In today’s increasingly digital financial landscape, cybersecurity and operational resilience are more critical than ever. The European Union’s Digital Operational Resilience Act (DORA) represents a significant step forward in ensuring that financial institutions can withstand, respond to, and recover from cyber threats and other operational disruptions. DORA builds on existing regulatory frameworks like BAIT (Bankaufsichtliche Anforderungen an die IT) and VAIT (Versicherungsaufsichtliche Anforderungen an die IT) to create a comprehensive approach to IT security and operational resilience.
This blog explores the core aspects of DORA, how it integrates with BAIT and VAIT, and how Bersch Consulting can support your organization in meeting these new requirements.
What is DORA?
The Digital Operational Resilience Act (DORA) is part of the EU’s broader strategy to enhance the resilience of the financial sector. It sets out requirements for financial institutions to ensure that their information and communication technology (ICT) systems are robust enough to withstand a wide range of operational risks, particularly those related to cybersecurity.
Key Components of DORA:
- ICT Risk Management: DORA requires financial entities to implement and maintain a comprehensive ICT risk management framework. This includes regular risk assessments, effective mitigation strategies, and robust internal controls to manage and reduce ICT-related risks.
- Incident Reporting: Under DORA, financial institutions must report significant ICT-related incidents to their national competent authorities. This is intended to ensure timely responses to cyber threats and other operational disruptions.
- Digital Operational Resilience Testing: DORA introduces requirements for testing digital operational resilience, including penetration testing, scenario-based testing, and other stress tests to evaluate the effectiveness of ICT systems and controls.
- Third-Party Risk Management: DORA places a strong emphasis on managing risks associated with third-party ICT service providers. Financial institutions must ensure that their third-party providers meet the same high standards of resilience and cybersecurity as they do.
How DORA Builds on BAIT and VAIT
DORA does not exist in a vacuum. It builds on existing national regulations like BAIT and VAIT, which set out IT requirements for banks and insurance companies in Germany, respectively.
- BAIT (Bankaufsichtliche Anforderungen an die IT): BAIT outlines the IT security requirements for banks in Germany. It covers areas such as IT governance, information security, and the management of IT outsourcing. DORA expands on these requirements by introducing more stringent and standardized ICT risk management and reporting obligations across the EU.
- VAIT (Versicherungsaufsichtliche Anforderungen an die IT): VAIT sets similar IT requirements for insurance companies in Germany, focusing on IT governance, information security, and the management of third-party providers. DORA extends these principles, ensuring that all financial institutions across Europe adopt a harmonized approach to operational resilience.
By building on the foundations laid by BAIT and VAIT, DORA aims to create a uniform standard for ICT risk management across the entire EU financial sector. This not only strengthens individual institutions but also contributes to the stability and resilience of the broader financial system.
How Bersch Consulting Can Help
Implementing the requirements of DORA, while building on the existing frameworks of BAIT and VAIT, can be a complex and resource-intensive task. Bersch Consulting offers a range of services to help your organization navigate this regulatory landscape with confidence.
Our Services Include:
- ICT Risk Management Frameworks: We help you design and implement robust ICT risk management frameworks that meet the stringent requirements of DORA, while also aligning with BAIT and VAIT standards.
- Incident Response Planning: Our experts assist in developing comprehensive incident response plans, ensuring that your organization can respond quickly and effectively to ICT-related incidents.
- Resilience Testing: Bersch Consulting provides support in conducting digital operational resilience tests, including penetration testing and scenario-based testing, to evaluate and strengthen your ICT systems.
- Third-Party Risk Management: We guide you in managing risks associated with third-party ICT service providers, ensuring compliance with DORA’s rigorous standards.
Navigating the complexities of DORA, BAIT, and VAIT requires specialized knowledge and experience. Bersch Consulting is here to support your organization every step of the way, ensuring that you not only comply with these regulations but also enhance your overall operational resilience.
Contact Bersch Consulting today to learn more about how we can help you prepare for DORA and build a stronger, more resilient financial organization.