Enterprise Governance, Risk & Compliance Market Size, Share & Trends Report

Enterprise Governance, Risk & Compliance Market Size, Share & Trends Analysis Report By Component, By Software, By Services, By Enterprise Type, By Vertical, And Segment Forecasts, 2021 - 2028

  • Published Date: Apr, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-1-68038-670-7
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 165

Report Overview

The global enterprise governance, risk & compliance market size was valued at USD 35.1 billion in 2020 and is expected to witness a compound annual growth rate (CAGR) of 13.7% from 2021 to 2028. The increasingly complex regulatory, compliance, and risk management environment in businesses has paved the way for GRC solutions. Enterprise governance, risk & compliance (EGRC) enables risk and compliance management teams to analyze and share data for a 360-degree view of the organization’s risk landscape, in turn enabling executives and boards to formulate informed business strategies. The wide implementation of EGRC software applications across enterprises to prevent monetary and reputational risks due to non-compliance is providing an impetus for market growth.

U.S. EGRC market size, by component, 2018 - 2028 (USD Billion)

Rapid globalization and commercialization have encouraged governments to form new policies for fair trade practice. EGRC plays a key role in addressing the complexity of complying with stringent regulatory policies. Furthermore, any changes in the economy of countries directly result in the implementation of new policies or revisions to the existing ones. As such, it becomes necessary for enterprises to stay abreast with these changes and update their existing EGRC solutions to avoid non-compliance. Factors, such as changing business scenarios due to the Covid-19 pandemic, security needs with rising Internet of Things (IoT) & Artificial Intelligence (AI) technology, and external reporting obligations, are expected to create a need for unprecedented requirements for governance, risk, and compliance management. The increasing volumes of digital data, the subsequent need for continuous monitoring and analysis to ensure data security and privacy protection, and regulations being laid down by different regulatory agencies are further driving the demand for EGRC.

The digitalization of banking operations has enabled businesses to simplify their operations. However, this has also increased the possibilities of cyberattacks and fraud. Financial institutions and banks are rapidly investing in EGRC solutions to mitigate risks that arise from compliance failures and fraudulent transactions. In addition, trends, such as mobile payments, e-commerce, cloud computing, big data & analytics, IoT, machine learning & AI, and social media, involve sharing of personal information, making users and businesses more susceptible to hacks. Money laundering activities also pose a high threat to organizations as they may face operational, reputational, and compliance risks.

The advent of IoT and digitization of business processes have initiated the rapid growth of various industries by contributing to a range of business functions from manufacturing to marketing. An EGRC solution is substantial for overcoming the challenges of a hyper-connected business model. Moreover, the introduction of big data is expected to largely contribute to the market as it assists in the analysis of legislations, form processes, and regulations to support EGRC professionals and help enterprises in making informed business decisions.

The changing landscape of businesses and government policies across the BFSI, construction & engineering, energy & utilities, manufacturing, retail, and other industries are also responsible for driving the market. Moreover, the trade war between China and the U.S., introduction of GDPR in European countries, and banking slowdown due to Covid-19 have led to leeway or changes in regulations, necessitating the assessment of external and internal processes and consequences. For instance, the Monetary Authority of Singapore (MAS) provided more flexibility in regulatory requirements for Financial Institutions (FIs) to boost their business during the pandemic. In addition, the General Data Protection Regulation (GDPR) for consumer privacy in Europe has created challenges in compliance as the entire GDPR is highly complex and process-driven. GDPR is applicable for different multinational entities that carry out their businesses over the web and use personal data (contacts) for marketing and other activity.

While EGRC solutions offer a medium for keeping a check on regulations, potential risks, and compliances, they do not eliminate the need for security solutions or other management applications. The Covid-19 pandemic is expected to accelerate the need for a digital workforce, which can subsequently lead to the risk of mishandling business information. The EGRC integration is highly recommended for safeguarding data and Intellectual Property (IP) and maintaining compliance in remote work environments.

Enterprises are now using the Covid-19 impact assessment to increase visibility and assess possible risks in the supply chain and distribution network. Post identification of risks, the EGRC system can help to track the progress of the corrective measures taken by organizations. According to a survey by Open Compliance and Ethics Group (OCEG), enterprises with integrated GRC solutions were more efficient in handling changing regulations and arising risks. Therefore, the pandemic has encouraged enterprises to implement and upgrade their GRC solution to avoid losses during the crisis.

Component Insights

The software segment accounted for the largest revenue share of over 63% in 2020 and is anticipated to continue its dominance over the forecast period. The decreasing cost of ownership of software with integrated solutions, which are widely used for tackling myriad regulations, such as compliance to supply chain, quality control, and OSHA, is anticipated to be a key factor driving the segment growth. Moreover, the increasing need for assessment of third-party and supplier risks and audits is likely to propel the market growth over the forecast period.

The emergence of IoT and other digital frameworks has led to significant upgrades in business processes backed by notable innovations in GRC processes. Internal audit professionals and Chief Audit Executives (CAE) are increasingly leveraging analytics in their audit methods and continuous monitoring and auditing activities. The analytics technology is used for managing an internal audit, which helps identify and safeguard risks & compliance using EGRC risk assessment tools within an enterprise. The low cost of internet connectivity and increasing use of Wi-Fi by organizations are reducing the costs of technology. This is expected to fuel the adoption of governance, risk, and compliance management solutions over the coming years.

Software Insights

Risk management has emerged as the largest software segment accounting for over 25% of the overall revenue share in 2020. Organizations need an active form of risk management to fulfill various conformities. Risk management software helps avert breaches against these requirements and subsequent penalties. Audit management was the second-largest software segment in 2020.

Audit management solutions facilitate organizations’ compliance and auditing responsibilities by providing a centralized platform for accessing information about earlier assessments and managing dues or ongoing auditing. It also helps support company-wide conformity initiatives to reinforce better work practices and greater accountability within individual business units.

Services Insights

Consulting services accounted for the maximum revenue share of more than 30.0% market share in 2020. The global demand for GRC has seen a paradigm shift owing to the emergence of IoT and other digital frameworks within the GRC process. Enterprise governance and compliance management are quickly evolving in response to advancements and changes in technology, hiring, personnel requirements, business practices, and consumer demands and concerns. Big data is expected to become a larger part of GRC, assisting in adhering to regulations, legislations, form processes, and supporting professionals in making threat-informed choices on digital businesses.

Major companies, such as SAP SE; Thomson Reuters; BWise (acquired by SAI Global); MetricStream Inc.; and Wolters Kluwer, facilitate expertise solutions with their consultancy portfolio, which help businesses in assessing trends and current practices as well as achieving value-added results through their operations. Companies also facilitate market intelligence solutions in incident management, ethics management, policy management, and industry benchmarking to provide a holistic view of expenses for future expense management.

Enterprise Type Insights

The large enterprise segment led the global market with a revenue share of over 69%. Given the changing regulatory scenarios, large organizations are increasingly focused on building transparency to mitigate threats associated with the bottom line of the balance sheet. This, as a result, has led to the increasing adoption of GRC solutions and services in large organizations. EGRC vendors are focusing on addressing IT, financial, and other challenges faced by large businesses to increase their client base.

The small and medium enterprise (SME) segment is anticipated to exhibit a CAGR of 14.6% over the forecast period. Regardless of the size of the balance sheet in the current scenario, it is mandatory for companies operating in the BFSI, manufacturing, telecom, and retail sectors to adhere to strict regulations and manage risks associated with the industry. Thus, increasing government regulations across several verticals to protect consumers are anticipated to boost spending on GRC solutions and services in SMEs.

Vertical Insights

BFSI emerged as the largest segment and accounted for over 20%  of the overall revenue share in 2020. EGRC helps in effective risk management by identifying potential threats to customers and third parties covering every line of a business and its operations in the BFSI sector. However, banks and financial institutions are now making use of analytics to detect any entity-level linkages as well as to monitor suspicious activities of different linked accounts used for laundering activities. Hence, large capital is being allotted for the implementation of advanced technology-based EGRC solutions.

The BFSI vertical has witnessed the implementation of several technology-based solutions, such as AI, machine learning, IoT, blockchain, Robotic Process Automation (RPA), and Augmented Reality (AR). BFSI is also one of the early adopters of FDP solutions. Although technologies like blockchain are secure, others may create significant security challenges for companies operating in this vertical. Fraudsters and hackers are adopting newer and advanced technology-based solutions to hack unauthorized networks and systems. This is encouraging companies in the financial sector to implement security solutions and use EGRC to assess underlying threats of unauthorized access.

Global EGRC market share, by vertical, 2020 (%)

Telecom and IT is expected to emerge as the fastest-growing segment exceeding a CAGR of 15% from 2021 to 2028. Telecom companies are highly regulated owing to the nature of data collected, stored, and processed in the industry. Moreover, several rules have been laid down to monitor the use of bandwidth by telecom operators. For instance, the Internet Service Providers (ISPs), radio and TV broadcasters, cable providers, interconnected VOIP providers, interstate telecommunication provider, and satellite companies are primarily regulated by FCC in the U.S. Furthermore, net neutrality was introduced to reclassify the broadband Internet access as Title II or common carrier. This further led to the scrutiny of the telecom industry. Hence, the increasing number of mandates and risk of penalty charges for non-compliance have led to an increased demand for EGRC solutions among telecom companies.

Regional Insights

North America led the global market in 2020 with a revenue share of over 32% and is expected to retain the dominant position over the forecast period. North America is home to many large-scale companies that are constantly at the risk of cyberattacks and government scrutiny. Hence, organizations are opting for agile and advanced software solutions that entail fewer resources due to veritable staffing drought and cyber threats. GRC solutions help manage the general activities of organizations. Various organizations have adopted different compliance and risk management programs to avoid monetary losses. Moreover, the growing adoption of big data, IoT, and cloud software technologies in North America is anticipated to propel product adoption over the forecast period.

Asia Pacific is expected to emerge as the fastest-growing regional market over the forecast period. This is attributed to the growing IT industry in India and the manufacturing sector in China. The impact of Covid-19 on the business operations of these industries and the further need for risk assessments are expected to create new opportunities for EGRC vendors. Other prominent countries contributing to the region’s growth include Japan, South Korea, Taiwan, Vietnam, and Indonesia. Furthermore, the rapidly developing IT infrastructure and the need to tackle internal and external business risks are also responsible for driving the market growth.

Key Companies & Market Share Insights

Vendors are focusing on launching upgraded solutions and forming partnerships to provide solution suites in line with the new and upgraded governance policies. For instance, in September 2020, OneTrust, LLC unveiled its GRC solution for the integrated risk management platform, which streamlines audits, implements dynamic business controls, and connects departments for managing risks. In January 2020, XebiaLabs launched security and compliance risk assessment tracking for software to assist in application release status information and assess security and compliance risks related to failing in product releases, production security vulnerabilities, and IT governance violations.

Acquisitions have also helped companies in finding new market avenues for growth. For instance, in March 2019, SAI Global Pty Limited acquired BWise, a risk, and regulatory compliance management platform, from Nasdaq, Inc. Under the acquisition, BWise combined its risk management, regulatory compliance management, and internal audit platforms with SAI Global Pty. Ltd.’s SAI360 risk and compliance platform. Furthermore, as per the acquisition, BWise introduced SAI Global Pty. Ltd.’s risk and compliance solutions along with ethics and compliance learning contents to its customers. In September 2020, the acquisition of RSA Archer was completed by a consortium of Ontario Teachers’ Pension Plan Board (Ontario Teachers), Symphony Technology Group (STG), and AlpInvest Partners (AlpInvest). The acquisition was aimed at enabling RSA Archer to operate as an independent organization specializing in cybersecurity and risk management. Some of the prominent players in the global enterprise governance, risk & compliance (EGRC) market include:

  • SAP SE

  • MetricStream, Inc.

  • Thomson Reuters

  • Wolters Kluwer

  • IBM

  • Microsoft

  • Oracle

  • SAS Institute

  • RSA Archer

  • FIS

  • Software AG

  • SAI Global

  • ProcessGene

  • LogicManager

  • NAVEX Global

  • Ideagen

  • Alyne

  • MEGA International

Enterprise Governance, Risk & Compliance Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 39.5 billion

Revenue forecast in 2028

USD 97.3 billion

Growth rate

CAGR of 13.7% from 2021 to 2028

Base year for estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million/billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, competitive ranking, competitive landscape, growth factors, and trends

Segments covered

Component, software, services, enterprise type, vertical, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; U.K.; Germany; China; India; Japan; Brazil; Mexico

Key companies profiled

 SAP SE; MetricStream, Inc.; Thomson Reuters; Wolters Kluwer; IBM; Microsoft; Oracle; SAS Institute; RSA Archer; FIS; Software AG; SAI Global; ProcessGene; LogicManager; NAVEX Global; Ideagen; Alyne; MEGA International

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional, and segment scope.

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Segments Covered in the Report

This report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global enterprise governance, risk & compliance market report on the basis of component, software, services, enterprise type, vertical, and region:

  • Component Outlook (Revenue, USD Million, 2016 - 2028)

    • Software

    • Services

  • Software Outlook (Revenue, USD Million, 2016 - 2028)

    • Audit Management

    • Compliance Management

    • Risk Management

    • Policy Management

    • Incident Management

    • Others

  • Services Outlook (Revenue, USD Million, 2016 - 2028)

    • Integration

    • Consulting

    • Support

  • Enterprise Type Outlook (Revenue, USD Million, 2016 - 2028)

    • Small and Medium Enterprise (SME)

    • Large Enterprise

  • Vertical Outlook (Revenue, USD Million, 2016 - 2028)

    • BFSI

    • Construction & Engineering

    • Energy & Utilities

    • Government

    • Healthcare

    • Manufacturing

    • Retail & Consumer Goods

    • Telecom & IT

    • Transportation & Logistics

    • Others

  • Regional Outlook (Revenue, USD Million, 2016 - 2028)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

      • Mexico

    • Middle East & Africa (MEA)

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