Vendor Risk Assessment Challenges: What You Need to Know>
– Hyperproof Team
Vendor risk assessment is not only a good practice but also a legal requirement due to various regulations such as CMMC, GDPR, SHIELD Act, CCPA, and industry standards like AICPA (SOC 2), CSA (CAIQ), HHS (HIPAA), ISO, NIST, and PCI.
These regulations and authorities emphasize the need for effective third-party risk management programs to meet compliance requirements and enhance IT security controls.
According to Hyperproof’s 2023 IT Compliance Benchmark Report, 29% of security, compliance, and risk management professionals consider third-party risk as their top source of stress, second only to cybersecurity risks.
To address these challenges, organizations can consider adopting a third-party risk management software that can alleviate the burden and provide greater peace of mind.
Here are four common challenges that organizations face when conducting vendor risk assessments:
Challenge #1: Maintaining an up-to-date list of vendors
Organizations struggle to keep an up-to-date list of vendors and obtain complete questionnaire responses from them.
Gathering quality information and understanding the true risk profiles of vendors is time-consuming and requires many manual and administrative tasks.
Lack of a central system for vendor tracking exacerbates this challenge.
Challenge #2: Developing a security questionnaire that generates meaningful insights
Creating a questionnaire that elicits accurate responses and generates meaningful risk insights requires knowledge of vendor usage, supported business processes, data types processed, system interconnectivity, legal and compliance risks, and collaboration with vendors.
However, many risk and security professionals lack sufficient time due to manual collection of risk information using ad-hoc tools like spreadsheets and email threads.
Challenge #3: Managing remediation projects and monitoring vendors after onboarding
After assessing vendors’ risks, risk and security professionals must ensure timely remediation and promptly identify changes in vendor risk levels.
Without proper tools and processes, managing remediation becomes a manual and time-consuming task, leading to challenges in resolving audit findings related to third-party risk management.
Challenge #4: Providing proof of vendor risk management activities for compliance
Regulations and security frameworks require companies to collect proof of their vendor risk management activities.
Without organized compliance artifacts and evidence collection systems, tracking down all the necessary documents during audits becomes a major challenge.
To address these challenges, vendor risk management software (VRM) solutions like Hyperproof can be valuable.
They provide tools to automate risk assessment and remediation processes, maintain oversight of vendors, assess vendors through questionnaires, collaborate with stakeholders, establish project management systems, reduce vendor risks through controls, and demonstrate compliance effortlessly by linking vendor management activities to risks, controls, and security standards within the software.
In summary, adopting a vendor risk management software like Hyperproof can help organizations effectively manage the assessment process for vendors and third parties, automate tasks, provide reporting and risk insights, and streamline compliance efforts, ensuring a secure, compliant, and resilient future.
Link: https://securityboulevard.com/2023/09/vendor-risk-assessment-challenges-what-you-need-to-know/