Compliance Risk Assessment

The usual sequence begins with a list of obligations, drawn from laws, licence conditions and internal policies, often held in an obligations register. Each is matched to business activities and scored for inherent risk, the exposure before controls, using factors such as volume, complexity, past breaches and regulator interest. The team then rates the controls and arrives at residual risk. Results are placed on a heat map or ranked list, and high scores trigger action plans, extra monitoring or more training. Assessments are repeated at least yearly and whenever something big changes, such as a product launch or new regulation. The process draws on interviews, loss and breach data and results from earlier testing. Unlike an enterprise risk assessment, it looks only at rule-related exposure. The output decides where testing hours, training budget and specialist reviews go in the coming year; a low score means a lighter check, not none.

A payments company rates 80 obligations. Data privacy scores high because it processes large volumes and had two complaints last year, while the rule on annual licence fee payment scores low. The compliance plan puts most of its testing hours and new training into privacy, and fee payment is checked once.