The Place Of Management In Third-Party Cybersecurity Risks

With rising cybersecurity risk cases and incidents, embracing management best practices to optimize costly third-party cybersecurity solutions and risks cannot be over-emphasized.

This case was recently hammered upon by co-founder and chief product officer of LogicGate, Jon Siegler, with over a decade of experience in designing customer-centric enterprise risk and compliance systems. 

For many cybersecurity professionals, if not all, who have experienced such things as “after the breach” feeling — the moment they realize it, they will have to tell their customers that their personal information may have been compromised because one of their vendors had a data breach. 

Such situations also involve spending significant amounts of time and resources fixing a problem caused by a third party.

No matter how well you clean things up, the reputational hit to your organisation will continue to cost you lost business down the road. 

The fact is the consequences of failing to properly manage third-party risk are far too costly to ignore.

If You Neglect Cyber Risks, Be Ready for the Price

Ransomware attacks, data breaches, and widespread IT outages ranked this year as the most significant risk concerns for companies worldwide.

More than seven in ten organisations fear third parties have too much control over customer data, including needlessly broad permissions and authorisation.

Of the 44% of organisations that reported a data breach last year, 75% said the breach stemmed from a third party’s excessive privileged access.

Because they integrate so seamlessly with many aspects of modern organisations, third-party vendors’ risks are your risks.

While managing third-party cyber risk is essential to maintaining customer trust, it is also increasingly important for organisations looking to purchase cyber insurance policies.

All it takes is an accidental email containing personal information sent to the wrong customer, and the basic standards for a data breach have been met.

Add the various state and federal data laws and costs associated with remediation, and it becomes clear why every organisation could benefit from cyber insurance.

As more contracts between businesses contain cyber insurance clauses, it’s important to consider the impact security standards have on obtaining a policy.

To put it plainly, the better your security standards are, the better your rates, especially at a time when cyber insurance premiums are soaring.

Cyber insurance providers want to see that you have high standards of security before they issue a policy, so effective third-party risk management could mean the difference between potential insurers offering you a good rate or deeming you ineligible for coverage.

Time to Manage Third-Party Risks and How

An organisation’s ability to handle third-party cyber risk proactively depends on its risk management strategies.

According to Forrester, 70% of enterprise decision-makers agree that third-party risk is a business priority, but about 69% use manual processes in their third-party risk programs.

The following steps are recommended for managing third-party risks:

•  Try developing structured vendor onboarding and offboarding processes. This is because a structured, repeatable, vendor onboarding and the offboarding process is the best way to ensure proper screening, vetting, selection and smooth functioning all through your relations with your third party.  
• Determine to plan your third-party incident response plan. Should a third-party incident occur, you ought to have an action plan of response planned and ready, by having a handy list of threats and risks most relevant to you and then formalising a procedure of response and mitigation of risks? 
• Have a risk baseline. It is best to have a framework outlining a defined process you are undertaking, long before starting to research and assess third parties. Such planned and detailed guides are pre-emptive of risk occurrence. 
• Enable Continuous activity monitoring. Having a set of third-party vendors entails regular monitoring that would also allow you to spot any issues in advance. 
• Know who your third parties are. This is one of the most crucial steps in risk management– to know who your third parties are and understand how much is being shared with each to be able to determine the risk they pose to you. 
• Enable access management. All third-party vendors do not have the same level of access to your data and network, and consequently, they pose different levels of threat. It's very important to know their access and privileges within your system.  
• Perform regular security tests on API. APIs are one of the easiest access points for exploiters to attack. Secure them with proper and regular security testing.  

Conclusion 

Being proactive is the name of the game when dealing with hackers and securing your data and networks by undertaking effective risk evaluation, baselining, and management without delays.

Determine and stick to efficient ways to manage your third-party risks through such software tests that focus on security testing.