From Regulation to Reality: DORA Compliance and What It Means for Your Software Security

The Digital Operational Resilience Act (DORA) is a landmark regulation designed to enhance the digital resilience of financial institutions in the EU. Effective from January 17, 2025, DORA mandates the development and maintenance of a robust ICT risk management framework. Here’s an overview of the five pillars and how the right software security measures can help you comply. 

Introduction to DORA and Its Objectives 

The DORA framework encompasses classifying, monitoring, preventing, and mitigating ICT-related risks, establishing processes for reporting major incidents, developing and regularly reviewing third-party risk management strategies, and enforcing a digital operational resilience testing program. These measures are crucial for protecting financial institutions (and others) from severe operational disruptions, such as cyberattacks and ICT incidents. For software security professionals, understanding how DORA’s five pillars—Risk Management, Third-Party Risk Management, Incident Reporting, Information Sharing, and Digital Operational Resilience Testing—impact their practices is essential. 

How Software Security Helps with DORA Compliance 

Let’s break the 5 pillars down and discuss how software security helps you comply with them. 

1. Risk Management 

Risk Management is the cornerstone of the DORA mandate, Risk Management focuses on identifying, assessing, and mitigating ICT risks to ensure high operational resilience through internal governance and control frameworks. Tools like Static Application Security Testing (SAST), Dynamic Application Security Testing (DAST), Software Composition Analysis (SCA), and Veracode Risk Manager (our ASPM solution) can help consolidate, correlate, prioritize, and remediate security findings and ensure software security practices are robust and aligned with DORA’s risk management requirements. 

2. Third-Party Risk Management 

Effective management of ICT third-party risks is crucial. This involves monitoring risks from third-party vendors and their vendors, ensuring that third-party service providers adhere to internal DORA standards, and incorporating these standards into contractual obligations. To help with this pillar, Veracode can assist by performing SCA on third-party libraries, managing Software Bill of Materials (SBOMs), and conducting security assessments of third-party applications and services. 

3. Incident Reporting 

Financial entities must establish processes to detect, manage, and notify any ICT-related incidents. This includes implementing mechanisms and using templates for notifying the regulator of ICT incidents. These processes are essential for software security, as they ensure that vulnerabilities and incidents are identified and addressed promptly. Veracode Analytics can provide comprehensive reporting and metrics for the security posture of applications, aiding in post-incident investigation and remediation. 

4. Information Sharing 

Collaboration and sharing of cyber threat intelligence among organizations are encouraged to enhance digital operational resilience and raise awareness. This pillar helps in staying informed about emerging threats and best practices, which is vital for maintaining a strong security posture. 

5. Digital Operational Resilience Testing 

Finally, financial entities must establish, maintain, and regularly review a comprehensive testing program to ensure digital operational resilience. This includes regular testing and scanning, addressing identified threats promptly, and ensuring that third parties are also conducting regular testing. Software security professionals can ensure compliance by implementing an effective Application Security (AppSec) testing program that includes SAST, DAST, and SCA, automating security testing within the CI/CD pipeline, and conducting regular penetration testing of critical applications. 

Conclusion 

By addressing these five pillars, financial institutions can enhance their digital operational resilience, safeguard themselves against fines for non-compliance and ensure that their software security practices are aligned with DORA standards. Veracode offers a range of tools and services, including SAST, SCA, DAST, Infrastructure as Code (IaC) scanning, and ASPM capabilities, to support organizations in meeting these regulatory requirements. Compliance with DORA not only helps in mitigating risks but also builds trust and confidence among stakeholders, ultimately contributing to the overall stability and security of the financial sector. Schedule a demo today, we’d love to help you build resilience in a digital world.