In the ever-evolving financial landscape, safeguarding customer trust and operational stability is paramount. This is where Digital Operational Resilience (DORA) and Prudential Standard PS21/3 come into play. These regulations aim to fortify the financial sector against cyber threats and supplier risks, ensuring a more resilient future.
Understanding Digital Operational Resilience (DORA) & PS21/3
DORA, a European Union regulation, establishes a unified framework for managing digital operational risks across the bloc. It applies to a wide range of financial institutions, including credit institutions, payment and electronic money institutions, investment firms, and insurance companies.
PS21/3, the UK counterpart, focuses on a firm’s understanding of its critical business services, processes, and the people and technology that support them. It emphasises impact tolerance – the acceptable level of disruption for these services.
DORA: Building a Strong Digital Foundation in the EU
DORA emphasises robust risk management practices for technology and third-party suppliers. Compliance will be mandatory by January 17, 2025. While implementing ISO 27001:2022 fulfils a significant portion of DORA’s requirements, additional measures might be necessary.
PS21/3: UK Focus on Business Impact and Resilience
Enforced since March 2022, PS21/3 mandates that firms identify their crucial business services, define acceptable disruption tolerances, and pinpoint vulnerabilities in their operational resilience. By March 2025, firms must demonstrate their ability to operate within these tolerances. Third-party vendors supporting “in-scope” businesses will also face increased compliance requirements.
How to Prepare for DORA & PS21/3 Compliance
Achieving compliance with DORA and PS21/3 requires a proactive approach. Here’s a starting point:
- Identify critical business services and their dependencies.
- Assess cyber and operational risks across your organisation.
- Implement robust incident response and recovery plans.
- Review and strengthen third-party vendor oversight.
- Consider adopting ISO 27001:2022 and ISO 27701:2019 for a comprehensive approach.
DORA and PS21/3 may seem complex, but they ultimately aim to create a more secure and stable financial environment. By taking proactive steps toward compliance, financial institutions can ensure their long-term success and protect their customers. Don’t hesitate to seek expert guidance – navigating these regulations doesn’t have to be a solitary endeavor.
Don't navigate the complexities of DORA and PS21/3 alone
Contact our team of experts at Risk Evolves today. We'll guide you through the compliance process and help you build a resilient financial future.
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