Awareness of Third-party Risks - RiskWatch

Awareness of Third-party Risks

third-party contract review

Awareness of Third-party Risks

Third-party risk is quickly becoming a primary concern for many organizations as the utilization of outside resources continues to increase. These organizations are operating in a complex ecosystem that connects data and systems, increasing risk on many fronts. These third parties gain access to employee data, customer data, financial information, operations intel, and more that is potentially accessible through systems.

Software, services, and suppliers are examples of third-party involvement that carries the appeal of cost savings and competitive advantage. Despite these benefits, they add a lot of work for your risk management teams. In addition to your own risk profile, your business is responsible for any risk-related action or inaction by everyone in your third-party network. While many reasonably expect their third parties to manage their own risk, this, unfortunately, does not always happen, making it extremely important to perform third-party risks assessments and ensure your organization is protected in the process.

Third-party Risks

According to a study performed by MasterCard’s RiskRecon and the Cyentia Institute, about 30% of organizations said their vendors would pose a risk to their operations if they were breached. Another quarter said around 50% of third-party vendors could have a severe impact on their organization if an attack was successful.

Examples of risks through third parties include:

Network Breach – any unauthorized activity on your organization’s digital network, jeopardizing network security and data.

Reputational Risk – negative public opinion gained by association, resulting from publicized security breaches, poor work practices, legal violations, or harmful customer interactions.

Intellectual Property Theft – robbing an individual or organization of their ideas, inventions, or creative expressions. IP typically includes trade secrets and proprietary information, including patents, trademarks, and copyrights.

Spear Phishing – targeting specific organizations or individuals in an attempt to steal sensitive information such as account credentials or financial information, often by sending counterfeit messages impersonating a legitimate person or organization.

Operational Risk – the possibility of a third-party action that causes an interruption to business operations or a full operational shutdown.

Data Theft – the unauthorized copying or transferring of an individual’s or an organization’s data from a computer or server.

Credential Theft – attempting to steal an individual’s passwords or login information with the intent to access private or secure data and information.

Fileless Malware – a type of malicious software that uses legitimate programs to infect a host rather than virus-laden files

Continuous Third-party Monitoring

Performing a single risk assessment on your third parties once a year may check off compliance obligations but it does not position your company to best manage the multitude of risk they generate. This process is also very difficult to manage with a manual process, requiring costly visits to third-party sites that only offer a glimpse of a single point in time. Otherwise, you’re relying on the third party’s word. Improving risk management of your external parties requires consistent visibility that offers insight on remedial task progress, overall level of compliance, company policies, and more. Monitoring these key areas will also prove invaluable as you work to improve your own internal risk management process as well.

Take Corrective Action

For an in-depth explanation of any of the risks above, utilize RiskWatch expertise. We will guide you through assessing any relevant risks and creating action plans to start engaging all of your third parties. With our prebuilt content libraries and streamlined methodology, you’ll easily be able to follow along as third parties complete assessments, implement changes, and prioritize their biggest vulnerabilities. Auto analysis and reporting in the platform makes management easy, so you can spend less time following up. Overall, organizations can better manage their third-party risk, increase visibility, and improve the quality of vendor and supplier networks with the RiskWatch platform.

For a self-managed assessment process, our platform enables your third parties to submit their own data through a custom portal – just send them a link and they can submit all required information within a set timeframe. If your third party does not submit the requested information by set dates, escalation automatically occurs in the system, sending reminders to relevant personnel. From there, the platform automatically analyzes data collected, giving a real time risk and compliance score, and suggesting tasks to mitigate risk. Automatic reports are also generated with any selected data, making your findings ready to present at a moment’s notice.

For a free consultation on any third-party risks or to take a free trial of our risk management platform, click the link below.