Data Insights Report
A spotlight on legacy systems
So cybersecurity professionals can systematically understand risks, whilst making sure things don’t fall through the cracks, frameworks are used to conduct assessments. These assessments cover the various risks faced by a business, including:
It is often just tempting to look for security certifications like Cyber Essentials Plus accreditation, ISO27001:2013, alignment with the NIST Cybersecurity Framework, PCI DSS compliance and SOC 2 reporting.
Unfortunately, these are just one part of the mix and don’t give you a holistic picture of the risks associated with a supplier. TPRM platforms like Risk Ledger will ask suppliers about their certifications, but also ask a holistic set of questions about other risks. You can learn more on our Supplier Assessment Framework Knowledge Base.
It is important that the risk management frameworks are broad enough to incorporate all these risks, but reduce the overhead for both vendors and suppliers. This is where tools like Risk Ledger help, as we automate the questionnaire process for customers. For suppliers, they can complete their risk assessment once and share it with multiple customers. Moreover, Risk Ledger then allows customers to access fourth and fifth party risk assessments, accessing insights for the vendors of vendors.
Third-Party Risk Management (TPRM) is the process of identifying, assessing, and mitigating risks that arise from working with external vendors, suppliers, or service providers. It ensures that these third parties meet your organisation’s security, compliance, and operational standards. A solid TPRM approach helps prevent data breaches, supply chain disruptions, and regulatory violations by continuously monitoring third-party performance and addressing potential vulnerabilities. Ultimately, it protects your business from external risks that could impact operations, reputation, or financial stability.
TPRM frameworks are important because they provide a structured approach to managing the risks that third-party vendors can introduce to your business. Without one, it's easy to overlook vulnerabilities that could lead to data breaches, operational disruptions, or compliance failures. A strong framework helps you identify risks early, monitor vendor performance continuously, and respond quickly to threats. It also ensures your business stays compliant with regulations like GDPR or DORA, reducing the risk of fines or reputational damage. Ultimately, TPRM frameworks protect your organisation’s security, stability, and long-term success.
There are several types of TPRM frameworks, each with a different focus. Risk-based frameworks prioritise assessing and managing the most critical risks to your business, ensuring resources are allocated where they matter most. Compliance-driven frameworks centre around meeting regulatory requirements, helping businesses align with standards like GDPR or DORA. Operational frameworks focus on minimising disruptions in supply chains and day-to-day operations by ensuring third parties meet performance and reliability standards. Risk Ledger’s framework takes a collaborative approach by creating a shared platform where organisations and their suppliers manage and mitigate risks together, fostering transparency and improving overall supply chain security.
When choosing a Third-Party Risk Management (TPRM) framework, focus on scalability, customisation, and regulatory alignment. It should adapt as your business grows, accommodate industry-specific risks, and integrate with existing workflows. Look for automation features to reduce manual effort and ensure continuous monitoring. The framework must provide clear reporting and risk visualisation to support informed decision-making. Additionally, consider how well it aligns with relevant regulations like GDPR or DORA, ensuring compliance is baked in from the start. Lastly, seek input from key stakeholders to ensure the framework addresses both operational and strategic risks.
A third party risk assessment is the process of evaluating and managing the risks associated with the use of third-party vendors and suppliers. This involves identifying potential risks, assessing the likelihood and potential impact of those risks, and implementing measures to mitigate or manage the risks. The goal of third-party risk assessment is to ensure that organizations can effectively manage the risks associated with their use of third-party vendors and suppliers, and minimize the impact of any disruptions on their operations and customers.
To perform a third party risk assessment, an organization should start by identifying the third-party vendors and suppliers that are critical to its operations. The organization should then assess the potential risks associated with these vendors and suppliers, including risks related to data privacy, security, financial risk, governance risks, and business continuity. It should also evaluate the third-party vendor or supplier's risk management practices to ensure that they are aligned with its own risk management framework. Finally, the organization should implement measures to mitigate or manage the identified risks, such as requiring the vendor or supplier to implement specific security measures or contingency plans. Regular monitoring and review of third-party risk management practices is also important to ensure that they remain effective over time.
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