How can businesses protect against third party risk?

Organisations are constantly exposed to a multitude of cyber threats and risks with third-party security a major area of attention.

Understanding and effectively managing third-party risks are crucial aspects of a robust cyber security strategy.

This article delves into the intricacies of third-party security, its importance, and the role of cyber security training and awareness in mitigating these risks.

What is third party security?

At its core, third-party security encompasses the variety of risks and vulnerabilities stemming from the relationships an organisation maintains with external entities, including vendors, suppliers, and service providers.

When engaging with third parties, organisations inevitably find themselves in a dynamic exchange of sensitive information, data transfers, and resource sharing. While these collaborations are often essential for organisational growth and efficiency, they introduce a layer of complexity that can potentially expose the business to unforeseen cyber threats. This is because third parties often possess access to critical systems, databases, and proprietary information, rendering them potential targets malicious activities if not adequately secured.

Third parties inadvertently create potential entry points for cyber adversaries. External entities become integral components of the broader attack surface, and any compromise in their security posture can have far-reaching consequences for the primary organisation. Cybercriminals frequently target the weakest links in the chain, and third-party relationships represent potential weak points that demand vigilant safeguarding. The networks, systems, and data flows that extend into the domains of external partners necessitate a robust security strategy that comprehensively addresses potential vulnerabilities arising from these interdependencies.

Why is third party risk management important?

Third-party risk management is crucial due to the growing reliance on external entities, such as vendors, suppliers, and service providers, which has become an integral part of modern business operations. While these external collaborations bring about numerous benefits, they concurrently expose organisations to a myriad of potential risks and vulnerabilities.

• Data sensitivity and access control: External partners often have access to sensitive information, proprietary databases, and critical systems. Without effective third-party risk management, the exposure of such data to unauthorised individuals or cybercriminals could result in severe repercussions, including financial losses and damage to an organisation's reputation.
• Regulatory compliance: In an era of stringent data protection regulations, organisations are increasingly held accountable for the security practices of their entire supply chain. Third-party risk management ensures compliance with regulatory standards, shielding organisations from legal consequences and financial penalties.
• Reputational damage mitigation: A security breach or compromise in a third-party's system can tarnish an organisation's reputation, eroding the trust of clients, stakeholders, and the wider public. Third-party risk management is essential for preserving the integrity of the brand.
• Operational continuity: Dependence on external entities means that disruptions in their operations can have a cascading effect on an organisation. Effective third-party risk management involves contingency planning to ensure operational continuity in the face of unforeseen events affecting external partners.
• Intellectual property protection: Collaborations often involve the exchange of intellectual property or proprietary technologies. Inadequate third-party risk management may expose these valuable assets to theft or compromise, threatening an organisation's competitive edge.
• Supply chain resilience: With modern supply chains becoming increasingly complex and global, disruptions in the operations of one entity can have ripple effects across the entire supply chain. Third-party risk management enhances supply chain resilience by identifying and addressing potential vulnerabilities.

How to implement third party security?

The implementation of robust third-party security measures requires careful consideration and adherence to a structured framework. Here are key steps to ensure a resilient defence against potential risks:

1. Assess third party's security levels: This involves scrutinising their cyber security practices, training and awareness, data protection policies, and incident response capabilities. A comprehensive evaluation provides insights into potential vulnerabilities, enabling organisations to make informed decisions regarding the level of risk associated with a partnership.
2. Include third party security protocols in vendor contracts: Effective third-party security begins with clear and enforceable protocols outlined in vendor contracts. These agreements should articulate expectations regarding data protection, access controls, incident reporting procedures, and compliance with industry standards and regulations. By doing this, organisations establish a shared commitment to maintaining a robust security posture.
3. Identify responsible individuals and decision-makers: Designating key individuals within the organisation to oversee and manage third-party relationships is pivotal. These individuals serve as the point of contact for security-related matters, ensuring effective communication and decision-making. As a result, organisations can respond swiftly to security incidents and effectively implement uniform security protocols.
4. Continually audit and reassess third-party vendors: Cyber threats are dynamic and ever evolving, making regular audits and reassessments of third-party vendors a necessity. Periodic evaluations ensure that external partners adhere to agreed-upon security measures and remain aligned with the organisation's evolving security standards.
5. Build offboarding protocols for partnership terminations: While onboarding is crucial, establishing clear offboarding protocols is equally important. When terminating partnerships with third-party vendors, organisations must have procedures in place to secure the transition. This includes ensuring the secure transfer or deletion of data, revoking access rights, and conducting a final security assessment to mitigate potential risks associated with the termination.

By weaving these steps into external collaborations, organisations not only protect their own assets but also contribute to a more secure digital ecosystem.

Common obstacles in third party risk management

While the importance of third-party risk management is undisputed, organisations often encounter common challenges that can impede the implementation of security measures. Recognising and addressing these obstacles is crucial for ensuring the effectiveness of a comprehensive cyber security strategy.

• Inadequate resources: One of the primary obstacles in third-party risk management is the allocation of insufficient resources. Organisations may struggle with limited budgets, manpower, or technology, hindering their ability to conduct thorough assessments and implement comprehensive security measures. Prioritise resource allocation by conducting a risk assessment to identify critical areas and target departments.
• Lack of standardised processes: A lack of standardised procedures may result in a lack of oversight, leaving organisations susceptible to unforeseen vulnerabilities. Establish clear guidelines for risk assessments, documentation, and communication. Regularly review and update these processes to adapt to evolving cyber threats and organisational needs.
• Difficulty ensuring third-party compliance: Enforcing compliance with established security protocols among external partners can be challenging. Third parties may vary in their commitment to cyber security measures, making it difficult for organisations to ensure a uniform standard across all collaborations. Incorporate stringent security requirements into vendor contracts. Implement regular audits to verify compliance and address any deviations promptly. Foster open communication channels to encourage a collaborative approach to security among external partners.
• Insufficient visibility into supply chain: Lack of visibility in external entities increases the likelihood of overlooking potential vulnerabilities. Collaborate with industry peers, colleagues, and cyber security experts like TSC to share insights and best practices for managing third-party risks within complex supply chain ecosystems.
• Limited employee awareness: Employees may not be fully aware of the risks associated with third-party relationships, potentially leading to inadvertent security lapses. Insufficient training and awareness programs can contribute to a lack of vigilance among staff members. Prioritise cyber security training and awareness programs that specifically address third-party risks. Educate employees on recognising potential threats, adhering to security protocols, and reporting suspicious activities. Foster a culture of shared responsibility for cyber security.

By proactively addressing these common obstacles, organisations can strengthen their third-party risk management practices. Overcoming these challenges requires a combination of strategic planning, resource allocation, and a commitment to cultivating a security-conscious culture.

The role of cyber security training and awareness

Cyber security is not only about technological solutions but also about empowering individuals within an organisation. Cyber security training and awareness play a crucial role in mitigating third-party risks by educating employees about potential threats, safe practices, and the importance of adhering to security protocols.

Employees should be trained to recognise phishing attempts, understand the risks associated with sharing sensitive information with third parties, and know how to report security incidents promptly. Fostering a culture of cyber security awareness encourages employees to actively contribute to the organisation's overall security posture.

Final word

Protecting against third-party risks is a multifaceted challenge that requires a combination of technological solutions, robust processes, and a well-informed workforce.

By implementing thorough risk management practices and prioritising cyber security training and awareness, organisations can significantly enhance their resilience against the evolving threats posed by third parties.

Working with the right partner

Partnering with a trusted cyber security training and awareness company, such as The Security Company Ltd. (TSC), is crucial. With 25 years of experience, TSC specialises in enhancing security behaviours, fostering a robust security culture, and raising awareness of threats and risks across global organisations.

The dynamic nature of cyber threats necessitates a comprehensive and adaptive cyber security strategy for UK law firms. By understanding the evolving threat landscape and investing in robust training and awareness initiatives, decision-makers can fortify their organisations against potential risks and cyberattacks.

At The Security Company, we specialise in boosting cyber awareness, targeted training, customised projects and role-based solutions. Through our tailored subscription services, targeted and customised eLearning and awareness materials and our behavioural assessments, we're committed to helping organisations like yours instil long-term, security-conscious behaviours.

Our method is distinct. We begin by diving deep into your team's current mindset, pinpointing lax behaviours, security gaps and departments in need of focus and attention. From there, we craft tailored solutions that encourage better cyber practices from your employees. With comprehensive training and seamless integration into your current systems, we're here to fortify your team against modern cyber threats and be your trusted cyber security and awareness partner.

Ready to take the next step?

We can help you to formulate an effective and comprehensive cyber security training and awareness program for your organisation year-round and be your dedicated partner for employee behaviour change and, ultimately, security culture change.

Do not hesitate to contact us for further information.