When you are deciding to create a framework for your Third-Party Risk Management Program you need to take the following into consideration:
- How are you going to categorize your third-parties?
- How would you rank your third-parties?
- What is the criteria/requirement for each one of those categories?
Other areas to consider involve the people component of the workflow, such as business owners, legal, and procurement. Especially during the contracting phase, by including legal language that assessments and/or assurance programs must be provided. Also, include stipulations regarding renewals that reassessments are required.
And of course, there is technology, the enabler. Technology provides the automation and a structured way to capture specific data for business and executives to make key decisions on these relationships. Monitoring these data points will contribute to the success or failure of that third-party and of the third-party risk program itself.
What are the benefits to having a Third-Party Risk Management program in place?
- Consistency in rating the the security posture of third-parties
- Create operational efficiencies, lower cost and defragment the overall third-party risk management process
- Ensure that third-party relationships adhere and comply with contractual commitments
- Access to data to make informed decisions on those third-party relationships
Looking into the future
Perhaps, organizations will rely less on questionnaires, and more on certification, audits and insurance. These require more rigorous review of a third-party’s information and security controls. We may even see more proactive due diligence where organizations will visit third-party locations to have them attest to their policies and controls.
And there is the global factor – we may see more additional data protection and privacy compliance regulations. As third-parties become global in nature, where data lives and how it is accessed becomes more critical. A good example is GDPR. Any transfer of personal data outside the EU and EEA will need to be GDPR compliant. Controllers of data must put in place technical and organizational measures to implement the data protection principles.
If you are interested in learning more about our third-party risk platform please click here.[/vc_column_text][/vc_column][/vc_row]