- June 2, 2025
- Posted by: Gradeon
- Category: IT Infrastructure
The Digital Operational Resilience Act (DORA) is set to come into force in January 2025, marking a significant regulatory shift for financial entities across the European Union and impacting UK financial institutions with EU operations or clients. Designed to bolster the digital operational resilience of the financial sector, DORA requires firms to ensure they can withstand, respond to, and recover from ICT-related disruptions and threats.
For UK financial institutions, achieving DORA compliance is more than a regulatory requirement—it’s a strategic imperative. This article explores the core requirements of DORA, its implications for UK-based firms, and practical steps organisations should take to meet the January 2025 deadline.
Understanding DORA: A Quick Overview
DORA was introduced by the European Commission as part of the Digital Finance Package to harmonise ICT risk management across the EU financial sector. It applies to a broad spectrum of financial entities, including:
- Banks and credit institutions
- Investment firms
- Payment and e-money institutions
- Insurance and reinsurance companies
- Crypto-asset service providers
- ICT third-party service providers (including cloud providers)
Although the UK is no longer part of the EU, UK financial institutions operating within the EU, serving EU clients, or engaging with EU-based ICT providers will fall within DORA’s scope. Ignoring it could lead to reputational damage, service disruptions, or even exclusion from the EU market.
Key Pillars of DORA Compliance
DORA is structured around five core pillars. UK institutions must focus on aligning internal processes and technologies to meet each of these requirements:
1. ICT Risk Management
Firms must implement robust ICT risk frameworks to prevent, detect, respond to, and recover from ICT-related incidents.
Action Points:
- Conduct a full ICT risk assessment.
- Define roles and responsibilities for ICT risk governance.
- Implement controls and monitoring tools for risk identification and mitigation.
2. Incident Reporting
DORA mandates standardised reporting of ICT-related incidents, including major operational disruptions, to ensure transparency and early warning across the sector.
Action Points:
- Establish processes for real-time incident detection.
- Define thresholds for classifying major incidents.
- Develop a clear reporting workflow aligned with DORA timelines.
3. Digital Operational Resilience Testing (DORT)
Firms must conduct regular and advanced testing of their ICT systems, including threat-led penetration testing (TLPT) for critical functions.
Action Points:
- Plan and execute annual resilience testing exercises.
- Include third-party assessments and red teaming where applicable.
- Document findings and remediation steps for each test.
4. ICT Third-Party Risk Management
DORA introduces stringent oversight for third-party service providers, especially cloud and SaaS vendors.
Action Points:
- Create a comprehensive third-party inventory.
- Review existing contracts to include ICT risk clauses.
- Establish contingency plans and exit strategies for critical service providers.
5. Information Sharing
DORA encourages threat intelligence sharing among financial entities to foster a proactive cyber resilience posture.
Action Points:
- Join recognised information-sharing communities (ISACs).
- Integrate shared intelligence into internal threat models.
- Train staff on threat awareness and response based on shared data.
Why UK Financial Institutions Must Act Now
The countdown to 17 January 2025 is well underway. UK firms can no longer afford a “wait and see” approach. Delaying compliance efforts could result in:
- Regulatory penalties from EU supervisors
- Barriers to accessing EU markets
- Business continuity risks due to ICT vulnerabilities
- Loss of customer trust following digital disruptions
In addition, UK regulators such as the FCA and PRA are closely monitoring developments. Even if DORA isn’t directly enforced within the UK, its principles are consistent with UK regulatory expectations around operational resilience (e.g., the FCA’s PS21/3 framework).
If you’d like to explore the fundamentals further, take a look at our in-depth article: DORA Compliance – What UK Financial Firms Must Know
Steps to Achieve DORA Compliance by the Deadline
Here’s a practical roadmap UK financial institutions can follow to ensure timely and effective DORA alignment:
1. Conduct a Gap Analysis
Assess your current ICT risk and resilience posture against DORA’s requirements. Identify shortfalls in governance, policies, tools, and reporting mechanisms.
2. Form a DORA Steering Committee
Establish a cross-functional task force involving IT, compliance, legal, risk, and procurement to drive the compliance programme.
3. Update Policies and Frameworks
Revise ICT risk management policies, incident response protocols, and vendor governance frameworks to align with DORA.
4. Invest in Technology and Skills
Deploy tools for incident detection, threat intelligence, and resilience testing. Train staff on DORA-aligned practices, especially in cyber risk and third-party oversight.
5. Engage Third-Party Providers
Evaluate critical ICT suppliers for compliance readiness. Work collaboratively to align contracts and SLAs with DORA’s stipulations.
6. Monitor Regulatory Updates
Track updates from ESMA, EBA, and the ECB, as further technical standards (RTS) and guidelines are expected before the deadline.
The Role of IT Consultants and Cybersecurity Experts
Given the complexity of DORA requirements, many UK firms are turning to external experts for support. An experienced IT consultancy with expertise in cybersecurity, DORA compliance, and EU regulations can offer:
- Tailored gap analysis and risk assessments
- Development of resilience frameworks and incident playbooks
- Third-party vendor reviews and contract remediations
- Threat-led penetration testing and resilience simulations
- Ongoing compliance monitoring and reporting dashboards
Outsourcing to the right partner can significantly reduce the burden on internal teams while accelerating readiness for the 2025 deadline.
Final Thoughts
DORA is more than a compliance exercise—it’s a wake-up call for the financial sector to build cyber resilience into the heart of operations. For UK financial institutions, aligning with DORA ensures not only regulatory compliance but also future-proofing in an increasingly digital and interconnected landscape.
With the deadline fast approaching, the time to act is now. By proactively aligning ICT risk, governance, and third-party oversight with DORA’s pillars, UK firms can position themselves as secure, resilient, and trusted financial partners in the EU and beyond.
