Protecting your firm's data is one of the most crucial steps you can take to maintain client trust and ensure your firm's information is reliable, accurate and secure. However, knowing how best to structure your data governance team can be difficult.
Building a team that works well together can be tricky because each member brings unique skills and expertise but also needs to work within the firm's vision and budget.
In this post, we explore how you can build an effective data governance team for your CPA firm and lay the groundwork needed to ensure all stakeholders have clarity on roles, responsibilities and expectations.
What is data governance?
Data governance is a set of processes, policies and standards that helps ensure data accuracy, consistency, security and availability across an organization. It provides a framework for how data is collected, stored, used and shared to meet the business's needs. The goal is to provide a high level of certainty that the data held within an organization is reliable, secure and up-to-date.
Why is data governance important?
Data governance is crucial because it helps ensure your data's accuracy and security. Data is a valuable asset, and proper management ensures it's properly managed, stored and used.
Data governance and management also help protect confidential information from unauthorized access or misuse and reduce risk by ensuring that only reliable and accurate information is used in decisions and operations.
Data governance can be challenging because there is no one-size-fits-all approach. Every organization's needs and circumstances are different. Depending on the data in question, you may have to comply with regulations and best practices prescribed by several organizations, such as the Equal Employment Opportunity Commission (EEOC), the Department of Labor, the Internal Revenue Service, the AICPA, and other governing bodies and standard-setting organizations. For this reason, it's essential to tailor the data governance team structure and processes to fit your firm.
What does a data governance team do?
Data governance teams are responsible for developing the firm's processes and policies, documenting them in a data governance plan, then monitoring and enforcing compliance on an ongoing basis. This can include training staff on properly handling sensitive information, reviewing data sets for accuracy and consistency, developing policies for secure data access and storage, and monitoring compliance with regulations.
The team should also develop a data governance strategy that outlines how the organization will handle data in the short-term, mid-term and long-term to ensure it stays current with changing business needs and regulations.
Considerations when structuring your data governance team
The first step in setting up a data governance team is to define the roles and responsibilities of each member. This will help ensure that everyone on the team has clarity on their role, knows what is expected of them and can work together efficiently. Here are some of the functions your data governance team might include:
Chief Data Officer (CDO). The CDO is responsible for developing and overseeing the overall data governance strategy. They should have a broad knowledge of data, technology and business processes to lead the team effectively.
Data Governance Manager. The Data Governance Manager is responsible for developing policies and procedures related to data governance and ensuring those policies and procedures are followed. They should have a deep understanding of data governance and the ability to communicate effectively with other team members.
Data Custodians. Data custodians are responsible for enforcing the data governance policies, ensuring that data is always accurate and secure. They should have a good understanding of the data in the organization and be able to detect anomalies or potential issues.
Data Analysts. Data analysts are responsible for analyzing the data within the organization, identifying trends and ensuring data is used effectively. They should have a good understanding of data and analytics and strong communication skills to explain what they've found.
Data Stakeholders. Data stakeholders may come from your tax, audit, advisory, admin or operations department. They are responsible for ensuring that data is used in a way that helps to meet the organization's goals and objectives. They should have strong knowledge of both the business processes and the data available and an understanding of how to use data to make better decisions.
Of course, the size of your data governance team and its roles depend on your firm's size. In a larger firm, data management may be the full-time responsibility of one or more team members. In a smaller firm, some of these responsibilities may already be in the hands of the IT team.
However you choose to handle it, remember that data governance isn't the sole responsibility of IT. Your IT team may not know anything about HIPAA, DOL or other laws and regulations you may need to comply with.
By properly structuring your data governance team, you can ensure that the data within your firm is secure and reliable while also helping to drive business objectives. With a well-structured data governance team in place, you can rest assured that your data is being used responsibly and in a way that supports the firm's goals.
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Erin Shively, IT Coordinator at Boomer Consulting, Inc., is excited to grow the company’s existing tech stack with new and emerging technologies. Her role includes troubleshooting technology issues, tracking and creating internal processes, and handling on-site tech set up for events at the Accounting Innovation Center.