Article 4 Digital Operational Resilience Act (DORA), Governance and Organisation
Article 4 of the Digital Operational Resilience Act (DORA) outlines essential governance and management responsibilities for financial entities to effectively manage ICT (Information and Communication Technology) risks. These obligations are pivotal in creating resilient frameworks that protect against cyber threats and maintain operational continuity within the financial sector.
Key Responsibilities of Financial Entities
Financial entities are required to establish strong internal governance and control structures that address ICT risks comprehensively. The management body of each financial entity is responsible for several critical tasks:
(a) Ultimate Accountability: The management body holds final accountability for managing ICT risks across the organization.
(b) Role Definition: Clearly defining roles and responsibilities related to ICT across all functions to ensure transparency and efficiency.
(c) Risk Tolerance: Establishing the appropriate level of risk tolerance for ICT risks, in alignment with the overall risk management strategy.
(d) Policy Oversight: Approving, overseeing, and periodically reviewing critical documents such as the ICT Business Continuity Policy and ICT Disaster Recovery Plan to ensure ongoing operational resilience.
(e) Audit Plans: Reviewing and approving ICT audit plans, the audits conducted, and any significant changes to these plans to thoroughly assess and mitigate ICT risks.
(f) Resource Allocation: Ensuring that sufficient budgetary resources are allocated to meet the organization's digital operational resilience needs, including ongoing training programs to enhance ICT risk awareness and skills among relevant staff members.
(g) Third-Party Policies: Approving and regularly reviewing policies for using ICT services provided by third-party providers to ensure regulatory compliance and protect against potential vulnerabilities.
(h) Contract Oversight: Staying informed of agreements with ICT third-party providers, including any planned significant changes and their potential impacts on critical business functions, supported by comprehensive risk analyses.
(i) Incident Response: Being promptly informed of ICT-related incidents, their operational impacts, and the measures taken for incident response, recovery, and corrective actions to ensure quick resolution and mitigation of disruptions.
Role Designation and Training
Financial entities, with the exception of microenterprises, must appoint a senior management member or designate a specific role to oversee all agreements with ICT third-party service providers. This role includes monitoring associated risk exposures and maintaining thorough documentation to support accountability and transparency.
Members of the management body are also required to participate in regular training sessions to continually update their knowledge and skills related to ICT risks. This ongoing education enables them to effectively understand, assess, and mitigate ICT risks, thereby strengthening the digital operational resilience of the financial entity.
Conclusion
Article 4 of DORA emphasizes the importance of robust governance structures, proactive management oversight, and continuous staff training to ensure the digital operational resilience of financial entities in the face of evolving ICT landscapes and emerging cyber threats.
