Aligning NHI Governance With Financial Services Regulatory Expectations

Senior security leaders in banking and financial services operate in a continuous translation role. Security organizations generate high volumes of alerts, findings, and technical metrics. Boards of directors, audit committees, and supervisory authorities evaluate performance through a different lens: enterprise risk, regulatory exposure, and operational resilience. Alignment depends on whether security activity can be translated into those terms in a credible and repeatable way.

The board’s role is to define risk appetite, allocate capital, and ensure the institution can continue operating through disruption. Security teams must demonstrate measurable influence over loss exposure, supervisory confidence, and service continuity when thinking about selecting or implementing a specific technology or program. Controls, architectures, and tooling are inputs. Reduced likelihood of material loss and improved resilience are the outcomes that security leadership should strive to achieve.

In regulated financial institutions, compliance frameworks often serve as the initial proxy for risk management. They provide defensibility and a shared vocabulary in environments where the consequences are material. We can call this governance, and it shows that risk is intentionally managed, not just that security work is being performed.

Governance maturity develops when compliance evidence is consistently connected to changes in impact. That connection increasingly runs through identity governance and secrets security.

What Audit and Control Failures Have Cost Financial Institutions

Let’s take a look at the realities that keep enterprise leaders up at night. The financial consequences of regulatory enforcement clearly show what is at stake:

• OCC (2020) – Capital One Bank
  An $80 million civil money penalty was imposed for information security deficiencies and noncompliance with “Interagency Guidelines” following a major unauthorized access incident.
• FCA (2018) – Tesco Personal Finance
  A £16.4 million fine after a cyber attack enabled unauthorized transactions. The FCA cited deficiencies that exposed customers to avoidable harm and highlighted weaknesses in access controls and monitoring.
• SEC (2022) – Morgan Stanley Smith Barney
  A $35 million penalty related to failures to safeguard customer personal information, with regulators pointing to deficiencies in protective controls and oversight mechanisms.
• Poland DPA via EDPB (2025) – mBank
  An administrative fine of €928,498.06 related to GDPR Article 34 violations.

Across jurisdictions, the pattern is consistent. Regulatory cost increases when unauthorized access occurs, when access privileges are weakly governed, or when institutions cannot demonstrate that controls operate effectively and consistently over time. The absence of evidence often matters as much as the presence of technical safeguards.

Why Risk Framing Determines Security Credibility

Vulnerabilities, misconfigurations, and exposed…