Compliance Risk Management in Cybersecurity
Compliance Risk Management:
Cybersecurity Needs to be Front and Centre
Compliance Risk Management
Cybersecurity today is no longer just a technical function — it’s a compliance priority. Australian organisations are facing rising regulatory scrutiny, and compliance risk management has become a critical element of cybersecurity strategy.
What is Compliance Risk Management?
Compliance risk management refers to identifying, assessing, and addressing risks related to failing to comply with laws, regulations, standards, or contractual obligations. In the context of cybersecurity, this includes obligations such as:
- The Privacy Act 1988 (Cth)
- The Notifiable Data Breaches (NDB) scheme
- APRA CPS 234 for regulated financial entities
- Industry-specific codes (e.g. My Health Record legislation for healthcare)
Organisations must ensure their security policies, data handling procedures, and reporting mechanisms align with legal and regulatory expectations.
Why It Matters
Failing to manage compliance risks in cybersecurity can lead to:
- Regulatory penalties (fines up to $50 million under the amended Privacy Act)
- Data breaches and reputational harm
- Loss of contracts due to non-compliance with SLAs or ISO standards
The Australian Signals Directorate (ASD) and Office of the Australian Information Commissioner (OAIC) have both emphasised the need for compliance-informed cybersecurity programs.
Key Components of Compliance Risk Management
Risk Identification
- What are the relevant obligations under law or contract?
- Where is sensitive or regulated data stored and transmitted?
Risk Assessment
- Which areas of your business pose the greatest compliance risk?
- Are current controls effective?
Controls Implementation
- Technical safeguards (e.g. encryption, access control)
- Administrative controls (e.g. audit trails, training, vendor agreements)
Monitoring and Reporting
- Regular internal audits
- Real-time monitoring for anomalies and access violations
- Incident reporting aligned with OAIC or APRA timelines
Documentation and Continuous Improvement
- Maintain logs, policies, and evidence of compliance
- Perform post-incident reviews and update risk registers
Aligning with Frameworks
Use established compliance frameworks to benchmark and guide your practices:
- ISO/IEC 27001 (Information Security Management Systems)
- NIST Cybersecurity Framework
- Essential Eight Maturity Model (ASD)
For example, ISO 27001 Clause 18 specifically deals with compliance, requiring audit policies and procedures be implemented and reviewed regularly.
Final Thoughts
Managing compliance risk in cybersecurity is not just a legal exercise — it’s about building resilience and trust. With growing regulatory expectations in Australia, compliance risk management should be integrated into your overall governance, risk, and compliance (GRC) strategy.
It’s better to invest in controls now than to explain their absence during an investigation.