Your choice of a Third Party Risk Management Software should be based on your organization’s regulatory requirements, acceptable level of risk, use of third-parties, business processes, joint ventures, compliance requirements and overall enterprise risk management strategy.

Organizations are now leveraging third-parties directly in their supply chain, as well as auxiliary services like sales, distribution and support. The increasing use of technology, like cloud and cloud-based applications, is further accelerating the trend toward outsourcing and increasing associated risks.

Further, the value of the tasks being executed by third-parties is increasing, increasing the impact of disruption or failure of third-party vendors.

Third-party risk is a feature on board agendas with CEO/board-level responsibility in many organizations especially those operating in regulated environments. Visits to third-party locations are becoming more common to gain assurance over third-party management.

As businesses become more decentralized, there is increasing need for consistent Third Party Risk Management Software. Best-in-class organizations are leveraging third-parties extensively while effectively managing the risks associated.

What are the best practices for a third-party risk management framework?

Both the National Institute of Standards and Technology (NIST) and International Organization for Standardization (ISO) have popular Third Party Risk Management Software that can be used together in the assessment process of any third-party risk management program.

In general, best practices for any Third Party Risk Management Software are to:

  1. Take inventory of all third-party vendors your organization has a relationship with
  2. Catalog cybersecurity risks that the counterparties can expose your organization to
  3. Assess and segment vendors by potential risks and mitigate risks that are above your organization’s risk appetite
  4. Develop a rule-based system to assess future vendors and set a minimum acceptable hurdle for the quality of any future third-parties in real-time by reviewing data security and independent reviews
  5. Establish an owner of vendor risk management and all other third-party risk management practices
  6. Define three lines of defense including leadership, vendor management and internal audit
  7. The first line of defense – functions that own and manage risk
  8. The second line of defense – functions that oversee or specialize in risk management and compliance
  9. The third line of defense – functions that provide independent assurance, above all internal audit
  10. Establish contingency plans for when a third-party is deemed below quality or a data breach occurs

Establishing a Third Party Risk Management Software means the financial and reputational damage to your organization will be minimize if a third-party data breach does occur. Data breaches can have massive impacts on your customers, employees and the position of your organization in the market.

Properly managing cyber security reduces the impact and cost of risk management without impacting the overall productivity and ability to onboard third-parties to an organization.

Third Party Risk Management Software provide your organization with shared standards for decision-making, minimizing the hassle and time it takes to manage third-party vendor risk. Ultimately saving your organization money and more importantly, its reputation and relationship with its customers.

How to manage third-party vendor risks in 2021

Managing third-party relationships can be a big task. As a result, many organizations have opted to use intelligent tools that use first and third-party data to monitor cybersecurity risk and to improve the overall security posture of an organization.

Third Party Risk Management Software customers automatically monitor their vendors security performance over time and benchmark them against the industry.

Each vendor is rated against over 50 criteria providing a daily Cyber Security Rating. We can automatically send vendor security questionnaires to help you gain deeper insights into your vendors, improve your coverage and scale your security team.

We also continuously scan for and discover data exposures and leak credentials related to any part of your business, preventing reputational and regulatory harm.