Incident Reporting

Incident reporting is a critical pillar of the Digital Operational Resilience Act (DORA), designed to ensure financial institutions detect, escalate, and report ICT-related incidents promptly and effectively.

This requirement is essential for maintaining operational transparency, mitigating the impact of disruptions, and aligning with regulatory expectations. Articles 15–17 of DORA outline the standards for incident reporting, as one of the five core requirements of DORA, alongside:

• ICT Risk Management
• Operational Resilience Testing
• Third-Party Risk Management
• Information Sharing

Together, these pillars form the foundation of DORA compliance. This guide explores incident reporting in detail, providing actionable insights for compliance and operational resilience. 

📚 Related: The Digital Operational Resilience Act (DORA) - Regulation (EU) 2022/2554

What is Incident Reporting?

Incident reporting involves documenting and communicating ICT-related disruptions or security events that impact an organization’s operations, data, or customers.

Under DORA, organizations must adopt a standardized approach to detect, report, and respond to incidents, ensuring timely communication with regulatory authorities and internal stakeholders. This process is vital for mitigating risks and demonstrating accountability in the face of disruptions.

📚 Related: Official DORA Journal of the EU

DORA Compliance Requirements for Incident Reporting

DORA sets stringent requirements for incident reporting to ensure financial institutions are prepared to handle disruptions effectively. Key requirements include:

• Timely Detection: Organizations must establish systems to detect incidents promptly, minimizing their impact.
• Regulatory Notification: Significant incidents must be reported to authorities within defined timelines, with updates provided as new information becomes available.
• Comprehensive Documentation: All incidents, whether reported externally or not, must be documented, including their causes, impacts, and resolutions.
• Continuous Improvement: Organizations must use post-incident reviews to refine their incident response strategies and maintain compliance.

📚 Related: DORA Maturity Assessment

Core Elements of Incident Reporting under DORA

1. Incident Detection and Classification (Article 15)

The first step in incident reporting is promptly detecting and categorizing incidents based on their severity and potential impact. Effective detection ensures timely responses and reduces operational downtime.

Organizations achieve this by deploying advanced monitoring tools like SIEM systems, which provide continuous oversight of networks, applications, and infrastructure. For example, detecting an unusual spike in network traffic could signal a Distributed Denial of Service (DDoS) attack.

Once identified, incidents are classified based on predefined severity criteria, such as financial loss, service downtime, or data breaches. IT teams and compliance officers work together to ensure incidents are categorized appropriately, setting the stage for informed responses.

Key Activities:

• Implementing Detection Systems: IT teams deploy tools like SIEM platforms to monitor ICT environments and flag anomalies in real time. For example, a financial institution might use SIEM to identify unusual spikes in network traffic indicative of a DDoS attack.
• Defining Classification Criteria: Compliance officers work with IT teams to establish criteria for categorizing incidents, such as minor operational disruptions versus critical cybersecurity breaches.
• Training Staff: Regular training ensures employees can recognize potential incidents and follow escalation protocols.

The outcome is an efficient detection and classification system that enables organizations to respond swiftly to incidents, prioritize resources effectively, and ensure alignment with DORA reporting thresholds.

2. Escalation Protocols (Article 16)

Once an incident is detected, it must be escalated through predefined protocols to ensure appropriate stakeholders are notified and involved.

Escalation begins with frontline IT staff, who initiate the process by notifying risk management teams or incident response coordinators. Tools like SAP Signavio can automate workflows, ensuring that notifications reach the right individuals at the right time. For instance, a detected malware infection might trigger an automatic alert to the CISO, compliance officers, and legal teams. Regular drills and simulations help refine escalation protocols and improve team readiness.

Key Activities:

• Creating Escalation Workflows: Organizations use tools like SAP Signavio to design workflows that guide escalation steps, ensuring incidents reach the right personnel promptly.
• Defining Roles and Responsibilities: Compliance officers, IT leaders, and senior management must have clearly defined roles in the escalation process. For instance, a cybersecurity manager may lead technical remediation efforts, while compliance teams handle regulatory reporting.
• Testing Escalation Protocols: Regularly simulated incidents, such as phishing attacks, can validate the effectiveness of escalation workflows and identify areas for improvement.

The outcome is a streamlined escalation process that minimizes response times, ensures clear accountability, and positions organizations to handle incidents effectively and in compliance with regulatory expectations.

3. Incident Reporting to Authorities (Article 17)

DORA mandates timely reporting of significant incidents to regulatory authorities, ensuring transparency and accountability.

Incident reporting involves documenting key details, including the nature of the incident, its impact, root cause, and mitigation steps. Organizations must use standardized templates to ensure consistency and comprehensiveness. For example, a ransomware attack affecting customer accounts might require a detailed report within 24 hours of detection, with follow-up updates as additional information becomes available. Regulatory reporting tools streamline this process by automating the generation and submission of reports.

Key Activities:

• Identifying Reportable Incidents: Compliance teams assess incidents against DORA’s thresholds for reportability, such as significant financial losses or data breaches affecting large customer bases.
• Automating Reporting Mechanisms: Tools like SAP Signavio streamline the creation and submission of incident reports to regulators within required timeframes. For example, a major ICT outage might require a detailed incident report within 24 hours.
• Maintaining Reporting Templates: Standardized templates ensure all required details, such as incident type, impact, and resolution steps, are included in reports.

The outcome is timely and accurate communication with regulators, demonstrating accountability and fostering trust while aligning with DORA’s compliance standards.

4. Post-Incident Analysis and Improvement (Article 17)

After an incident is resolved, organizations must conduct thorough analyses to identify root causes and implement preventive measures.

Post-incident reviews involve collaboration between IT teams, risk managers, and compliance officers. These teams analyze incident timelines, identify gaps in response efforts, and recommend improvements to policies, technologies, or processes. For example, a delayed response to a phishing attack might reveal the need for improved employee training or enhanced email filtering systems. Findings are documented and shared with relevant stakeholders, including regulators, to demonstrate commitment to continuous improvement.

Key Activities:

• Conducting Root Cause Analysis: IT teams collaborate with risk managers to identify the factors leading to an incident. For example, an analysis of a ransomware attack may reveal gaps in employee training or outdated software.
• Documenting Lessons Learned: Compliance officers compile findings into reports to inform future risk mitigation strategies and regulatory audits.
• Updating Policies and Controls: Based on findings, organizations revise incident response policies, enhance detection systems, or implement additional security measures.

The outcome is a stronger incident response framework that evolves based on real-world experiences, reducing vulnerabilities and building long-term resilience.

Incident Reporting Tools and Technologies

• Monitoring Tools (e.g., SIEM Systems): Provide real-time detection and alerting for ICT anomalies, enabling early identification of potential incidents.
• Process Automation Tools (e.g., SAP Signavio): Streamline escalation workflows and automate regulatory reporting, ensuring consistency and compliance with DORA timelines.
• Incident Response Platforms: Coordinate technical remediation efforts and facilitate communication among stakeholders during incidents.
• Forensic Analysis Tools: Support root cause analysis by identifying the origin and progression of incidents, helping organizations prevent recurrence. 

📚 Related: The Role of Enterprise Architecture in DORA Compliance

Most Common Challenges

1. Inconsistent Incident Classification: Without standardized criteria, organizations may struggle to determine which incidents require escalation or reporting. 
   Solution: Develop clear classification guidelines aligned with DORA thresholds to ensure consistency.
   
   
2. Delayed Detection and Reporting: A lack of real-time monitoring tools can delay incident detection, increasing impact severity. 
   Solution: Implement SIEM systems to monitor ICT environments continuously and alert teams to potential issues.
   
   
3. Siloed Communication: Poor coordination between IT, compliance, and risk teams can hinder incident resolution. 
   Solution: Use process automation tools to centralize workflows and facilitate cross-departmental collaboration.
   
   
4. Regulatory Complexity: Understanding and meeting reporting requirements can be challenging, especially for organizations operating in multiple jurisdictions. 
   Solution: Leverage templates and compliance tools to simplify reporting and ensure adherence to DORA standards. 

Best Practices

• Establish Clear Reporting Protocols: Define workflows that guide incident detection, escalation, and reporting processes, ensuring consistency across the organization.
• Automate Where Possible: Use tools like SAP Signavio to automate reporting workflows, reducing manual effort and ensuring timely regulatory submissions.
• Foster a Culture of Preparedness: Regularly train employees on incident detection and reporting protocols to enhance organizational readiness.
• Leverage Advanced Monitoring Systems: Deploy SIEM platforms to provide real-time visibility into ICT environments, enabling proactive incident management.
• Continuously Refine Protocols: Use post-incident reviews to identify areas for improvement and update protocols accordingly, ensuring they remain effective against evolving threats. 

Incident reporting is an integral component of DORA compliance, ensuring organizations can detect, respond to, and communicate ICT-related disruptions effectively.

By adopting a structured approach to incident reporting, leveraging advanced tools, and fostering cross-departmental collaboration, financial institutions can maintain resilience, transparency, and regulatory alignment.