Strengthening digital resilience with contract lifecycle management and contract intelligence in the era of DORA

Have you heard of the DORA regulation?

As the financial sector increasingly embraces digitalization to improve services and streamline processes, it also faces new challenges such as cyber-attacks, data breaches, system failure, and other digital risks. To tackle these issues, the European Union introduced the Digital Operational Resilience Act (DORA) regulation, on January 2023.

The DORA regulation aims to help financial companies resist, respond to, and recover from any operational disruption related to information and communication technologies (ICT). This regulation applies to all 27 EU Member States and covers credit institutions, payment institutions, crypto-asset service providers, insurance and reinsurance companies, asset managers, and third-party ICT service providers. By January 17, 2025, these companies are required to implement the DORA guidelines.

Managing third-party risks and contractual agreements

One of the major pillars of the DORA regulation is analyzing the potential risks posed by third-party ICT service providers. This regulation covers five distinct areas of ICT risk management, including governance and organization, ICT risk management framework, ICT incident management, classification, reporting, and information sharing, digital operational resilience testing, and third-party supplier risk management. Financial organizations must frequently assess all contractual agreements that include descriptions of the scope of services.

Complying with these measures can be challenging, given the critical volume of data and contracts financial entities must manage. To fulfill this compliance challenge, organizations should consider adopting automated contract lifecycle management solutions like Conga CLM and contract intelligence solutions like Conga Contract Intelligence, including artificial intelligence functions.

Contract lifecycle management and artificial intelligence, the keys to compliance

AI-based contract management and analysis use a central data repository as a single source. This means that a finance company can consolidate all contracts with external ICT providers in one place. This minimizes the risk of overlooking certain agreements and avoids any risk of non-compliance with DORA. Conga CLM, along with Conga Contract Intelligence, can also map the entire contract lifecycle, from contract signing through to the whole validity period, termination, and post-contract period. This is done securely, transparently, and in a time-saving way.

Combined with contract lifecycle management, contract intelligence allows financial organizations to automate the creation, management, and execution of contracts, reducing human error, accelerating contract cycles, and improving operational efficiency. Besides, integrating AI improves decision-making by providing predictive analytics based on complex data models. This helps financial institutions anticipate market trends, manage risk, and make more informed decisions. By leveraging AI tools to analyze existing contracts and extract relevant information, financial organizations can facilitate risk management and regulatory compliance, notably by monitoring contracts and automatically alerting to potential changes in legislation.

Sustainability, beyond compliance

By adopting these technologies, DORA-enabled organizations can strengthen their digital resilience, improve their operational agility, and deliver more efficient and personalized services to their customers. In addition to compliance, greater digital operational resilience will enable companies to cope with any systemic shock and demonstrate their commitment to protecting the security of their customers' personal and financial data. These are significant challenges for financial organizations, both for their business's long-term survival and reputation, in a challenging economic climate and a highly competitive market.

Therefore, financial firms must take the necessary steps to comply with the DORA regulation immediately by adopting automated contract lifecycle management solutions and contract intelligence solutions. With Conga CLM and Conga Contract Intelligence, financial organizations can streamline their processes, mitigate risks, and improve their business outcomes.