Vendor Risk Management: Why You Need to Think About Third-Party Cybersecurity
All About Vendor Risk Management: How Secure Are Your Vendors?
You might be investing a lot in your own company’s cybersecurity. But are you taking steps to ensure your vendors aren’t putting your business at risk? Let’s talk about vendor risk management and why vendor security is a must.
Around 46% of Americans have been victims of credit card fraud. Protect your business and all of your sensitive information with vendor risk management.
Nearly half of all credit card fraud (47%) happens in the United States. Unless you’re taking extra steps to protect your sensitive data, you’re at risk for a security breach.
Here’s what you should know about working with 3rd party vendors and being safe:
What is Vendor Risk Management?
Vendor risk management involves identifying and decreasing legal liabilities and uncertainties in business. It also entails managing how third-party vendors deal with sensitive information.
Sensitive data is transmitted and processed on company and vendor networks. When you hire a 3rd party vendor, all of this data is processed and saved on their database, even if they don’t create a back-up.
Sensitive information like credit card numbers, passwords, and social security numbers don’t simply linger in a database. This data gets transmitted to other areas. For instance, data often gets transmitted to logging servers.
Implementing vendor risk management policies lessen the likelihood of sensitive information getting abused.
Develop a Strategy
Vendor risk management involves vendor risk assessment. Only get involved with honest, trustworthy vendors. Develop a set of questions vendors must answer to assess their risk level.
A good strategy always has a contract that details the business relationship between the organization and the business. Your contract should have stipulations that vendors must meet to ensure high-quality performance in maintaining cybersecurity. Their performance should be regularly monitored.
The vendor agreement should have guidelines explaining who has access to what information. There should also be explicitly stated rules against abusing this information.
Choose and Monitor Vendors Wisely
All vendors should meet stipulations that comply with the regulatory guidelines of your industry. How vendors are meeting these stipulations should always be monitored.
For instance, if your vendor has a 10% failure rate in internet software patching, can you really trust them with sensitive information? Research vendors thoroughly and don’t be afraid to ask questions.
Your vendors should have a security policy and procedures that extend beyond the bare minimum. Without written policies, security risk assessment is left to individual interpretation.
Look out for vendors who’ve gained special recognition for their security practices. This includes awards and certifications from organizations like Service Organization Controls (SOC) and the Health Information Trust Alliance (HITRUST).
You should always verify that your vendor conducts regular information security risk assessments. Security risk assessments should evaluate the likelihood of risks and their impact, implement changes to fix the risk, and document those changes afterward.
Encrypt Data In Transit
Encryption protects data by making it unreadable without a password.
Sure, it’s easy to claim data is encrypted when it’s on the server, but what about in transit? Third parties vendors should be encrypting sensitive information while it’s being transmitted to another server.
Ask vendors specific questions about how they protect data in transit in certain situations. Make sure the keys used to encrypt the data are highly protected.
Keep Your Data Safe and Secure
Nearly 76% of all IT security breaches are money-motivated. Save yourself money and time with vendor risk management.
Give yourself some peace of mind and learn more about cybersecurity. You’re better off safe than sorry.