The DORA regulation (Digital Operational Resilience Act) presents financial companies with new challenges to ensure digital operational resilience. Digitalization plays a key role in this, especially in the area of contract management. In this article, you will learn how digital contract management can support the implementation of DORA and what steps are necessary for this.

Key findings

  • The DORA Regulation aims to strengthen digital operational stability in the financial sector.
  • Digital contract management enables automated and audit-proof contract processes.
  • Careful needs analysis and planning are essential for the implementation of digital contract management.
  • Increased efficiency and improved transparency are key benefits of digital contract management.
  • Technological trends and innovations, such as artificial intelligence, will shape the future of digital contract management.

Why DORA is important for financial companies

The objectives of the DORA Regulation

DORA aims to ensure that financial companies retain complete control over ICT risks. To this end, the requirements for ICT risk management are being tightened and standardized. The DORA regulation aims to strengthen the operational resilience of financial companies and ensure that they remain functional even in times of crisis.

Impact on the financial sector

The implementation of DORA requires a holistic view and further development of existing business processes. The use of the right tools not only optimizes workflows, but also supports demonstrable compliance with the new legal requirements and due diligence obligations. Not least because the management of financial companies is responsible for compliance with the regulations.

Important deadlines and milestones

The Digital Operational Resilience Act (DORA), a European Union regulation, came into force in January last year. The EU law must be implemented by January 17, 2025. Although DORA is primarily aimed at the financial sector, other companies, such as IT service providers, may also be affected. Companies that fall into this category or are themselves active in the financial sector should get ready for DORA now.

The role of digital contract management in DORA implementation

The implementation of the DORA Regulation presents financial companies with numerous challenges. Digitalization plays a central role in this. The decisive factor is where this needs to start in order to integrate all existing business processes.

Automated contract processes

Once the partner has been created and evaluated, digital contract management supports the subsequent contract process. When a new agreement is automatically generated, all DORA-specific information that the document must contain is transferred directly from the file to the contract. Examples include the evaluation of the outsourcing, the description of the outsourcing object, the criticality or the documentation of the assets.

Audit-proof documentation

Digital tools for audit-proof documentation and the automated creation of ad hoc and audit reports make it much easier to comply with DORA requirements. All relevant data is stored centrally and can be accessed at any time, which increases transparency and traceability.

Integration into existing systems

If financial companies want to digitize their business processes in a well thought-out way to implement DORA, they must therefore start at the source of the information - contract management. This is where all the data originates and the tasks to be completed can be controlled from it using structured workflows. From the initial sourcing of a supplier, through the conclusion of contracts, to the ongoing controlling and reporting of agreements: Smart integration into existing systems increases efficiency and ensures compliance with DORA specifications.

Steps for implementing digital contract management

Implementing digital contract management requires careful planning and execution. Here are the most important steps you should consider:

Needs analysis and planning

First of all, you should carry out a needs analysis to determine the specific requirements of your company. Which contracts need to be digitized? Which processes can be automated? A clear strategy will help you to define and prioritize the goals, requirements and processes of digital contract management.

Selecting the right software

Choosing the right software is crucial to the success of your digital contract management. Make sure that the software is adapted to the needs of your company and offers all the necessary functions. A suitable software solution should digitize contract creation, negotiation, approval, signing, storage and monitoring. PACTA is a contract management software that fully covers and automates every step of the contract lifecycle.

Training and change management

The introduction of digital contract management also requires qualified training for employees. They must be made aware of and trained in the use of the new software. Change management is also important to ensure acceptance and use of the new processes.

Digital contract management is not a sure-fire success, but requires careful planning, implementation and optimization. However, if these steps are successfully completed, contract management can become a decisive factor for the growth and future viability of a company.

Advantages of digital contract management for DORA compliance

With digital contract management, you can automate contract processes and thus save a considerable amount of time. Manual tasks such as creating, reviewing and archiving contracts are replaced by automated workflows. This leads to a significant increase in efficiency and allows your team to focus on more important tasks.

Digital contract management provides you with a central platform where all contracts and related documents are stored and managed. This ensures better traceability and transparency, as all changes and versions of a contract are fully documented. You can also access important information at any time and retrieve it quickly if required.

By automating and standardizing contract processes, you can significantly reduce the risk of errors and inconsistencies. Digital contract management ensures that all contracts comply with DORA requirements and thus minimizes the risk of compliance violations. You can also ensure that all contracts are always up to date through regular reviews and updates.

With digital tools for audit-proof documentation and automated creation of ad hoc and audit reports, you can efficiently meet the requirements of the DORA regulation. In addition, a transparent, process-driven data room enables the involvement of all stakeholders in the audit process to ensure compliance with all regulatory requirements.

Click here to find out more about DORA compliance with digital contract management.

Best practices for digital contract management

Successful contract management requires continuous attention: regular reviews and updates of contracts ensure that all agreements are up-to-date and legally compliant. This helps to identify and minimize potential risks at an early stage.

By using templates and standard processes, you can significantly speed up the contract process. Templates ensure consistency and reduce errors, while standard processes increase efficiency and facilitate compliance.

Good collaboration and communication between departments is crucial for effective contract management. Use digital tools to improve communication and ensure that everyone involved is always up to date.

Challenges in implementing DORA and how digital contract management helps

The implementation of the Digital Operational Resilience Act (DORA regulation) brings new obligations and challenges for financial organizations, but also presents an opportunity to strengthen IT security and operational resilience. Here are some of the biggest challenges and how digital contract management can help:

Dealing with cyber threats

Cyber threats are constantly on the rise. The aim of DORA is to establish a set of rules to ensure digital operational stability. Digital contract management can help by storing all security-relevant information centrally and controlling access to it. This allows you to ensure that only authorized persons have access to sensitive data.

Ensuring data integrity

Data integrity is a key aspect of the DORA regulation. Digital contract management systems offer functions for audit-proof documentation and automated generation of ad hoc and audit reports. This makes it much easier to comply with the DORA requirements.

Fulfillment of reporting obligations

DORA entails extensive reporting obligations. Digital contract management can provide support here by recording the necessary data in a structured manner and automatically generating reports. This saves you time and reduces the risk of errors.

Outlook for the future: How digital contract management could evolve

The world of digital contract management never stands still. New technologies such as blockchain and smart contracts could revolutionize the way contracts are created and managed. These technologies not only offer more security, but also greater automation and efficiency.

Potential for artificial intelligence

Artificial intelligence (AI) has the potential to take digital contract management to a new level. From automated contract creation to the intelligent monitoring and analysis of contract data - the possibilities are almost limitless. AI can help to minimize errors and increase efficiency.

How artificial intelligence works in contract management.

Expansion of functionalities

The future of digital contract management also lies in the expansion of existing functionalities. This includes integrating new modules for specific industry requirements and improving user-friendliness.

Conclusion

The implementation of the DORA regulation may seem complex at first glance, but this process is considerably simplified with well thought-out digital contract management. From contract creation to controlling and reporting - digital solutions offer the necessary transparency and efficiency. Companies that embrace these technologies early on will be well equipped to meet the requirements of the DORA regulation while strengthening their operational resilience. So, what are you waiting for? Start digitizing your contract management now and secure a competitive advantage!

PACTA's contract management successfully supports you in implementing the DORA regulation. Click here to find out more.

Frequently asked questions

What is the DORA regulation and why is it important?

The DORA regulation (Digital Operational Resilience Act) is a set of rules to ensure digital operational resilience in the financial sector. It is important for protecting financial companies against cyber risks and increasing the resilience of their digital systems.

What deadlines and milestones need to be observed when implementing DORA?

The DORA regulation contains specific deadlines and milestones that financial companies must adhere to. These include regular reporting and the implementation of certain security measures within specified periods.

How can digital contract management help with DORA implementation?

Digital contract management supports DORA implementation through automated contract processes, audit-proof documentation and integration into existing systems. It enables efficient management and tracking of all contract-relevant data.

What advantages does digital contract management offer for compliance with DORA?

Digital contract management offers numerous benefits for DORA compliance, including increased efficiency, time savings, improved transparency and traceability, and the reduction of risks and errors.

What are the challenges in implementing DORA?

The challenges of implementing DORA include dealing with cyber threats, ensuring data integrity and fulfilling reporting obligations. Digital contract management can help to overcome these challenges.

How do I choose the right software for digital contract management?

Choosing the right software for digital contract management requires a thorough needs analysis and planning. Important criteria include user-friendliness, integration capability, security functions and support from the provider.