Understanding the Three Lines of Defence: Foundations for a Resilient Business

If someone told you GRC could be visualised as a medieval castle, your first thought might be: “Finally, something I understand!”

Enter the Three Lines of Defence model—your business’s castle walls against risk, compliance failures, and regulatory headaches. And yes, regulators love it when these walls are in place… especially in today’s fast-moving business world, where even small and medium-sized businesses are under scrutiny.

But here’s the kicker: walls alone aren’t enough. For the castle to stand, you need strong foundations—and that means linking your values, strategy, and goals to a true belief in delivery.

Think of it like this:

1. First Line – The Frontline:

Your operations teams are the everyday heroes. They own the risks, follow policies, and make sure the business runs smoothly. Like foot soldiers on castle walls, they’re alert, proactive, and responsible.

2. Second Line – Risk & Compliance Oversight:

Specialists in risk, compliance, or governance help the first line by providing guidance, policies, and monitoring. They’re your scouts and archers, ensuring nothing critical slips through.

3. Third Line – Independent Assurance:

Internal audit or external reviewers act as watchtowers, giving an objective assessment of how well the first and second lines are performing. They provide regulators and stakeholders with confidence that controls are real and effective.

A strong Three Lines of Defence isn’t just about processes—it’s about purpose. The foundation is what links your business values, strategy, and goals to the everyday work of risk and compliance:

• Values: What your business stands for drives behaviours. Employees naturally make better decisions when they understand and believe in the company’s core principles.
• Strategy: Your risk and compliance approach should support your business objectives, not hinder them. This ensures GRC is seen as enabling growth, not just policing it.
• Goals: Clear, measurable goals help every line of defence understand what “success” looks like, and why it matters.

When values, strategy, and goals are aligned with the Three Lines of Defence, employees don’t just follow rules—they believe in the outcome. And that belief is what drives consistency, accountability, and true resilience.

Modern regulators aren’t just checking for policies—they want evidence of a proactive culture:

• Accountability: Everyone knows their role and responsibilities.
• Proactive risk management: Risks are identified, assessed, and managed before they become problems.
• Independent assurance: Reviews and audits prove that controls work in practice, not just on paper.
• Adaptability: Businesses must evolve with emerging risks, technology, and regulations.

Even SMEs can impress regulators by showing that their Three Lines of Defence are rooted in purpose and connected to their strategy and values.

The Three Lines of Defence model isn’t complicated—it’s about clarity, accountability, and belief in delivery.

✅ You’re building strong foundations that link values, strategy, and goals.

✅ You’re embedding accountability across all lines.

✅ You’re creating a culture where everyone understands and believes in the importance of risk management and compliance.

When the foundations are right, the walls stand strong, the watchtowers are effective, and the castle—your business—is resilient, trusted, and ready to thrive.