What Are Policies? Governance and Compliance Framework

Introduction - What Is a Policy?

A Policy in Catalio is an organizational governance rule that defines constraints, standards, and guidelines for your requirements and development processes. While requirements describe what to build, policies establish what’s allowed and how it must be done.

Think of policies as the guardrails that keep your projects aligned with:

Regulatory compliance (GDPR, SOX, HIPAA, PCI-DSS)
Security standards (data encryption, access control, authentication)
Business rules (budget approval, stakeholder sign-off)
Technical standards (API design, architecture patterns, code quality)

Policies vs. Requirements: The Key Distinction

Aspect	Policies	Requirements
Purpose	Define constraints and standards	Define features and capabilities
Scope	Apply across multiple requirements	Describe specific functionality
Lifecycle	Reviewed periodically (yearly/quarterly)	Evolve with product development
Enforcement	Mandatory/Recommended/Optional levels	Implemented or not implemented
Examples	“All user data must be encrypted at rest”	“Build a user profile page with avatar upload”

Example: Your organization might have a Security Policy stating “All authentication must use multi-factor authentication (MFA).” This policy would then be linked to multiple requirements for login flows, API endpoints, and admin panels, ensuring consistent security standards across all features.

Why Policies Matter

Policies serve as the foundation for governance, compliance, and risk management across your entire SDLC workflow.

1. Regulatory Compliance

Modern businesses operate under complex regulatory frameworks. Policies help you:

Track compliance obligations across your requirement portfolio
Generate audit trails showing which requirements comply with regulations
Identify gaps where requirements lack necessary policy coverage
Demonstrate due diligence to auditors and regulators

Real-World Example: A healthcare company must comply with HIPAA. They create a “HIPAA Data Privacy Policy” and link it to all requirements that handle protected health information (PHI). During audits, they can instantly show which features comply with HIPAA standards.

2. Risk Management

Policies help you assess and manage project risks:

Security risks: Policies enforce encryption, authentication, and access control standards
Financial risks: Budget approval policies prevent cost overruns
Operational risks: Quality standards ensure reliability
Reputational risks: Privacy policies protect customer data

3. Architectural Consistency

Technical policies ensure your platform remains maintainable and scalable:

API design standards prevent fragmented integration patterns
Code quality policies maintain codebase health
Performance benchmarks ensure acceptable user experience
Technology stack policies prevent technology sprawl

4. Business Rule Enforcement

Business rule policies align development with strategic goals:

Approval workflows ensure stakeholder buy-in
Prioritization policies allocate resources effectively
Legal constraints protect intellectual property
Vendor policies manage third-party dependencies

5. Streamlined Audits and Compliance Reporting

When audit time comes, policies provide:

Complete traceability from requirements to compliance obligations
Gap analysis reports showing uncovered requirements
Rationale documentation explaining why policies apply
Historical tracking through audit trails

Policy Types Explained

Catalio supports four policy types, each serving distinct governance needs:

1. Security Policies

Purpose: Protect your organization’s data, systems, and customers from security threats.

Common Examples:

Data encryption at rest and in transit
Password complexity requirements
Multi-factor authentication (MFA) requirements
Access control and role-based permissions
Security patching and vulnerability management
API authentication and authorization standards

Example Security Policy:

**Policy Name:** Data Encryption Standards

**Policy Content:** All user data classified as PII (Personally Identifiable Information) must be:

1. Encrypted at rest using AES-256 encryption
2. Encrypted in transit using TLS 1.3 or higher
3. Stored with encryption keys managed through a certified key management service
4. Subject to regular encryption audits (quarterly)

This policy applies to all customer data, employee records, and financial information.

Linked Requirements: User registration, payment processing, profile management, employee onboarding

2. Compliance Policies

Purpose: Ensure your organization meets regulatory and legal obligations.

Common Examples:

GDPR (General Data Protection Regulation) for EU data privacy
SOX (Sarbanes-Oxley) for financial controls
HIPAA (Health Insurance Portability and Accountability Act) for healthcare data
PCI-DSS (Payment Card Industry Data Security Standard) for payment processing
CCPA (California Consumer Privacy Act) for California residents
ISO 27001 for information security management

Example Compliance Policy:

**Policy Name:** GDPR Data Subject Rights

**Policy Content:** All features handling EU resident data must support:

1. Right to access: Users can download all their personal data
2. Right to erasure: Users can request complete data deletion
3. Right to rectification: Users can correct inaccurate data
4. Right to data portability: Data provided in machine-readable format
5. Consent management: Explicit opt-in for data processing

Compliance deadline: Must implement within 30 days of user request.

Linked Requirements: User account management, data export feature, account deletion workflow, consent management UI

3. Business Rule Policies

Purpose: Enforce internal business constraints, approval workflows, and strategic alignment.

Common Examples:

Budget approval thresholds
Stakeholder sign-off requirements
Legal review for customer-facing features
Marketing approval for messaging
Vendor evaluation criteria
Priority scoring methodology

Example Business Rule Policy:

**Policy Name:** New Feature Budget Approval

**Policy Content:** Any requirement with estimated development cost >$10,000 must:

1. Include detailed cost-benefit analysis
2. Obtain CFO approval before sprint planning
3. Have quarterly budget review checkpoints
4. Track actual vs. estimated costs
5. Require sign-off from product VP for cost overruns >20%

This policy ensures financial discipline and prevents budget surprises.

Linked Requirements: Major feature development, infrastructure upgrades, third-party integrations

4. Technical Policies

Purpose: Maintain architectural consistency, code quality, and technical standards.

Common Examples:

RESTful API design standards
Database schema conventions
Code review requirements
Testing coverage thresholds (e.g., >80% coverage)
Performance benchmarks (e.g., <200ms API response time)
Technology stack approval process
Documentation standards

Example Technical Policy:

**Policy Name:** RESTful API Design Standards

**Policy Content:** All public APIs must follow these conventions:

1. Use proper HTTP methods (GET, POST, PUT, DELETE, PATCH)
2. Return standard HTTP status codes (200, 201, 400, 404, 500)
3. Use JSON for request and response bodies
4. Implement pagination for list endpoints
5. Include OpenAPI (Swagger) documentation
6. Version using URL path versioning (e.g., /api/v1/resource)
7. Implement rate limiting (1000 requests/hour per user)
8. Require authentication via Bearer tokens

Non-compliance blocks deployment to production.

Linked Requirements: All API endpoint requirements, backend service development, mobile app integration

Enforcement Levels

Each policy has an enforcement level that determines how strictly it must be followed and what happens when requirements don’t comply.

1. Mandatory (Default)

When to Use:

Regulatory compliance requirements (GDPR, SOX, HIPAA)
Critical security standards (encryption, authentication)
Legal obligations (data privacy, accessibility)
Financial controls (budget approval, audit trails)

Impact:

Requirements violating mandatory policies cannot be approved until compliance is addressed
Acts as a quality gate in your approval workflow
Generates compliance tracking reports
Auditable trail of enforcement

Example:

Policy: "All payment processing must be PCI-DSS compliant" Enforcement: Mandatory Result: Payment
feature requirements blocked until PCI-DSS compliance demonstrated

2. Recommended

When to Use:

Best practices that improve quality but aren’t critical
Architectural preferences that allow exceptions
Performance guidelines with acceptable trade-offs
Emerging standards being phased in

Impact:

Requirements violating recommended policies generate warnings but can proceed
Tracks policy adherence rates for continuous improvement
Allows justified exceptions with documented rationale
Encourages compliance without blocking progress

Example:

Policy: "All features should achieve <200ms API response time" Enforcement: Recommended Result:
Complex reporting feature with 300ms response time generates warning, team documents rationale
(acceptable trade-off for data accuracy), proceeds

3. Optional

When to Use:

Reference documentation and guidelines
Nice-to-have improvements
Experimental approaches being evaluated
Context-dependent recommendations

Impact:

No enforcement mechanism
Available for reference and guidance
Useful for knowledge sharing
Can be linked to requirements for context

Example:

Policy: "Consider implementing GraphQL for flexible data fetching" Enforcement: Optional Result:
Linked to API requirements for team awareness, no compliance required

Choosing the Right Enforcement Level: Decision Tree

Start: Does this policy relate to...

├─ Legal/Regulatory requirement? → MANDATORY
├─ Critical security standard? → MANDATORY
├─ Financial control or audit requirement? → MANDATORY
├─ Business-critical quality standard? → MANDATORY
│
├─ Architectural best practice with rare exceptions? → RECOMMENDED
├─ Performance guideline with trade-offs? → RECOMMENDED
├─ Emerging standard being adopted gradually? → RECOMMENDED
│
└─ Reference information or context? → OPTIONAL
└─ Experimental approach? → OPTIONAL

Policy Attributes Deep Dive

Core Attributes

Name

Purpose: Clear, descriptive identifier for the policy Best Practices:

✅ Be specific: “GDPR Data Subject Rights” not “Privacy Policy”
✅ Include scope: “RESTful API Design Standards” not “API Policy”
✅ Use consistent naming: “[Domain] [Type] [Focus]”
❌ Avoid vague names: “Security Stuff”, “Compliance Things”

Description

Purpose: Brief summary of policy purpose and scope Best Practices:

✅ 1-2 sentences explaining what and why
✅ Include who this affects (all requirements, specific domains)
✅ Mention enforcement level if not obvious
❌ Don’t duplicate policy content here

Example:

Description: "Ensures all payment processing complies with PCI-DSS standards
to maintain our merchant account and protect customer financial data.
Applies to all requirements handling credit card information."

Policy Content

Purpose: Detailed rules, guidelines, and criteria for compliance Best Practices:

✅ Use numbered lists for clear criteria
✅ Include specific thresholds and metrics
✅ Reference authoritative sources (regulations, standards)
✅ Provide compliance examples
✅ Specify who is responsible for enforcement
❌ Don’t be vague or open to interpretation

Example of Good Policy Content:

## Requirements:

1. All passwords must be at least 12 characters
2. Must include: uppercase, lowercase, number, special character
3. Password history: Cannot reuse last 10 passwords
4. Password expiry: Force reset every 90 days
5. Failed attempts: Lock account after 5 failed attempts
6. MFA required for privileged accounts

## Compliance Check:

- Authentication implementation must pass penetration testing
- Password policy enforced at application and database layers
- Audit logs track all authentication events

## References:

- NIST SP 800-63B Digital Identity Guidelines
- OWASP Authentication Cheat Sheet

Lifecycle Management Attributes

Effective Date

Purpose: When policy becomes active and enforceable Use Cases:

Schedule policy activation for future date
Align with regulatory deadlines (e.g., “GDPR effective May 25, 2018”)
Phase in new standards gradually
Track historical policy changes

Example:

Policy: "TLS 1.3 Encryption Required"
Effective Date: 2025-06-01
Rationale: Allow 6-month transition period for teams to upgrade

Review Date

Purpose: Schedule next policy review to ensure relevance and accuracy Best Practices:

✅ Compliance policies: Review annually (or when regulations change)
✅ Security policies: Review quarterly (threat landscape evolves rapidly)
✅ Technical policies: Review semi-annually (technology changes quickly)
✅ Business rule policies: Review annually (or with strategic planning)
❌ Don’t set review dates and forget them - assign ownership

Example Review Schedule:

Policy Type: GDPR Compliance
Review Date: 2025-12-01 (annual review)
Next Review: 2026-12-01
Owner: Chief Privacy Officer

Accountability Attributes

Owner

Purpose: Designate who is responsible for policy maintenance and compliance Best Practices:

✅ Assign to role or department, not individual (reduces turnover impact)
✅ Match expertise: CISO for security, CFO for financial, CTO for technical
✅ Owner responsible for: policy updates, compliance monitoring, exceptions
❌ Don’t leave ownership blank - accountability matters

Common Ownership Models:

Security Policies → Chief Information Security Officer (CISO)
Compliance Policies → Chief Privacy Officer (CPO) or General Counsel
Business Rule Policies → Chief Financial Officer (CFO) or COO
Technical Policies → Chief Technology Officer (CTO) or VP Engineering

AI and Privacy Attributes

AI Accessible

Purpose: Control whether AI can analyze and process policy content Default: true (AI analysis enabled)

When to Disable AI Access:

Policy contains confidential strategic information
Policy includes sensitive legal advice
Policy references internal security mechanisms
Organization policy restricts AI analysis of governance documents

AI Capabilities (when enabled):

Generate policy summaries for quick understanding
Suggest relevant policies for new requirements (future)
Identify policy conflicts or redundancies (future)
Analyze compliance gaps across requirement portfolio (future)

AI Summary

Purpose: AI-generated concise summary of policy for quick reference Generated Automatically: When AI access is enabled and policy content is detailed

Example:

Policy Name: "GDPR Data Subject Rights"
Policy Content: [5 paragraphs detailing rights, obligations, timelines]

AI Summary: "Ensures EU residents can access, correct, delete, and export
their personal data within 30 days. Requires consent management and data
portability features for GDPR compliance."

AI Tags

Purpose: AI-generated categorization tags for policy discovery Use Cases:

Filter policies by topic: encryption, authentication, privacy
Search policies by regulatory framework: GDPR, HIPAA, SOX
Group policies by impact area: security, performance, usability

Linking Policies to Requirements

Policies become actionable when linked to specific requirements. This many-to-many relationship enables compliance tracking, gap analysis, and audit trails.

The RequirementPolicy Junction

When you link a policy to a requirement, Catalio creates a RequirementPolicy junction record that captures:

Which policy applies
Which requirement must comply
Why this policy is relevant (rationale field)
When the link was created (applied_at timestamp)

Writing Effective Rationale

The rationale field documents why a specific policy applies to a specific requirement. This is critical for:

Audits: Demonstrating thoughtful compliance consideration
Team understanding: New team members grasp policy relevance
Compliance reporting: Explaining policy applicability to regulators
Exception handling: Justifying when policies don’t apply

Good Rationale Examples

Example 1: Security Policy → Authentication Requirement

Policy: "Multi-Factor Authentication Required"
Requirement: "User Login via Email/Password"
Rationale: "This requirement handles user authentication and access to
sensitive account data. MFA is required to protect against credential theft
and unauthorized access. Implementing TOTP-based MFA (Google Authenticator,
Authy) will satisfy this policy."

Example 2: Compliance Policy → Data Export Requirement

Policy: "GDPR Data Subject Rights"
Requirement: "Export User Data to JSON"
Rationale: "GDPR Article 20 requires data portability, allowing users to
receive their personal data in a structured, commonly used, machine-readable
format. This requirement implements the data portability right by exporting
user profile, activity history, and preferences to JSON format."

Example 3: Technical Policy → API Requirement

Policy: "RESTful API Design Standards"
Requirement: "GET /api/v1/users Endpoint"
Rationale: "This endpoint follows RESTful conventions: uses GET method for
retrieval, includes versioning (/v1/), implements pagination with limit/offset,
returns 200 status with JSON response. Compliance verified through OpenAPI
documentation and integration tests."

Example 4: Business Rule Policy → Feature Requirement

Policy: "New Feature Budget Approval"
Requirement: "Advanced Analytics Dashboard"
Rationale: "Estimated development cost: $45,000 (12 weeks, 2 engineers).
Exceeds $10,000 threshold requiring CFO approval. Cost-benefit analysis shows
$200,000 annual revenue potential from enterprise customers. CFO approval
obtained 2024-12-15. Quarterly budget checkpoints scheduled."

Poor Rationale Examples (What to Avoid)

❌ Too Vague: “This policy applies because it’s a security requirement.”

Why bad: Doesn’t explain specific relevance or how to comply

❌ Copy-Paste Policy Text: “User data must be encrypted at rest using AES-256.”

Why bad: Repeats policy without explaining application to this requirement

❌ No Actionable Guidance: “Important for compliance.”

Why bad: Doesn’t help implementers understand what to do

❌ Missing Context: “Legal said we need this.”

Why bad: No explanation of which legal obligation or why it matters

When to Link Policies to Requirements

✅ Link Policies When:

Requirement handles data subject to regulatory compliance
Requirement implements security-sensitive functionality
Requirement incurs costs requiring approval
Requirement involves third-party integrations with vendor policies
Requirement affects system architecture or technical standards
Requirement impacts audit trails or compliance reporting

❌ Don’t Link Policies When:

Connection is tangential or unclear
Policy is too generic to provide value
Requirement is temporary or experimental
Link would create noise without adding compliance value

Bulk Linking Policies

For large requirement portfolios, you can link policies in bulk:

Example: New GDPR Policy Affecting 50 Requirements

Create “GDPR Data Subject Rights” policy
Filter requirements by tag: user-data, personal-information, account-management
Review each requirement for GDPR relevance
Bulk link with tailored rationale for each requirement category:
- Account management: “Implements right to erasure”
- Data export: “Implements right to data portability”
- Consent management: “Implements consent requirements”

Compliance Gap Analysis

One of the most powerful uses of policies is identifying compliance gaps: requirements that should have policy coverage but don’t.

Types of Compliance Gaps

1. Uncovered Requirements

Definition: Requirements that handle sensitive data or critical functionality but lack policy links

Example Scenario:

Policy: "PCI-DSS Payment Security"
Requirements with policy link:
  ✅ "Process Credit Card Payments"
  ✅ "Store Payment Methods"
  ✅ "Refund Transactions"

Requirements without policy link (GAPS):
  ⚠️ "Display Order History with Last 4 Digits"
     → Should link to PCI-DSS (displays card data)
  ⚠️ "Payment Method Deletion"
     → Should link to PCI-DSS (secure data disposal)

Action: Review gaps to determine if policy should apply, then link with rationale

2. Policy Violations

Definition: Requirements that violate mandatory policy rules

Example Scenario:

Policy: "API Response Time <200ms" (Recommended)
Requirement: "Generate Complex Financial Report API"
Current Implementation: 450ms response time
Status: Warning (recommended policy, acceptable with rationale)
Rationale: "Complex multi-table joins and financial calculations require 450ms.
            Caching strategy reduces subsequent calls to 50ms. Trade-off
            accepted for data accuracy."

3. Orphaned Policies

Definition: Policies with zero requirement links (potentially obsolete)

Example Scenario:

Policy: "Flash Player Support Required" (Created 2015)
Linked Requirements: 0
Action: Policy is obsolete (Flash deprecated). Archive or delete policy.

Running Compliance Reports

Monthly Compliance Dashboard:

Policy Coverage Rate: 87% of requirements have at least one policy link
Mandatory Policy Compliance: 100% (no violations blocking approval)
Recommended Policy Compliance: 78% (warnings documented with rationale)
Orphaned Policies: 3 policies have no links (review for archival)

Audit Preparation Report:

Policy: "GDPR Data Subject Rights"
Linked Requirements: 23
Status: 100% Compliant
Rationale Documented: 23/23 (100%)
Last Review: 2024-12-01
Next Review: 2025-12-01
Owner: Chief Privacy Officer

Evidence:
- All requirements implement required data subject rights
- Rationale documents GDPR article applicability
- Audit trail shows policy applied before development
- Testing confirms compliance implementation

AI-Powered Policy Features

Catalio’s AI capabilities enhance policy management and compliance tracking.

Current AI Features

1. AI Accessibility Controls

Default: AI analysis enabled (ai_accessible: true)
Opt-out: Disable for sensitive policies containing confidential information
Granular control: Set per policy based on sensitivity

2. AI-Generated Summaries

Purpose: Concise policy overviews for quick understanding

Example:

Policy: "SOX Financial Controls and Audit Trail Requirements"
Policy Content: [3 pages of detailed financial control procedures]

AI Summary: "Requires comprehensive audit trails for all financial
transactions, segregation of duties for payment approval, quarterly
reconciliation processes, and external auditor access to transaction logs.
Ensures Sarbanes-Oxley compliance for public company financial reporting."

Use Cases:

Quick policy overview in requirement review
Policy selection during requirement creation
Compliance dashboard summaries

3. AI-Generated Tags

Purpose: Automatic categorization for policy discovery

Example:

Policy: "HIPAA Protected Health Information Security"
AI Tags: ["healthcare", "privacy", "encryption", "access-control",
          "audit-trail", "HIPAA", "PHI", "security"]

Use Cases:

Filter policies by topic: Show all “encryption” policies
Search by framework: Find all “HIPAA” policies
Group by domain: List all “healthcare” policies

Future AI Features (Roadmap)

1. Automated Policy-Requirement Matching

Concept: AI suggests relevant policies when creating requirements

Example Scenario:

User creates requirement: "Build user profile page with photo upload"

AI suggests linking:
  → "Data Privacy Policy" (stores personal information)
  → "Image Upload Security Policy" (file upload vulnerability prevention)
  → "GDPR Data Subject Rights" (personal data processing)

User reviews suggestions, accepts/rejects, adds rationale

2. Policy Conflict Detection

Concept: AI identifies conflicting or redundant policies

Example Scenario:

Policy 1: "API response time must be <200ms" (Mandatory)
Policy 2: "API response time should be <500ms" (Recommended)

AI Warning: "Policy conflict detected - Policy 1 is more restrictive than
Policy 2. Consider removing redundant Policy 2 or clarifying scope."

3. Compliance Gap Analysis

Concept: AI identifies requirements likely to need policy coverage

Example Scenario:

AI Analysis: "5 requirements mention 'user data' or 'personal information'
but are not linked to GDPR Data Subject Rights policy. Review for potential
compliance gaps."

Suggested Requirements:
  → "User Email Verification" (processes personal data)
  → "Activity Log Display" (shows user behavior data)
  → "Account Deletion Workflow" (Right to Erasure)

4. Rationale Suggestions

Concept: AI drafts rationale text when linking policies to requirements

Example Scenario:

User links: "GDPR Data Subject Rights" → "Export User Data to CSV"

AI Suggested Rationale:
"This requirement implements GDPR Article 20 (Right to Data Portability) by
allowing users to export their personal data in a structured, machine-readable
format (CSV). The export includes profile information, activity history, and
preferences collected during platform use."

User edits and approves rationale

Policy Lifecycle Management

Creating New Policies

Step-by-Step Process:

Identify Need
- New regulation takes effect (e.g., GDPR, CCPA)
- Security incident reveals missing standards
- Audit finding requires policy documentation
- Strategic initiative requires governance
Define Policy Scope
- What does this policy constrain?
- Which requirements will it affect?
- What enforcement level is appropriate?
Draft Policy Content
- Research authoritative sources (regulations, standards, frameworks)
- Write clear, specific, actionable criteria
- Include compliance examples
- Specify enforcement mechanisms
Set Lifecycle Dates
- Effective Date: When policy becomes enforceable
- Review Date: When policy will be re-evaluated (typically 12 months)
Assign Owner
- Who is accountable for policy maintenance?
- Who approves exceptions?
- Who monitors compliance?
Create Policy in Catalio
- Fill in all metadata fields
- Set appropriate enforcement level
- Choose policy type (Security, Compliance, Business Rule, Technical)
- Enable/disable AI access based on sensitivity
Link to Relevant Requirements
- Identify existing requirements affected by policy
- Add policy link with clear rationale for each
- Update compliance tracking
Communicate Policy
- Notify affected teams
- Provide training if needed
- Update team documentation
- Set reminders for review date

Updating Policies

When to Update:

✅ Regulation changes (e.g., GDPR amendments)
✅ Security threat landscape evolves
✅ Business strategy shifts
✅ Technology standards advance (e.g., TLS 1.2 → TLS 1.3)
✅ Audit findings require policy refinement
✅ Exception patterns reveal policy is too strict/lenient

Update Process:

Document Change Rationale
- Why is update needed?
- What triggered the update?
- What changes specifically?
Review Impact
- Which requirements are affected?
- Do linked requirements remain compliant?
- Are new requirements now covered?
Update Policy Content
- Revise policy text with tracked changes
- Update effective date if enforcement changes
- Set new review date (typically +12 months)
Communicate Changes
- Notify owners of linked requirements
- Highlight compliance implications
- Provide grace period if needed
Audit Trail
- Catalio automatically tracks changes via AshPaperTrail
- Version history shows who changed what and when
- Critical for compliance audits

Scheduling Policy Reviews

Review Frequency Recommendations:

Policy Type	Review Frequency	Rationale
Compliance	Annually (or when regulation changes)	Regulations evolve; must stay current
Security	Quarterly	Threat landscape changes rapidly
Technical	Semi-annually	Technology evolves quickly
Business Rule	Annually (or with strategic planning)	Business strategy shifts periodically

Review Checklist:

Is policy content still accurate and relevant?
Have regulations or standards changed?
Are enforcement levels still appropriate?
Are linked requirements still accurate?
Have any exceptions revealed policy flaws?
Should policy be merged with similar policies?
Should policy be archived (obsolete)?

Example Review Workflow:

Policy: "TLS 1.2 Encryption Required"
Last Review: 2024-01-15
Review Date: 2025-01-15

Review Findings:
- Industry best practice has moved to TLS 1.3
- TLS 1.2 still acceptable but TLS 1.3 offers better security
- Recommend updating policy to require TLS 1.3

Action: Update policy content, set 6-month grace period for migration
New Effective Date: 2025-07-15
New Review Date: 2026-01-15

Archiving Policies

When to Archive:

❌ Regulation is repealed or no longer applies
❌ Technology is deprecated (e.g., Flash Player, IE11)
❌ Business model changes make policy irrelevant
❌ Policy has been superseded by newer policy

Archive Process:

Verify Obsolescence
- Confirm policy is truly no longer needed
- Check if any requirements still rely on policy
- Consult with policy owner
Document Archive Rationale
- Why is policy being archived?
- What replaces it (if anything)?
- Effective date of archive
Unlink Requirements
- Remove policy links from active requirements
- Add comments explaining why policy no longer applies
- Link replacement policy if applicable
Archive (Soft Delete)
- Catalio uses soft delete (sets archived_at timestamp)
- Policy remains in database for audit trail
- Policy no longer appears in active policy lists
- Historical compliance reports still include archived policy

Example Archive Scenario:

Policy: "Internet Explorer 11 Compatibility Required"
Created: 2015-03-01
Archived: 2024-06-15
Rationale: "IE11 reached end-of-life 2022-06-15. No longer supported by
           Microsoft. All users have migrated to modern browsers. Policy
           is obsolete."
Linked Requirements: 0 (all IE11 requirements removed in 2023)

Best Practices

✅ Do’s

1. Use Clear, Specific Naming

✅ Good: "GDPR Data Subject Rights"
❌ Bad: "Privacy Stuff"

✅ Good: "RESTful API Design Standards v2.0"
❌ Bad: "API Policy"

2. Write Actionable Policy Content

✅ Good: "All passwords must: (1) be ≥12 characters, (2) include uppercase,
         lowercase, number, special character, (3) expire every 90 days"
❌ Bad: "Passwords should be secure"

3. Set Appropriate Enforcement Levels

✅ Good:
  - "PCI-DSS Compliance" → Mandatory (legal requirement)
  - "API Response <200ms" → Recommended (best practice with exceptions)
  - "Consider GraphQL" → Optional (experimental)

❌ Bad:
  - Everything set to Mandatory (too restrictive)
  - Everything set to Optional (no enforcement)

4. Document Clear Rationale for Links

✅ Good: "This requirement processes EU resident data. GDPR Article 17
         requires implementing Right to Erasure. User can delete account and
         all associated data within Account Settings > Delete Account."

❌ Bad: "GDPR applies here"

5. Assign Clear Ownership

✅ Good: "Owner: Chief Information Security Officer (CISO)"
✅ Good: "Owner: VP Engineering"

❌ Bad: "Owner: TBD"
❌ Bad: "Owner: John Smith" (person may leave, role is better)

6. Schedule Regular Reviews

✅ Good: Set review dates and stick to them
✅ Good: Align reviews with strategic planning cycles
✅ Good: Trigger reviews when regulations change

❌ Bad: Set review date once and forget

7. Keep Policies Focused

✅ Good: One policy per regulatory framework or standard
         "GDPR Data Subject Rights"
         "GDPR Data Breach Notification"
         "GDPR Consent Management"

❌ Bad: One massive "Privacy Mega Policy" covering everything

❌ Don’ts

1. Don’t Create Vague Policies

❌ Bad: "Security is important. All features should be secure."
Why: Not actionable, no specific criteria, impossible to verify compliance

2. Don’t Over-Engineer

❌ Bad: Creating 100 ultra-specific policies for every minor standard
Example: "Button Color Must Be #007BFF Policy"
Why: Creates noise, reduces policy value, makes maintenance nightmare

3. Don’t Forget Enforcement Levels

❌ Bad: Leaving enforcement level at default without thought
Why: Mandatory by default might block progress unnecessarily

4. Don’t Skip Rationale

❌ Bad: Linking policy to requirement without explanation
Why: Team doesn't understand compliance obligation, auditors see no justification

5. Don’t Ignore Review Dates

❌ Bad: Setting review date but never actually reviewing
Why: Outdated policies create compliance risk, team follows obsolete standards

6. Don’t Confuse Policies with Requirements

❌ Bad: Creating policy: "Build user profile page"
Why: That's a requirement (what to build), not a policy (constraint/standard)

✅ Good: Policy: "User profile pages must display privacy settings link"
         Requirement: "Build user profile page with avatar upload"

7. Don’t Create Duplicate Policies

❌ Bad: Multiple similar policies with overlapping scope
Example: "Data Encryption Policy", "Encryption Standards", "Data Security Encryption"
Why: Confusion about which policy applies, maintenance nightmare

✅ Good: Single comprehensive policy: "Data Encryption Standards"

Common Patterns and Real-World Examples

Example 1: Healthcare - HIPAA Compliance

Scenario: Healthcare SaaS platform must comply with HIPAA for patient data protection.

Policy Setup

**Policy Name:** HIPAA Protected Health Information (PHI) Security

**Policy Type:** Compliance

**Enforcement Level:** Mandatory

**Effective Date:** 2024-01-15

**Review Date:** 2025-01-15

**Owner:** Chief Privacy Officer

**Policy Content:** All features handling Protected Health Information (PHI) must:

1. **Access Controls:**
   - Role-based access control (RBAC) limiting PHI access to authorized users
   - Unique user identification and authentication
   - Automatic logoff after 15 minutes of inactivity

2. **Audit Trail:**
   - Log all PHI access events (who, what, when)
   - Audit logs retained for 7 years
   - Regular audit log review (quarterly)

3. **Encryption:**
   - PHI encrypted at rest (AES-256)
   - PHI encrypted in transit (TLS 1.3)
   - Encryption key management via certified KMS

4. **Data Integrity:**
   - Mechanism to corroborate PHI has not been altered or destroyed
   - Electronic signatures for data authenticity

5. **Transmission Security:**
   - Integrity controls for PHI transmission
   - Encryption for PHI sent over public networks

**References:**

- 45 CFR § 164.312 (HIPAA Security Rule)
- HHS HIPAA Security Guidance

Linked Requirements with Rationale

Requirement 1: “Patient Medical Records Dashboard”

Rationale: "Displays PHI including diagnoses, medications, and treatment
history. HIPAA §164.312(a)(1) requires access controls. Implements RBAC
ensuring only authorized providers view patient records. Audit trail logs
all record access events."

Requirement 2: “Secure Messaging Between Patients and Providers”

Rationale: "Transmits PHI via messages containing health information. HIPAA
§164.312(e)(1) requires transmission security. Implements end-to-end encryption
using TLS 1.3 for all message traffic. Messages encrypted at rest in database."

Requirement 3: “Patient Data Export to PDF”

Rationale: "HIPAA §164.312(c)(1) requires integrity controls. Export generates
digitally signed PDF with SHA-256 hash to verify document has not been altered.
Audit log records export events."

Compliance Dashboard:

Policy: HIPAA PHI Security
Linked Requirements: 47
Mandatory Policy Compliance: 100%
Last Audit: 2024-11-20 (Passed)
Next Review: 2025-01-15

Example 2: Fintech - SOX Financial Controls

Scenario: Payment processing platform must comply with Sarbanes-Oxley for financial reporting accuracy.

Policy Setup

**Policy Name:** SOX Financial Transaction Controls and Audit Trail

**Policy Type:** Compliance

**Enforcement Level:** Mandatory

**Effective Date:** 2024-03-01

**Review Date:** 2025-03-01

**Owner:** Chief Financial Officer

**Policy Content:** All features handling financial transactions must:

1. **Segregation of Duties:**
   - Transaction initiation and approval must be separate roles
   - No single user can initiate, approve, and reconcile transactions
   - System enforces role-based access control

2. **Comprehensive Audit Trail:**
   - All financial transactions logged with:
     - User ID, timestamp, transaction amount
     - Before/after values for updates
     - IP address and session ID
   - Audit logs immutable (write-once storage)
   - Logs retained for 7 years

3. **Authorization Controls:**
   - Transaction approval limits by role
   - Multi-level approval for transactions >$10,000
   - Documented approval workflow

4. **Reconciliation:**
   - Daily automated reconciliation of transactions
   - Exception reporting for discrepancies
   - Quarterly manual audit by external auditor

5. **Change Management:**
   - All code changes to financial systems reviewed by two developers
   - Production deployment requires CFO approval
   - Change log tracks all modifications

**References:**

- Sarbanes-Oxley Act Section 404 (Management Assessment of Internal Controls)
- PCAOB Auditing Standard No. 5

Linked Requirements with Rationale

Requirement 1: “Payment Processing API”

Rationale: "Processes customer payments and refunds (financial transactions).
SOX Section 404 requires segregation of duties and audit trails. API implements:
- Separate roles for payment initiation (Merchant) and approval (Finance Manager)
- Immutable audit log of all payment events stored in compliance database
- Automated reconciliation with bank statements (daily)"

Requirement 2: “Refund Approval Workflow”

Rationale: "Refunds are financial transactions requiring SOX controls.
Implements multi-level approval:
- Refunds <$1,000: Single manager approval
- Refunds $1,000-$10,000: Manager + Finance Director approval
- Refunds >$10,000: Manager + Finance Director + CFO approval
Audit trail tracks approval chain with timestamps."

Requirement 3: “Financial Reporting Dashboard”

Rationale: "Displays transaction volumes, revenue, refunds (SOX-relevant metrics).
Implements access controls limiting view to authorized finance team. Data sourced
from immutable audit logs ensuring accuracy. Quarterly reconciliation with
external auditor using this dashboard."

Example 3: SaaS Platform - RESTful API Standards

Scenario: Multi-tenant SaaS platform with public API needs consistent technical standards.

Policy Setup

**Policy Name:** RESTful API Design Standards v2.0

**Policy Type:** Technical

**Enforcement Level:** Recommended

**Effective Date:** 2024-06-01

**Review Date:** 2025-06-01

**Owner:** VP Engineering

**Policy Content:** All public-facing APIs must follow these conventions:

1. **HTTP Methods:**
   - GET: Retrieve resources (idempotent, cacheable)
   - POST: Create new resources
   - PUT: Full resource update
   - PATCH: Partial resource update
   - DELETE: Remove resources

2. **URL Structure:**
   - Use nouns, not verbs: `/users` not `/getUsers`
   - Plural resource names: `/users` not `/user`
   - Nested resources: `/users/123/orders`
   - Versioning: `/api/v1/resource`

3. **Status Codes:**
   - 200 OK: Successful GET/PUT/PATCH
   - 201 Created: Successful POST
   - 204 No Content: Successful DELETE
   - 400 Bad Request: Invalid input
   - 401 Unauthorized: Missing/invalid auth
   - 403 Forbidden: Insufficient permissions
   - 404 Not Found: Resource doesn't exist
   - 500 Internal Server Error: Server failure

4. **Request/Response Format:**
   - JSON for all request and response bodies
   - Use camelCase for JSON keys
   - Include meta objects for lists: `{ data: [], meta: { total, page } }`

5. **Pagination:**
   - Use limit/offset or cursor-based pagination
   - Default limit: 25 items
   - Max limit: 100 items
   - Include pagination links in response

6. **Authentication:**
   - Bearer token authentication via Authorization header
   - Tokens expire after 1 hour
   - Include token refresh endpoint

7. **Rate Limiting:**
   - 1000 requests/hour per user (burst: 100/minute)
   - Return 429 Too Many Requests when exceeded
   - Include rate limit headers: X-RateLimit-Limit, X-RateLimit-Remaining

8. **Documentation:**
   - OpenAPI 3.0 specification required
   - Interactive API docs via Swagger UI
   - Code examples for common operations

9. **Error Responses:**
   - Consistent error format: `{ error: { code, message, details } }`
   - Human-readable error messages
   - Include request ID for support

10. **Performance:**
    - Target: <200ms response time (p95)
    - Implement caching where appropriate
    - Use ETags for conditional requests

**Exceptions:** Complex reporting endpoints may exceed 200ms response time if properly documented
and cached. Document rationale in policy link.

Linked Requirements with Rationale

Requirement 1: “GET /api/v1/users - List Users”

Rationale: "Public API endpoint for user management. Follows RESTful standards:
- GET method for retrieval (idempotent, cacheable)
- Plural resource name (/users)
- Pagination: limit/offset with default 25, max 100
- Returns 200 OK with JSON response
- Rate limited: 1000/hour per user
- OpenAPI documentation: /docs/api/users
- Performance: 45ms p95 response time (within 200ms target)"

Requirement 2: “POST /api/v1/users - Create User”

Rationale: "User creation endpoint following RESTful conventions:
- POST method for resource creation
- Returns 201 Created with Location header
- JSON request body with camelCase keys
- Validation returns 400 Bad Request with detailed error
- Bearer token authentication required (401 if missing)
- Rate limited: 100 creates/hour per user (prevents abuse)
- OpenAPI documentation with code examples"

Requirement 3: “GET /api/v1/reports/revenue - Revenue Report”

Rationale: "Complex financial report endpoint. Partially complies with policy:
✅ Follows RESTful URL structure (/api/v1/...)
✅ Returns 200 OK with JSON
✅ Implements authentication and rate limiting
✅ Has OpenAPI documentation

⚠️ Exception: p95 response time is 380ms (exceeds 200ms target)

Rationale for Exception:
Report aggregates data from multiple tables (users, transactions, subscriptions)
across 12-month period. Requires complex SQL joins and financial calculations.
Caching strategy reduces subsequent requests to 50ms. Trade-off accepted for
data accuracy over speed. Reviewed and approved by VP Engineering."

Compliance Dashboard:

Policy: RESTful API Design Standards
Linked Requirements: 89 API endpoints
Recommended Policy Compliance: 96%
Exceptions Documented: 4 endpoints (complex reporting, acceptable trade-offs)
Average Response Time: 78ms (well within target)

Example 4: E-Commerce - PCI-DSS Payment Security

Scenario: E-commerce platform processes credit card payments, must comply with PCI-DSS.

Policy Setup

**Policy Name:** PCI-DSS Payment Card Security Standards

**Policy Type:** Compliance

**Enforcement Level:** Mandatory

**Effective Date:** 2024-01-01

**Review Date:** 2025-01-01 (or when PCI-DSS v4.0 requirements change)

**Owner:** Chief Information Security Officer (CISO)

**Policy Content:** All features handling payment card data must comply with PCI-DSS requirements:

1. **Cardholder Data Protection:**
   - Never store CVV/CVV2/CVC2 codes (3-4 digit security code)
   - Never store full magnetic stripe data
   - Store only truncated card number (first 6, last 4 digits)
   - Encrypt Primary Account Number (PAN) if stored

2. **Secure Transmission:**
   - TLS 1.2 or higher for card data transmission
   - Strong cryptography and security protocols
   - Never send PANs via unencrypted email

3. **Access Controls:**
   - Restrict access to cardholder data on business need-to-know
   - Unique ID assigned to each person with computer access
   - Multi-factor authentication for remote access to network

4. **Vulnerability Management:**
   - Use and regularly update anti-virus software
   - Develop and maintain secure systems and applications
   - Regular security testing and monitoring

5. **Tokenization:**
   - Use payment tokenization (Stripe, Braintree) instead of storing card data
   - Tokens replace PANs in application database
   - Tokens cannot be reverse-engineered to original PAN

6. **Audit Trail:**
   - Log all access to cardholder data
   - Track and monitor all network access
   - Regularly review logs and security events

**References:**

- PCI DSS v4.0 Requirements
- PCI Security Standards Council Documentation

Linked Requirements with Rationale

Requirement 1: “Checkout Payment Form”

Rationale: "Collects credit card information during checkout. PCI-DSS
Requirement 6.5 mandates secure coding practices. Implementation:
- Stripe.js tokenization: Card data never touches our servers
- Form hosted on Stripe-PCI-compliant iframe
- Only token returned to application (cannot be reverse-engineered)
- TLS 1.3 encryption for all transmission
- No storage of CVV, magnetic stripe data, or full PAN
Result: Reduces PCI-DSS scope (SAQ-A eligibility)"

Requirement 2: “Saved Payment Methods”

Rationale: "Allows users to save cards for future purchases. PCI-DSS
Requirement 3 governs stored cardholder data. Implementation:
- Store only Stripe tokens (not actual card data)
- Display last 4 digits and card brand (from token metadata)
- Encrypted token storage (AES-256)
- Access restricted to authenticated account owner
- Audit log tracks all payment method access
Result: Full PCI-DSS compliance without storing PANs"

Requirement 3: “Order History with Payment Details”

Rationale: "Displays past transactions including payment method. PCI-DSS
Requirement 3.3 limits displayed cardholder data. Implementation:
- Show only last 4 digits of card number (e.g., •••• 4242)
- Show card brand (Visa, Mastercard, Amex)
- Never display full PAN, CVV, or expiration date
- Access restricted to account owner via session authentication
- Audit log tracks order history views
Result: Compliant display minimizing cardholder data exposure"

Requirement 4: “Refund Processing”

Rationale: "Processes refunds to original payment method. PCI-DSS Requirement 8
governs access controls. Implementation:
- Refunds processed via Stripe API using original payment token
- No direct access to cardholder data
- Multi-factor authentication required for refund-authorized roles
- Segregation of duties: Customer service initiates, Finance Manager approves
- Comprehensive audit trail of all refund events
Result: Secure refund workflow with proper authorization controls"

Compliance Status:

Policy: PCI-DSS Payment Card Security
Linked Requirements: 12
Mandatory Policy Compliance: 100%
PCI-DSS SAQ Level: SAQ-A (lowest scope, tokenization-based)
Last Audit: 2024-10-15 (Passed)
Next Audit: 2025-10-15
Certified QSA: ABC Security Auditors

Organization-Scoped Policies

Policies in Catalio are organization-scoped, meaning each organization builds and maintains its own policy library. This supports multi-tenant isolation and allows organizations to customize governance to their specific needs.

Multi-Tenant Isolation

How It Works:

Each policy belongs to exactly one organization
Users can only view/edit policies in their own organization
Policy links (RequirementPolicy) enforce cross-tenant validation
Cannot link policies from one organization to requirements in another

Example:

Organization A (Healthcare Startup):
  - Policies: HIPAA PHI Security, SOC 2 Type II Controls, Data Retention Policy
  - Requirements: Patient Records, Telehealth Platform, Billing System

Organization B (FinTech Company):
  - Policies: PCI-DSS Payment Security, SOX Financial Controls, AML Compliance
  - Requirements: Payment Processing, Account Management, Transaction History

Organization A cannot see or link Organization B's policies (and vice versa)

Building Your Policy Library

Starter Policy Set (Recommended):

Every organization should start with these foundational policies:

Security Policies:
- Data Encryption Standards
- Password and Authentication Requirements
- Access Control and Authorization
Compliance Policies (Industry-Specific):
- Healthcare: HIPAA
- Finance: SOX, PCI-DSS
- SaaS: SOC 2, GDPR (if serving EU)
- All: Data Privacy (CCPA, GDPR)
Technical Policies:
- API Design Standards
- Code Review Requirements
- Testing and Quality Standards
- Performance Benchmarks
Business Rule Policies:
- Budget Approval Workflow
- Feature Prioritization Framework
- Vendor Evaluation Criteria
- Legal Review Process

Growing Your Policy Library:

Start with 5-10 core policies
Add policies as new regulations take effect
Create policies when audit findings reveal gaps
Refine policies based on team feedback
Consolidate redundant policies annually

Reusing Policies Across Requirements

One of the key benefits of policies is reusability: A single policy can be linked to many requirements, ensuring consistent governance without duplication.

Example: GDPR Policy Reuse

Policy: "GDPR Data Subject Rights" (Created once)

Linked to 23 Requirements:
  → User Registration
  → Account Settings
  → Profile Management
  → Activity Log
  → Data Export
  → Account Deletion
  → Email Preferences
  → Cookie Consent
  → Third-Party Integrations
  → Analytics Dashboard
  → Support Ticket System
  [... 12 more requirements]

Result: Single policy ensures consistent GDPR compliance across entire platform

Benefits:

✅ Consistent governance across requirements
✅ Single source of truth for compliance rules
✅ Easy to update policy once, affects all linked requirements
✅ Reduced duplication and maintenance burden
✅ Clear compliance coverage visibility

Policy Statistics and Insights

Requirements Count Aggregate: Every policy tracks how many requirements it’s linked to via the requirements_count aggregate.

Example Dashboard:

Policy: "GDPR Data Subject Rights"
Requirements Count: 23
Enforcement Level: Mandatory
Compliance Rate: 100%

Policy: "API Response Time <200ms"
Requirements Count: 89
Enforcement Level: Recommended
Compliance Rate: 96% (4 documented exceptions)

Policy: "SOX Financial Controls"
Requirements Count: 12
Enforcement Level: Mandatory
Compliance Rate: 100%
Last Audit: 2024-11-20 (Passed)

Use Cases:

Identify high-impact policies (linked to many requirements)
Find orphaned policies (zero links, potentially obsolete)
Measure compliance coverage across requirement portfolio
Prioritize policy reviews based on impact

Common Pitfalls to Avoid

1. Creating Requirements Disguised as Policies

Pitfall:

❌ Policy: "Build user profile page with avatar upload"
Why bad: This is a requirement (what to build), not a policy (constraint/standard)

Solution:

✅ Policy: "User-uploaded images must be scanned for malware before storage"
✅ Requirement: "Build user profile page with avatar upload"
Link: Policy constrains how requirement must be implemented

Rule of Thumb:

Requirements answer: “What feature should we build?”
Policies answer: “What constraints must features follow?”

2. Vague, Unactionable Policy Content

Pitfall:

❌ Policy: "Security is important. All features should be secure."
Why bad: No specific criteria, impossible to verify compliance

Solution:

✅ Policy Content:
All authentication features must:
1. Enforce password requirements: ≥12 characters, mixed case, numbers, symbols
2. Implement multi-factor authentication (TOTP or SMS)
3. Lock accounts after 5 failed login attempts
4. Force password reset every 90 days
5. Log all authentication events for audit trail

Compliance verified through: Security testing, code review, penetration testing

3. Over-Engineering with Too Many Policies

Pitfall:

❌ Creating 100 ultra-specific policies:
   - "Button Color Must Be #007BFF"
   - "Font Size Must Be 14px"
   - "API Endpoint Must Return 200 Status"
   - [... 97 more micro-policies]

Why bad: Creates noise, maintenance nightmare, reduces policy value

Solution:

✅ Create focused policies at appropriate abstraction level:
   - "UI Accessibility Standards" (covers colors, fonts, contrast ratios)
   - "RESTful API Design Standards" (covers status codes, methods, structure)

Keep policies at strategic level, not implementation details

4. Missing or Generic Rationale

Pitfall:

❌ Rationale: "This policy applies here."
❌ Rationale: "Compliance required."

Why bad: No explanation of specific applicability or how to comply

Solution:

✅ Rationale: "This requirement processes EU resident personal data (names,
emails, addresses). GDPR Article 17 requires implementing Right to Erasure.
User can request account deletion via Account Settings > Delete Account.
Deletion completes within 30 days, removes all personal data except legally
required transaction records (retained 7 years per tax law)."

5. Setting All Policies to Mandatory

Pitfall:

❌ All 50 policies set to Mandatory enforcement
Result: Team blocked on every requirement, development grinds to halt

Why bad: Treats all standards as equally critical, no room for justified exceptions

Solution:

✅ Use tiered enforcement:
   - Mandatory (10 policies): Legal requirements, critical security, audit obligations
   - Recommended (30 policies): Best practices, architectural standards, performance goals
   - Optional (10 policies): Experimental approaches, context-dependent guidance

Allows team velocity while ensuring compliance on critical policies

6. Forgetting Policy Reviews

Pitfall:

❌ Policy: "TLS 1.0 Encryption Required" (Created 2015, never reviewed)
Result: Outdated standard, TLS 1.0 now deprecated, organization at risk

Why bad: Policies become obsolete as technology and regulations evolve

Solution:

✅ Set review dates and honor them:
   - Compliance policies: Annual review (or when regulation changes)
   - Security policies: Quarterly review
   - Technical policies: Semi-annual review

Use calendar reminders, assign review ownership, track review completion

7. No Policy Ownership

Pitfall:

❌ Policy Owner: "TBD"
❌ Policy Owner: [blank]

Result: No one accountable for policy updates, exception approvals, compliance monitoring

Why bad: Policies become orphaned, team doesn't know who to ask about exceptions

Solution:

✅ Assign clear ownership:
   - Security policies → Chief Information Security Officer (CISO)
   - Compliance policies → Chief Privacy Officer (CPO) or General Counsel
   - Technical policies → Chief Technology Officer (CTO) or VP Engineering
   - Business rules → Chief Financial Officer (CFO) or COO

Owner responsibilities: Policy maintenance, exception approval, compliance oversight

8. Duplicate or Conflicting Policies

Pitfall:

❌ Policy 1: "API response time must be <200ms" (Mandatory)
❌ Policy 2: "API response time should be <500ms" (Recommended)

Result: Confusion about which policy applies, Policy 1 makes Policy 2 redundant

Why bad: Wastes time, creates ambiguity, complicates compliance tracking

Solution:

✅ Consolidate into single policy:
   - "API Performance Standards"
   - Target: <200ms response time (p95)
   - Acceptable: <500ms with documented rationale
   - Enforcement: Recommended (allows exceptions with justification)

Regular policy reviews identify and consolidate duplicates

9. Not Documenting Exceptions

Pitfall:

❌ Complex reporting endpoint violates "API <200ms" policy
❌ Team just ignores the policy violation
❌ No documentation of why exception is acceptable

Result: Compliance tracking shows violation, auditors question why, team can't explain

Why bad: Looks like non-compliance rather than justified exception

Solution:

✅ Document exceptions in rationale:
"Revenue Report API response time: 380ms (exceeds 200ms target). Exception
rationale: Report aggregates data from 5 tables across 12-month period requiring
complex SQL joins. Caching reduces subsequent requests to 50ms. Trade-off
accepted for data accuracy over speed. Reviewed and approved by VP Engineering
2024-11-15."

Result: Clear audit trail showing thoughtful exception handling

Integration with SDLC Workflow

Policies are most powerful when integrated into your Software Development Life Cycle workflow, acting as quality gates and governance checkpoints.

How Policies Guide Requirement Approval Workflows

Standard Approval Workflow Without Policies:

1. Requirement created
2. Product Manager reviews feasibility
3. Engineering estimates effort
4. Requirement approved and added to sprint

Enhanced Approval Workflow With Policies:

1. Requirement created
2. Relevant policies automatically suggested (or manually linked)
3. Compliance check:
   - Mandatory policies: Must be addressed before approval
   - Recommended policies: Warnings shown, can proceed with rationale
   - Optional policies: Linked for reference
4. Product Manager reviews feasibility + policy compliance
5. Engineering estimates effort + policy implementation impact
6. Requirement approved only if:
   ✅ All mandatory policies addressed
   ✅ Recommended policy warnings documented
   ✅ Technical feasibility confirmed
7. Requirement added to sprint with policy compliance criteria

Using Mandatory Policies as Quality Gates

Example: PCI-DSS Payment Security Gate

Requirement: "Implement Apple Pay Integration"

Linked Policy: "PCI-DSS Payment Card Security" (Mandatory)

Quality Gate Criteria:
[ ] Payment tokenization implemented (Stripe integration)
[ ] No storage of CVV, full PAN, or magnetic stripe data
[ ] TLS 1.3 encryption for all card data transmission
[ ] Access restricted to authorized payment processing roles
[ ] Audit trail logs all payment events
[ ] Security testing completed and passed

Result: Requirement cannot be approved until all criteria checked off

Benefits:

✅ Prevents non-compliant requirements from entering development
✅ Ensures policy considerations happen early (requirements phase, not testing phase)
✅ Creates audit trail showing compliance was considered from start
✅ Reduces rework by catching compliance issues before implementation

Compliance Checking During Requirement Validation

Automated Compliance Checks (Future Enhancement):

User creates requirement: "User Login via Social Media (Google, Facebook)"

AI suggests policy links:
  ⚠️ "OAuth 2.0 Security Standards" (Mandatory)
  ⚠️ "GDPR Data Subject Rights" (Mandatory - imports user data from third parties)
  ℹ️ "Third-Party Integration Standards" (Recommended)

Compliance Checklist Auto-Generated:
[ ] OAuth 2.0 implementation follows security best practices
[ ] User consent obtained for data import from Google/Facebook
[ ] Data minimization: Import only necessary user data
[ ] GDPR Article 20 compliance: Allow user to export/delete imported data
[ ] Third-party service agreements reviewed and approved

Result: Requirement shows policy compliance status before approval

Policy Review Cycles Aligned with Sprint Planning

Quarterly Policy Review Sprint:

Many organizations schedule quarterly policy reviews aligned with sprint planning:

Q1 Review Sprint (January):

Review all security policies (threat landscape evolves)
Check for new regulations taking effect in Q1
Update technical policies based on Q4 technology changes
Archive obsolete policies
Link new policies to relevant requirements

Example Q1 Review:

Policy: "TLS Encryption Standards"
Last Review: Q4 2024
Current Standard: TLS 1.2 minimum
Industry Trend: TLS 1.3 becoming standard

Q1 Review Decision:
- Update policy: TLS 1.3 required for new features (effective 2025-04-01)
- Grace period: TLS 1.2 acceptable for existing features until 2025-12-31
- Action: Link updated policy to all authentication/API requirements
- Notify engineering teams of upcoming migration

Next Review: Q2 2025 (or if major TLS vulnerability discovered)

Sprint Planning Integration:

Sprint 23 Planning (Q1 2025):
- Review requirements for upcoming sprint
- Check policy links for each requirement
- Identify policy compliance work required
- Estimate effort including policy compliance time
- Flag requirements needing exception approval

Example:
Requirement: "Implement Real-Time Chat Feature"
Linked Policies:
  → "TLS 1.3 Encryption" (Mandatory, effective 2025-04-01)
  → "GDPR Data Privacy" (Mandatory)
  → "Real-Time Performance <100ms" (Recommended)

Policy Impact on Sprint:
- +2 days for TLS 1.3 implementation (upgrade from 1.2)
- +1 day for GDPR consent flow for message data
- Performance target may be challenging for real-time, request recommended exception

Total Sprint Impact: +3 days, 1 exception request

Benefits:

✅ Policies reviewed regularly, stay current
✅ Policy changes communicated during sprint planning
✅ Team aware of compliance requirements before development starts
✅ Effort estimates include policy compliance work
✅ Prevents surprises during QA or production deployment

Policies work together with other Catalio concepts to provide comprehensive governance:

Requirements: Policies constrain requirements, ensuring they align with organizational standards
Processes: Policies can be linked to process steps, enforcing governance at each workflow stage
Organizations: Policies are organization-scoped, allowing multi-tenant policy libraries
Users: Policy owners are users responsible for policy maintenance and compliance

Getting Started with Your First Policy

Step-by-Step Guide:

Identify a Compliance Need
- Start with your industry’s primary regulation:
  - Healthcare: HIPAA
  - Finance: SOX or PCI-DSS
  - SaaS: GDPR, SOC 2
- Or start with a critical security standard: Data encryption, MFA
Research Authoritative Sources
- Read the regulation text (e.g., GDPR Article 17 for Right to Erasure)
- Review official guidance documents
- Check industry frameworks (NIST, ISO, OWASP)
- Consult with legal or compliance team
Draft Policy Content
- Write clear, specific, actionable criteria
- Include numbered requirements
- Reference authoritative sources
- Provide compliance examples
Create Policy in Catalio
- Navigate to Policies section
- Click “Create New Policy”
- Fill in metadata:
  - Name: “GDPR Data Subject Rights”
  - Policy Type: Compliance
  - Enforcement Level: Mandatory
  - Policy Content: [Your drafted criteria]
  - Effective Date: Today (or future date)
  - Review Date: 12 months from now
  - Owner: Chief Privacy Officer

Link to Relevant Requirements

Review existing requirements
Identify which requirements handle user data (GDPR-relevant)

Link policy to each requirement with clear rationale:

"This requirement collects and processes EU resident personal data.
GDPR Article 17 requires implementing Right to Erasure. User can
delete account and all data via Account Settings > Delete Account."

Verify Compliance
- Review linked requirements to ensure policy is addressed
- Generate compliance report
- Address any gaps
Schedule Review
- Set calendar reminder for review date
- Assign owner to review responsibility
- Document review process in team handbook

Advanced Policy Features (Coming Soon)

Roadmap:

Policy Templates: Pre-built templates for common regulations (GDPR, HIPAA, SOX)
Automated Policy-Requirement Matching: AI suggests policy links when creating requirements
Compliance Dashboard: Visual dashboard showing policy coverage, gaps, and violations
Policy Conflict Detection: AI identifies conflicting or redundant policies
Exception Workflow: Formal exception request and approval process for policy violations
Bulk Policy Linking: Link policies to multiple requirements simultaneously
Policy Impact Analysis: See which requirements would be affected by policy changes
Compliance Export: Generate compliance reports for auditors (PDF, CSV)

Support & Resources

Documentation Resources

Core Concepts:
- Requirements: Learn how requirements interact with policies
- Processes: Understand process-based policy enforcement
- Organizations: Multi-tenant policy management
Technical Guides (Coming Soon):
- API Documentation for policy management endpoints
- Integration Guide for third-party compliance tools
- Security Best Practices for policy enforcement

AI Assistant Integration

Catalio’s AI assistant can help with policy management:

Example Queries:

“Show me all requirements missing GDPR policy links”
“What policies should apply to this authentication requirement?”
“Generate compliance report for SOX audit”
“Suggest rationale for linking this policy to this requirement”

To Enable AI Assistance:

Ensure ai_accessible: true for policies (default)
Ask questions in natural language
Review AI suggestions before applying

Regulatory Compliance Support

Common Regulatory Frameworks:

GDPR: gdpr.eu - Official GDPR portal
HIPAA: hhs.gov/hipaa - HHS HIPAA guidance
SOX: pcaobus.org - Public Company Accounting Oversight Board
PCI-DSS: pcisecuritystandards.org - PCI Security Standards Council

Compliance Consulting:

For complex compliance questions, consult legal counsel
Consider hiring Qualified Security Assessor (QSA) for PCI-DSS
Engage external auditors for SOX, HIPAA compliance verification

Contact & Community

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Community Resources (Coming Soon):

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Document Version: 1.0 Last Updated: 2025-01-18 Next Review: 2026-01-18 Owner: Documentation Team