DORA critical and important functions: Key insights and requirements

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Reviewed by: Nojus (Noah) Bendoraitis

Navigating the EU’s Digital Operational Resilience Act (DORA) is a challenge that no financial institution can afford to sideline. With its focus on critical and important functions, DORA redefines how financial entities prepare for and respond to disruptions. Compliance is no longer just a checklist; it’s an opportunity to strengthen resilience in a hyper-connected digital world.

In this article, I’ll explore the five pillars of DORA, unpack their requirements, and examine practical strategies to embed resilience into your operations.

Understanding DORA: A quick overview

At its heart, DORA is a blueprint for digital operational resilience. The regulation is designed to protect financial institutions from ICT-related risks, such as cyberattacks and system failures, by ensuring that critical functions remain operational during disruptions.

The table below provides an at-a-glance overview of DORA’s five interconnected pillars. Each serves a specific purpose, but together, they form a comprehensive framework for resilience:

5 DORA pillars

DORA pillarPurpose
ICT risk managementBuilding frameworks to identify, assess, and mitigate risks across ICT systems.
ICT incident reportingEstablishing structured processes for detecting, managing, and reporting ICT incidents.
Digital operational resilience testingValidating the resilience of ICT systems under stress through advanced testing techniques.
ICT third-party risk managementManaging risks introduced by outsourcing critical services to external providers.
Information sharingEncouraging collaboration and sharing threat intelligence to strengthen sector-wide defense.

This table provides a high-level view of the regulation’s scope. In the sections below, I’ll break down each pillar, explain their requirements in detail, and outline actionable cybersecurity strategies to achieve compliance.

1. ICT risk management: Laying the groundwork for resilience

ICT risk management is the foundation of DORA. This pillar requires organizations to proactively identify and mitigate risks that threaten ICT systems. Without a strong framework, even minor vulnerabilities can escalate into significant disruptions.

The table below summarizes the main requirements for ICT risk management:

Requirements for ICT risk management compliance

RequirementExplanation
Risk identification and assessmentRegularly evaluate vulnerabilities, including insider threats, external cyberattacks, and operational risks.
Governance and accountabilityAssign responsibility for ICT risks to senior leadership, ensuring clear decision-making authority.
Resilience policies and controlsDevelop policies to address risks, including system downtime, data breaches, and compliance issues.

These requirements ensure that risk management efforts are structured and aligned with organizational goals. A proactive approach helps organizations prevent disruptions instead of reacting to them.

To address these risks, specific cybersecurity measures are essential. The table below outlines key technologies and strategies for ICT risk management:

Cybersecurity measures for ICT risk management compliance

Cybersecurity measurePurpose
Zero-trust architecturesContinuously verify user and device access to critical systems, minimizing insider and external threats.
Automated patch managementEnsure vulnerabilities in software and systems are promptly addressed with minimal manual intervention.
Network segmentationIsolate sensitive systems and data to limit the impact of breaches and unauthorized access.

By implementing these measures, financial institutions can address vulnerabilities and improve their overall resilience against operational risks.

2. ICT incident reporting: Responding with speed and precision

Timely detection and reporting of ICT incidents are critical under DORA. This pillar ensures organizations can manage disruptions efficiently, minimize impact, and maintain trust with stakeholders and regulators.

The table below highlights the core requirements for incident reporting:

Requirements for ICT incident reporting compliance

RequirementExplanation
Incident detectionUse advanced monitoring tools to detect unusual activity and potential disruptions in real-time.
Structured reportingReport significant incidents to authorities within 24–72 hours, depending on severity and regulatory requirements.
Post-incident analysisReview root causes of incidents and document corrective actions to prevent recurrence.

These requirements encourage organizations to establish structured workflows that emphasize speed and accountability.

To enhance incident response capabilities, the following cybersecurity measures are invaluable:

Cybersecurity measures ICT incident reporting compliance

Cybersecurity measurePurpose
Incident playbooksDefine step-by-step response plans for common scenarios like ransomware attacks or phishing campaigns.
Forensic toolsInvestigate breaches and gather evidence to address root causes and improve defenses.
Automated alertsTrigger real-time notifications when anomalies are detected to ensure swift action.

By integrating these tools and strategies, organizations can shift from reactive responses to a proactive incident management approach.

3. Digital operational resilience testing: Validating your defense

Resilience testing under DORA requires organizations to simulate real-world disruptions and evaluate the robustness of their systems. This pillar ensures that critical systems can withstand stress and recover quickly.

The following table outlines the main testing requirements:

Requirements digital operational resilience testing compliance

RequirementExplanation
Vulnerability scansRegularly identify weaknesses in critical systems and applications.
Scenario-based testingSimulate extreme scenarios, such as prolonged outages or coordinated cyberattacks.
Penetration testingProbe systems to uncover exploitable vulnerabilities before attackers can exploit them.

These tests help organizations uncover hidden vulnerabilities and assess their response mechanisms.

For effective resilience testing, organizations can leverage the following cybersecurity techniques and tools:

Cybersecurity measures digital operational resilience testing

Cybersecurity measurePurpose
Purple teamingCombine offensive (red) and defensive (blue) testing to evaluate vulnerabilities and response effectiveness.
Threat emulation toolsUse frameworks like MITRE ATT&CK to replicate real-world attack tactics.
Backup testingEnsure backups are secure, tamper-proof, and capable of rapid restoration during disruptions.

These advanced techniques provide insights that traditional audits may overlook, enabling organizations to address potential gaps before disruptions occur.

4. ICT third-party risk management: Securing the chain

Third-party providers are indispensable in today’s financial landscape, but they also introduce significant risks. DORA’s third-party risk management pillar ensures that outsourcing doesn’t compromise operational resilience.

The table below summarizes key requirements for managing third-party risks:

Requirements for ICT third-party risk management

RequirementExplanation
Vendor due diligenceEvaluate the resilience and security practices of providers before engagement.
Continuous monitoringRegularly review vendor performance and adapt risk profiles as circumstances change.
Exit strategiesCreate contingency plans to transition services smoothly in case of vendor failure.

To further strengthen third-party oversight, organizations should adopt the following cybersecurity measures:

Cybersecurity measures for ICT third-party risk management

Cybersecurity measurePurpose
Access controlsRestrict vendor access to critical systems, limiting potential exposure to unauthorized activities.
Supply chain mappingIdentify and assess dependencies to anticipate and mitigate cascading failures.
Joint response protocolsCoordinate with vendors to ensure unified responses to shared risks like data breaches.

By implementing these practices, financial institutions can reduce the risks associated with outsourcing while maintaining compliance.

5. Information sharing: Strengthening collective defense

No organization can address cyber threats in isolation. DORA’s emphasis on information sharing fosters collaboration across the financial sector, creating a unified front against cyber risks.

The table below highlights the requirements for information sharing:

Requirements for information sharing compliance

RequirementExplanation
Threat intelligence sharingExchange insights on vulnerabilities, attack patterns, and mitigation strategies with peers.
Cooperative defense mechanismsParticipate in joint exercises and initiatives to strengthen sector-wide defense.
Confidentiality protocolsEnsure sensitive data is shared securely to protect client and organizational privacy.

Organizations can also benefit from these cybersecurity measures to facilitate effective collaboration:

Cybersecurity measures for information sharing compliance

Cybersecurity measurePurpose
Automated threat feedsUse platforms like STIX/TAXII to streamline real-time sharing of threat intelligence.
Data anonymization toolsProtect sensitive information by removing identifiable details before sharing intelligence.
Sector-wide simulationsParticipate in coordinated exercises to build readiness for large-scale cyber incidents.

By sharing intelligence securely and effectively, financial institutions can contribute to a stronger and more resilient financial ecosystem.

DORA: The blueprint for resilience

DORA’s pillars provide more than compliance guidelines—they represent a strategic framework for long-term operational resilience. By addressing ICT risks, incident management, resilience testing, third-party oversight, and collaboration, organizations can safeguard their critical functions in a dynamic digital landscape.

Start your journey today by assessing your current practices, investing in cutting-edge cybersecurity measures, and fostering a culture of resilience. The question isn’t if disruptions will happen, but whether you’re ready when they do. With DORA, the roadmap is clear.

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