The Committee of Sponsoring Organizations of the Treadway Commission (COSO) has released guidance on identifying and managing alternate data risk using the COSO ERM Framework.
‘Alternate Data: The COSO Perspective’, explores how COSO’s Enterprise Risk Management (ERM) Framework can be applied to the challenge and opportunity of the growing proliferation of alternative data (altdata).
What is altdata?
Altdata is generally understood to include information about an organization that is available outside of traditional financial and regulatory reporting channels, press releases, or other authorized materials. It includes data about an organization and its operations that the organization makes public or otherwise discloses to third parties knowingly or unknowingly.
The COSO ERM Framework can be used to help identify, assess, and address various risks relating to altdata, including inadvertent disclosure of sensitive or confidential information and reporting and compliance issues.
With the growth of online presence and the associated digital and data footprint that is left behind and publicly available about organizations, altdata presents both risks and opportunities with the accessibility and interpretability of such information. As the significance of data, but in this case specifically alternative data grows and evolves, companies should become familiar with their specific altdata risks and opportunities. COSO’s ERM Framework provides a great toolset for such an evaluation.
Lucia Wind, Executive Director & Chair of COSO
