How third party risk management can help solve your cyber security risks
By Sarah Shannon
As a business owner, you have a lot on your plate. You’re responsible for ensuring that your products or services are of the highest quality, that your employees are happy and productive, and that your customers are satisfied. Add on top of that you are dealing with the energy crisis, supply chain disruption and a looming recession. Then underlying all of those challenges, you have the ongoing worry about managing IT infrastructure, who hosts it, and of course what third parties have access to it and mitigating the risk of exposing your business to cyber threats. That’s why supplier management of third parties is of paramount importance.
Cyber security risk management is centered around identifying gaps, monitoring and managing the potential risk third parties pose to your business.
One of the most common IT problems faced by businesses today is the severity of data breaches. This can happen when a vendor does not have adequate security measures in place or when an employee of a vendor mishandles information and opens the back door to hackers. Data breaches can be devastating to a business, causing financial loss, damage to reputation, and loss of customer trust.
Here a just a few of the big names attacked by cyber criminals exposing sensitive data and causing serious business disruption and damage to corporate reputation.
- High Street Giant JD Sports
- Largest UK Car Dealership Arnold Clark
- Nissan North America was exposed in a data breach at a third-party service provider.
- Mailchimp digital marketing platform
- Royal Mail UK Postal service.
Businesses are increasingly storing sensitive data in the cloud, including client information, employee records, and intellectual property. With the terrifying rise in numbers of data breaches and cyber-attacks, businesses must be even more vigilant and diligent in protecting their information and evaluating their third party vendors and ensuring they are closing loopholes that could result in data leaks – accidental or malicious.
Third party risk strategy should be embedded into every business as it is a solid foundation to build a resilient business.
The first step to build a robust third party strategy is to identify all third parties your organisation engages with. Missing out that one supplier could be disastrous if they are the weak link that opens the door and welcomes in hackers.
Next evaluate the level of access each vendor has to your data.
Ask every vendor to complete a risk assessment questionnaire. The objective is to assess the level of risk based on how much access they have to sensitive data. You may require supplementary questions for third parties with higher level of access to data. Think about the organisations accessing your data from the IT company hosting your IT systems, your outsourced payroll holding employee data through to the small print company round the corner printing event invitations to your mailing list.
An audit of third parties can be simply done with the right tools and will make it easy to conduct a thorough review of each vendor’s cyber security policies and procedures, as well as their track record when it comes to compliance with regulations and data security protocols.
One last point, you should also consider the financial stability of each vendor and their insurance coverage in the worst case scenario that something does go wrong.
When the due diligence is complete you can feel confident that your chosen suppliers are the right third parties for your business.
Supplier management is a vital part of any business’s cyber security strategy. By conducting due diligence on vendors, identifying gaps and demanding they meet certain standards you are not only safeguarding your business but their business too.
Take the steps now to resolve some of the most common IT problems, such as data breaches, compliance issues, and third-party risks before disaster strikes resulting in business disruption, reputational damage and hefty fines.
Don’t bury you head in the sand, take control of your third-party relationships today. By managing suppliers, you stop exposing your business to a high level of unmanaged risk.