How does cloud computing impact IT governance?

Cloud computing changes how organizations approach IT governance by shifting responsibilities, altering risk management, and requiring new oversight mechanisms. In traditional on-premises setups, IT teams have full control over hardware, software, and data. With cloud services, some responsibilities—like physical security, server maintenance, and infrastructure updates—are transferred to the cloud provider. This shared responsibility model forces organizations to redefine governance policies to clarify which controls they manage (e.g., user access, data encryption) versus those handled by the provider (e.g., network uptime, patching). For example, AWS’s Shared Responsibility Model explicitly states that customers must configure identity and access management (IAM) roles properly, while AWS manages the underlying hypervisor security.

Compliance and regulatory adherence become more complex in the cloud. Data residency laws, such as GDPR in the EU, require organizations to know where data is stored and processed. Cloud providers often distribute data across global regions, which can create compliance gaps if not governed properly. Teams must configure cloud services to restrict data storage to compliant regions and audit configurations regularly. Tools like Azure Policy or AWS Config can automate compliance checks, but governance frameworks must define these rules upfront. Additionally, third-party audits (e.g., SOC 2 reports) from cloud providers help organizations meet compliance requirements, but internal governance must still validate these reports and map them to specific regulatory needs.

Cloud computing also impacts governance by accelerating development cycles, which can lead to uncontrolled resource sprawl. Developers can provision resources instantly via APIs, bypassing traditional approval workflows. Without governance guardrails, this can result in security vulnerabilities (e.g., publicly exposed storage buckets) or cost overruns. To address this, organizations implement infrastructure-as-code (IaC) tools like Terraform or AWS CloudFormation to enforce standardized, pre-approved configurations. For example, a governance policy might mandate that all cloud databases are private by default and tagged with owner details. Cost management tools like AWS Cost Explorer or Azure Cost Management also become critical for governance, ensuring budgets align with business goals and identifying unused resources for termination. These measures balance developer agility with organizational control.