Improving Third-party Management Through Policies

Has your organization implemented an effective policy management framework to protect itself against third-party risk? Your organization is defined by its third-party relationships in our modern business environment, and third-party risk is also your organization’s risk.

The boundaries of business have become increasingly complicated and lacks transparency over time. In order to manage third-party risk effectively, effective policies, initial due diligence, and ongoing/continuous assessment is required to effectively monitor third parties and govern the lifecycle of the organization’s relationships. This can be accomplished through:

• Creating standardized policies and procedures for onboarding and offboarding - Following a standardized onboarding and offboarding process ensures that you’re not missing any critical requirements, that employees and vendors are aware of expectations, and that you and your vendor are prepared to start working in collaboration. Your organization will first want to define these processes and lay out clear policies and procedures to protect the organization and standardize the workflow.
• Mandating ongoing and continuous vendor monitoring – Your organizations should leverage rule and policy-based triggers for assessments when certain thresholds are breached, or related events and emerging risks are discovered. Regular, scheduled follow-up assessments should also be mandated within the organization’s policies.
• Engaging third parties on relevant and related policies – There are many different internal policies that a third-party vendor may need to be made aware of, be that the supply chain/vendor code of conduct or data security policies. Your organization needs to ensure that your third parties are engaged and made aware of any relevant policy that may be relevant in that relationship.