the Increased Regulatory Requirements and Compliance Standards. IT departments of governments and industry-specific organizations are increasing the bar of transparency, data security and risk management much especially for industries that are tightly regulated such as; financial, healthcare and energy. This necessity for compliance compliance make organization implement GRC solutions capable of addressing compliance compliance issues to avoid the risks that are linked to non-compliance and data breaches.

"Rising Cybersecurity Threats and Data Privacy Concerns to Expand the Market:"

This increased risk due to previous criticism of GRC expenditures and boosted volumes of cybersecurity threats, especially for organizations operating amidst the new digital transition and growing popularity of remote work, highly fuels the GRC market. Data breaches, identity theft, and financial fraud have become a real problem and introduced cybersecurity threats that made organizations adopt GRC solutions for the enhancement of the risk management program.

Restraining Factor

"High Implementation and Maintenance Costs of Raw Governance, Risk Management and Compliance (GRC) to Potentially Impede Market Growth"

A restraining element within the growth of the Governance, Risk Management and Compliance (GRC) market is the High Implementation and Maintenance Costs. The issues of cost associated with the adoption and sustenance of GRC solutions continue to act as the key growth limitation, especially for SMEs. GRC solutions are usually complex and sophisticated which result in high first costs, license cost and annual maintenance costs. For the firms with a small budget constraints the cost that is incurred in the implementation of GRC solutions in various departments limits the implementation of GRC solutions thereby forcing such firms to opt for cheaper or less complex solutions.

Opportunity

"Integration of Artificial Intelligence and Machine Learning To Create Opportunity for the Product in the Market:"

AI/ML remained as holding prominent opportunities to fuel the growth of the GRC solution markets in following sections. AI and ML can improve GRC processes as real-time risk evaluation, probable compliance violation analysis, and provide more efficient processes for these systems. AI and ML also make use of data to analyze such matters so that if there are signs that an organization is experiencing some violation of compliance or experiencing too much risk it is made aware and it prevents it.

Challenge

"Constantly Evolving Regulatory Landscape of Governance, Risk Management and Compliance (GRC) Could Be a Potential Challenge for Consumers:"

The GRC market continues to grapple with another challenge that is dynamic regulatory environment. New policies and regulations are developed regularly depending with the country and region with little similarity at times. Due to this, the GRC providers are forced to constantly upgrade their services and modify their portfolio, which may not be easy.

GOVERNANCE, RISK MANAGEMENT AND COMPLIANCE (GRC) MARKET REGIONAL INSIGHTS

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• North America

North America is the fastest-growing region in this market. The region has the robust regulation dominance due to the compliance requirement in many region’s industries such as finance, health, and technology. The regional presence of big chunk GRC solution providers like IBM, SAP, Oracle etc help to augment the market in this region. Moreover, AI, ML, and automation solutions have come to be readily implemented at North American businesses and organizations to help orchestrate their risk management and compliance frameworks. Due to such regulatory shift in laws for example Dodd-Frank Act and the Sarbanes Oxley Act, the American business organizations are forced to go for high GRC solutions to minimize risks and compliance.

• Europe

Critically, the GRC market in Europe is equally diverse regarding the regulatory setting of the particular country. A significant factor which has fuelled the market’s growth is the enactment of the General Data Protection Regulation (GDPR), which mandates a business demonstrate they are protecting data and its privacy, hence demand for effective compliance management solutions. Europe is also more conscious of sustainability as well as stringent environmental laws that means GRC platforms for managing Environmental, Social, Governance (ESG) risks. Large firms in those European countries are implementing GRC tools originating from the increasing regulations in their respective financial industries.

• Asia

The APAC GRC market is rapidly expanding due to the accelerated economic growth, industrialization the region has been witnessing and the growing consciousness about the efficient risk management systems. In some of the growing economies such as China, India and Japan there is now pressure to compliance with most of the rules and regulations because of increase in foreign investment and international standards. Furthermore, we find that manufacturing, financial services, information technology and other industries have invested in GRC solutions as a way of addressing compliance challenges as well as managing operational risks. There is also an emergence of new rules and regulation and setting up a new framework such as the Personal Data Protection Act in India are another imperative driving the market for GRC solutions.

KEY INDUSTRY PLAYERS

"Key Industry Players Shaping the Market Through Innovation and Market Expansion"

Key enterprise players are shaping the Governance, Risk Management and Compliance (GRC) marketplace through strategic innovation and marketplace growth. With the increasing complexity of regulations, businesses are turning to advanced technological solutions such as AI, machine learning, and automation to enhance their GRC strategies. These innovations help streamline risk assessment, automate compliance processes, and provide real-time insights, reducing the potential for human error and improving overall efficiency. Market expansion is also driven by the growing adoption of GRC solutions across various industries, including finance, healthcare, manufacturing, and energy, as regulatory pressure intensifies worldwide. The demand for integrated, scalable GRC platforms that offer end-to-end solutions is fueling the market's growth. Moreover, the rise of cloud-based GRC systems is facilitating wider access to these tools, enabling businesses of all sizes to implement robust compliance and risk management frameworks. As a result, the GRC market is evolving into a critical element of organizational strategy, helping companies mitigate risks, maintain compliance, and safeguard their reputations in an increasingly regulated global environment.

List of Top Governance, Risk Management And Compliance (Grc) Companies

• IBM: Armonk, New York, USA.
• RSA Security: Bedford, Massachusetts, USA.
• SAP: Walldorf, Germany.
• Oracle: Austin, Texas, USA (formerly based in Redwood Shores, California).
• Software AG: Darmstadt, Germany.
• LogicManager: Boston, Massachusetts, USA

KEY INDUSTRY DEVELOPMENT

March 2024: Credo AI debuts governance, risk, and compliance solutions for AI to facilitate the safe adoption of AI technologies. This GRC for AI introduces a range of new features and a user-friendly redesign of the Credo AI interface. This platform upgrade caters to AI Governance Custodians by simplifying the tasks required to ensure the safe and ethical use of AI.

REPORT COVERAGE

The study encompasses a comprehensive SWOT analysis and provides insights into future developments within the market. It examines various factors that contribute to the growth of the market, exploring a wide range of market categories and potential applications that may impact its trajectory in the coming years. The analysis takes into account both current trends and historical turning points, providing a holistic understanding of the market's components and identifying potential areas for growth.

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