The compliance crunch is here – and MSPs are perfectly placed to help solve it

Across the UK, organisations are facing an ever-heavier regulatory burden. Just last month, the UK government outlined the scope of the new Cyber Security and Resilience Bill, which is set to come into effect later this year. 

Specifically, the new Bill aims to strengthen the UK’s cyber defences and better protect critical national infrastructure from digital threats. However, achieving this will require more organisations to adhere to more stringent requirements. 

It’s the latest in a long line of expanding and evolving compliance obligations for UK organisations. Interestingly, tackling and reducing the legislative load has been on the government’s agenda for a decade. The Business Impact Target (BIT) was introduced back in 2015 with the aim of reducing the cumulative costs of regulation on business. However, figures from the UK Regulatory Policy Committee show that steps have consistently been taken in the wrong direction, year after year. 

Rather than falling, regulatory costs rose by £7.8 billion during the 2017-2019 parliament, and a further £14.3 billion in the first three years of the 2019-2024 parliament. As a result, most companies are currently feeling the strain. 

According to PwC’s Global Compliance Survey 2025, 85% of firms feel compliance requirements have become more complex in the last three years. 82% said that this rising complexity has negatively affected senior leadership focus, while 81% believe it has impacted their transformation and change activities.

A multi-billion dollar opportunity for MSPs

In the face of these challenges, many companies are naturally seeking support and solutions.

There is good reason why Gartner predicts that investments in governance, risk and compliance tools are expected to increase by 50% between 2023 and 2026. Businesses shouldering the weight of growing compliance demands are looking for ways to alleviate the burdens. 

For Managed Service Providers (MSPs), this presents a major opportunity. 

For many companies, external partners and experts will be the first port of call. At the same time, PwC’s survey shows that cybersecurity, data protection and privacy are among the leading priorities for companies when it comes to compliance – areas where MSPs are particularly well-positioned, thanks to their deep expertise and technical capabilities.

This presents a clear path for new revenue opportunities and service diversification. By adapting effectively and meeting the compliance needs of both new and existing customers as they evolve, MSPs will be able to grab a substantial piece of what is set to become a highly lucrative pie. 

According to one estimate, the global Compliance-as-a-service (CaaS) market is set to be valued at $19.51 billion in 2030, up from $5.51 billion in 2022.

Developing a relevant CaaS offering

Of course, this isn’t something that can be achieved overnight. To capitalise on the opportunities effectively, MSPs will need to build a relevant offering with careful consideration, potentially making significant operational and cultural changes in the process.

At present, many MSPs provide technologies and digital solutions – an approach that will only work in part when it comes to CaaS. Where compliance is concerned, organisations can’t simply overlay technologies within their existing operations. They also need to make operational changes that can have implications for people and processes.

MSPs will therefore need to ensure that their offerings account for this, providing the right combination of specialist support in addition to technologies to deliver the necessary results for clients.

Regarding the technology platforms themselves, MSPs must also consider several factors. Critically, it is important that any CaaS platform can integrate seamlessly with customers’ existing technologies and systems. If implementing a CaaS solution demands major infrastructure or operational overhauls, MSPs risk replacing one problem with another rather than truly solving their clients’ challenges.

Then there is the question of transparency. Clients will want visibility over their compliance status, with the ability to monitor and assess changes and progress. Therefore, any CaaS platform must incorporate key user experience-centric features such as dashboards and reports that make it easy for clients to ascertain need-to-know information.

Highlight non-compliance risks vs compliance rewards

Once an offering is in place – supported by the right methodologies and technologies—MSPs can begin taking their CaaS solutions to market.

To market any solution effectively, it’s essential to clearly demonstrate its value. In the case of CaaS, the most impactful approach is to highlight the contrast between the risks of non-compliance and the tangible benefits of achieving compliance.

Let’s paint this picture. 

For companies, non-compliance can lead to a variety of issues spanning everything from business disruption to productivity declines as well as fees and penalties. Further, the frequency of these impacts is increasing. 

According to ISMS.online research, more UK companies are now being fined between £250,000 and £500,000 (26% today versus 21% in 2023), while many more are being fined between £100,000 and £250,000 (35% versus 18%).

On the flip side, compliance can do much more than help companies avoid penalties. In fact, the same ISMS.online research shows that this is the primary motivation for less than one in five companies. Far more talk about the role that compliance plays in helping them to remain competitive (34%), increase customer demand (34%), protect business (30%) and customer (29%) information and enter new markets and supply chains (27%). 

This multitude of benefits is also reflected by the value that companies feel compliance offers. 

Some of the most significant returns from investing in compliance include an enhanced business reputation (34%), direct cost savings from a reduced number of cybersecurity incidents (30%), time savings from more efficient security processes (29%) and greater appeal to investors looking for low-risk companies (28%). Several other respondents also highlighted that compliance investments have enabled them to streamline their security infrastructure, making it easier and less costly to manage, while others said they’ve improved the quality of their business decisions.

Position CaaS as a long-term compliance strategy, not a quick fix

It’s important, however, not to oversell CaaS as a ‘set and forget’ miracle solution. 

MSPs must make it clear that while CaaS can help to reduce the burdens on companies in navigating various moving pieces of the legislative puzzle, compliance will still require ongoing and continuous management from the outset. 

The total cost of compliance for UK companies has been growing consistently, and that’s not expected to change anytime soon. Regulations both new and old will continue to emerge, evolve and change over time as new threats, challenges and opportunities arise. 

Businesses, therefore, need to keep a pulse on the regulatory landscape, one way or another, adapting their compliance strategies as necessary.

For MSPs, it is important to ensure clients are aware of this, as well as the need to maintain proper audit trails, which can showcase their effective compliance efforts should regulators come knocking. Not only will documenting key processes show that compliance is being achieved. Equally, it will also help in managing legal disputes.

MSPs must ensure their clients understand that the true value of CaaS lies not in offering a one-time fix, but in providing a sound framework from which ongoing compliance can be achieved more easily and effectively in a constantly shifting legislative environment.

Those that position their services transparently, emphasising the benefits and best practices, will be better placed to build trust, deliver maximum value and grow alongside clients as the regulatory landscape evolves.