DORA compliance is quickly becoming essential for financial businesses because it helps strengthen defenses against cyber threats. Think of DORA as a cybersecurity roadmap that makes it easier for financial institutions to protect their systems, data, and customers from cyberattacks and technical breakdowns.
Why is DORA so urgent? With the rise in cyberattacks targeting financial institutions, even a single breach can ripple across the whole economy. Recognizing this risk, the EU Parliament has mandated that financial entities within the EU comply with DORA by January 2025. This regulation isn’t just a recommendation—it’s a requirement that pushes companies to build a strong, proactive cybersecurity posture. But no need to worry, with DigiFortex Technologies’ expertise, navigating DORA’s requirements becomes simpler and more effective. Our team guides you through each step, ensuring your compliance efforts are smooth and tailored to your unique needs.
DORA’s popularity across the EU and beyond highlights its value—it’s not just about ticking a compliance box but about creating a resilient environment where businesses and clients feel secure. By following DORA, financial institutions can reinforce trust, minimize risks, and stay ahead in a digital world where strong security is more crucial than ever.
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Let's understand DORA
DORA, established by the European Council, is an EU regulation aimed at enhancing the digital resilience of financial institutions and their external service providers in the face of operational disruptions. By implementing stringent ICT incident management protocols, DORA helps these organizations effectively resist, manage, and recover from cyber threats and technical failures. As part of a larger EU initiative to ensure financial sector stability, the regulation enforces comprehensive standards for risk management, incident reporting, and ICT resilience. It also works in harmony with other EU cybersecurity laws, such as GDPR and the NIS2 Directive, to further minimize the impact of digital disruptions and data breaches on the financial industry.
Are you required to comply with DORA? Let’s find out!
DORA applies to financial institutions, covering all financial entities; however, its specific requirements depend on factors such as company size, activities, and the level of risk involved. Following are the in-scope entities which are required to comply with DORA:
- The Financial Services Industry
- Payment institutions
- Investment firms
- Insurance companies
- Credit rating agencies
- Crypto-asset service providers
- Crowdfunding service providers
- Data analytics and audit services
- Fintech
- Trading venues
- Financial system providers
- Credit institutions
The major requirements to comply with DORA
The DORA regulation is built around five key pillars, each outlining specific requirements for financial entities to effectively withstand, respond to, and recover from ICT-related threats. The five pillars of DORA compliance are as follows:
- ICT Risk Management:
- ICT Incident Reporting:
- Digital Operational Resilience Testing – DORT
- ICT Third Party Risk Management:
- Information and Intelligence Sharing (Optional)
Financial entities must implement and maintain comprehensive ICT risk management frameworks covering every stage of an ICT system’s lifecycle. These frameworks should include robust cybersecurity measures for identifying, protecting against, detecting, responding to, and recovering from cyber threats, both within the organization and across the supply chain. Continuous monitoring and testing are also mandated to ensure the ongoing effectiveness of these measures.
Identify and Assess: Document all critical assets and assess potential risks and vulnerabilities within the scope.
Mitigate and Monitor: Create a mitigation strategy such as implementing Firewalls, encryption and access controls as well as set up a continuous monitoring system for real time threat detection.
Document and Update: Document and update your Risk Managment framework to reflect new threats and changes on a regular basis.
Entities are required to report significant ICT incidents to their regulators without delay. This helps provide a clearer understanding of ICT risks within the financial sector and promotes coordinated responses to major incidents.
Define and categorize: Set clear definitions for different types of incidents and establish communication channels for reporting.
Create and educate: Develop response protocols and offer ongoing training to employees on how to manage incidents.
Test and improve: Run drills to assess the reporting process and refine procedures based on the outcomes and feedback.
DORA mandates that firms regularly assess their ability to endure various ICT disruptions. This includes conducting threat-led penetration testing (TLPT) to simulate cyberattacks and evaluate the strength of their cybersecurity defenses.
Plan and execute: Establish a consistent testing schedule, incorporating penetration tests and simulated cyberattacks.
Assess and address: Analyze the results of tests to pinpoint system vulnerabilities and apply the necessary corrections.
Reevaluate and improve: Regularly review testing protocols to ensure they remain in line with evolving threats and industry best practices.
The regulation sets out requirements for managing cyber risks associated with outsourcing critical financial services to third-party ICT providers. Financial entities must ensure proper oversight and due diligence processes for these third-party service providers, along with robust risk management strategies to minimize the occurrence of significant incidents, such as data breaches.
Evaluate and track: Perform both initial and continuous assessments of third-party vendors’ resilience and risk management practices.
Contract and prepare: Ensure contracts include resilience requirements and establish contingency plans for potential vendor failures.
Document and reassess: Keep a risk register for third-party relationships and regularly review their performance.
DORA encourages financial entities to share cyber threat information and intelligence, fostering collaboration to strengthen the sector’s ability to detect, defend against, respond to, and recover from ICT-related incidents. The regulation facilitates this information-sharing while safeguarding data protection.
Clarify and delegate: Clearly define roles and responsibilities for ICT risk management within the organization.
Supervise and communicate: Establish a governance committee and ensure proper reporting channels to senior management.
Evaluate and improve: Introduce accountability measures and conduct regular reviews of governance structures to ensure their effectiveness.
Roadmap to DORA implementation
The Digital Operational Resilience Act (DORA) is a comprehensive regulatory framework that mandates financial entities to adopt a structured approach for implementation. At DigiFortex Technologies’, we have developed a tailored, step-by-step roadmap designed to make achieving DORA compliance as seamless and effective as possible. Our approach is highly customizable—based on each client’s unique needs, business structure, and risk landscape—to ensure the process is straightforward and aligned with your operational realities. Here’s an overview of how we support your organization through each stage of DORA compliance:
- Determine the Scope
- Gap Analysis
- Remediation Plan
- Identify critical third-party ICT providers
- Implement a Threat-Led Penetration Testing – TLPT
- Implement an approved TLPT framework, such as TIBER-EU
- Ensure that the TLPT framework addresses multiple or all critical functions of the financial entity
- Define the scope of the TLPT framework and obtain approval from a competent authority, as outlined in Article 46 of the DORA
- When ICT third-party service providers are included in the TLPT scope, take necessary measures to ensure their participation and apply appropriate safeguards
- Conduct testing on live production systems
- Perform testing at least every three years, based on the risk portfolio and operational circumstances
- Provide a summary of key findings, corrective action plans, and documentation showing that the test complies with the requirements
- Implement early warning indicators
- Set up procedures for detecting, monitoring, recording, and categorizing ICT-related incidents
- Designate roles and responsibilities for incident management
- Develop communication and notification plans for informing all key stakeholders and senior management about ICT-related incidents
- Report significant ICT-related incidents to the appropriate senior management and governing body.
- Identify, categorize, and accurately document ICT business functions, information assets, roles, and interdependencies
- Evaluate cyber threats and vulnerabilities that are relevant to ICT-supported business operations
- Conduct further risk assessments when there are significant changes to the network or infrastructure
- Keep up-to-date inventories of information assets, processes reliant on ICT third-party service providers, and legacy ICT systems and technologies
- Regularly carry out ICT risk assessments on all legacy ICT systems
- Establish information security policies to maintain data protection Documentation
- Define roles and responsibilities for ICT-related functions and establish governance structures
- Develop and approve a strategy for digital operational resilience
- Review and authorize ICT business continuity plans, internal audit plans for ICT, and the use of third-party ICT services
- Stay informed about the latest developments and expertise in ICT risks
- Allocate an adequate budget for ICT resources, security awareness initiatives, and digital operational resilience training
We can simply determine if our organization is an in-scope entity, i.e., a financial institution or critical ICT service provider to any financial institution. Additionally, this also involves factors such as the size of your business, the type of service you offer and your establishment in the European Union.
Once we are aware of the scope, we can start the Gap Assessment against the DORA compliance requirements to identify the current gaps. Once we identify the gaps, we can determine the current state of the organization and compare it with the desired state i.e., DORA compliant
Once we have identified the gaps, we can move forward to address the gaps by creating tailored treatment plans. Our expertise team will prioritize actions based on risk and resources and ensure that the plan is implemented in a more realistic method.
Ensure that your list of third-party ICT providers is always up to date. Now we need to identify the third-party ICT providers which are classified as critical under Article 31 of the DORA Act. We need to ensure those third parties are fully compliant with DORA. To implement continuous monitoring for the same we can perform due diligence for all such third-party ICT providers.
According to Article 26 of the DORA regulation, financial entities are required to conduct TLPT testing at least once every three years.
Develop an Incident Response Plan
Article 17 of the DORA mandates that financial entities establish, implement, and define a process for managing ICT-related incidents, ensuring they can detect, handle, and report such incidents.
Continuous ICT Monitoring
As per Article 8 of DORA, financial entities are required to continually identify all sources of risk within their ICT risk management framework.
Board Duties and Responsibilities
Article 5 of DORA requires that board members and executive management take ultimate responsibility for managing ICT risks and ensuring digital operational resilience.
Documentation
It is recommended to document records of the entire implementation of the regulatory compliance – risk assessment, incident reports, third-party risk management, due diligence reports etc. Documentation is the foundation that supports an organization’s compliance and efforts during an audit.
How can DigiFortex help your organization?
DigiFortex Technologies Pvt. Ltd. provide the expertise needed to navigate DORA’s regulatory landscape, helping you meet your organization’s resilience goals. Leveraging extensive experience in UK regulatory compliance, we offer valuable insights into the connections and overlaps with DORA’s requirements. We are seasoned and certified V-CISO, GRC, Privacy & Security Experts. We come as early members of McAfee and from Big 4 Consulting firms, top Indian and Israeli startups as well as hold 17 US Patents across the security and beyond.
Next Steps for Your Business
- Within our strategic consulting framework, we work with stakeholders in the financial sector to design, implement, or evaluate the effectiveness of their ICT risk management protocols, compliance status, and resilience strategies
- We offer a complete Digital Operational Resilience Act (DORA) consulting service, including gap analysis, implementation assistance, training, policy development, ICT testing, and continuous monitoring to help organizations achieve and sustain DORA compliance
- Our team, led by seasoned consultants, delivers thorough and expert DORA consulting experience
- DigiFortex’s DORA consulting engagement helps your organization elevate its ICT risk management compliance
- Get in touch with us to begin your journey
