Effective Third Party Risk Management

Most companies will rely on other businesses in order to help them comply with various regulations and standards that are otherwise lost on them. Let’s face it, trying to fit your business within these regulations while also remaining competitive does require some finesse. You need to understand these regulations and the risks involved if you’re serious about growing your company. The larger your business, the more intricacies you’ll have to deal with and the more you put at risk.

That’s why third party risk management has become such a huge business opportunity. It involves helping other companies deal with compliance and helps them manage their potential risks. Disruptions to businesses are hard to predict, but there’s a certain level of planning that needs to be considered in order to reduce these risks. Risk management helps you think ahead so that should some kind of disaster occur, you can easily overcome it with your pre-planned systems and work processes.

In this post, we’ll take a look at some effective third party risk management solutions that will give your business many safety nets.

Screening services

When hiring new employees or bringing in new organizations to work with your company, it’s important to use third party screening to help you understand the partnership that you’re about to form. Monitoring and screening can help you understand another party and help you make informed decisions regarding their practices and attitude. Doing background checks will ensure that you’re dealing with people or a company that can actually be trusted. This will drastically reduce the chances of a new party tarnishing your name or creating compliance risks that could bring your business down.

Business continuity planning

Adversity can happen unexpectedly. A natural disaster could tear through your physical office, destroying much of your data and storage along the way. Or, an unsuspecting employee could open a fake email and unleash a disruptive virus into your office network, stealing information and destroying files that are important to your business. These are very real concerns that need to be addressed, but even with all the security and insurance you have, it’s still important to have a business continuity plan in place.

Contract management software

Contracts are legally binding which makes them particularly scary. If you don’t read through and understand contracts, then certain clauses can trip you up and create huge problems in the future. Contract management software makes it easy for you to understand, create and sort many different contracts to ensure that you have full knowledge of all your business dealings.

IT vendor risks

Third parties often need access to regulated information on your company. This increases the likelihood of a security breach especially if the company you are working with hasn’t been screened before, or you’re unsure of their business practices and have yet to read through the terms of their service. Many third party companies will use information gathering in order to learn more about their clients, and there’s no telling where this information will end up and who it will be used by. Work on reducing IT vendor risks but ensure that you check with all vendors on their practices.