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February 10, 2017
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Trusted data is driving Information Governance investments
By John Desborough
Continued calls for deregulation may sound like death knell for information governance, but IG investments may prove to be more vital than ever to businesses in 2017 and beyond.
The biggest driver for Information Governance (IG) these days is not regulatory compliance. Trusted data in all forms of business transactions - including mergers and acquisitions - has become the driving force as more and more companies adopt digital capabilities.
Adopting digital capabilities within corporations has driven important shifts in how corporate compliance programs have been justified. First, corporate business records in a digital format are more accessible to enforcement investigations. Violations can be detected digitally, through real-time supervision of digital corporate data, such as SEC supervision of market trading in the financial sector. Second, digital records can be more easily shared among governments, enabling cross-border investigations and enforcements in highly regulated (and often complex) industries and markets. Both of these shifts have made it easier for information governance to justify the spending on their work, as well as related improvements to corporate compliance programs.
With so many stories emerging of falsified business information and records, more rigorous due diligence of corporate business records and information has become a starting point for increased information governance. No commercial transaction of any meaningful value will move forward without increasingly rigorous validation of the integrity of the data/records involved. Mere promises that a company was in compliance with laws, and properly disclosed any violations, are just not enough.
Here is the new business case for information government investment: companies that spend less on information governance are discovering that being cheap about IG investments impairs their agility and wealth creation during commercial transactions. Companies that invest more in information governance have realized that due diligence is less expensive in direct costs, deals are valued more for their key qualities rather than discounts for poor IG being taken into account, and the information that fuels the negotiations and the structure of the final deal are more likely to be trusted.
Trusted information is the essence of a business deal - whether a purchase from a supplier or a merger/acquisition. That is the essential deliverable from effective IG investments: delivering trust in the digital records that will be evaluated, vetted and ultimately influential in the pricing and structure of the deals themselves.
Trusted digital information is the most substantive asset via data licensing, big data analytics, etc. Companies will succeed or fail based on how well trust is established in their business data. Looking forward, this becomes the driver that matters. After all, when did effective compliance ever create new wealth? What creates wealth is trusted information.
Those companies that understand the value of engineered, well-designed information governance are the ones that will dominate their markets in the years ahead. Those who continue to undercut IG investments and funding in the expectation that lower compliance demands will justify those cuts will find themselves falling behind.
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John Desborough is a Director, Consulting and Technology Solutions at MNP. He is an accomplished business solutions program manager and business transformation architect with 30+ years in the information and technology consulting domain. John has extensive background in information management and governance with both public and private sector clients on a global scale. Drop John a line to discuss this topic in more detail: [email protected]