Venminder’s State of Third Party Risk Management Survey provides insight into how financial services and financial technology companies manage third party risk management. To give you the biggest industry-wide view we even took it a step further this year and expanded into new markets like non-bank lenders, fintechs, wealth/asset management and brokerage and insurance companies in addition to banks and credit unions.
Our whitepaper presents many findings – one being the two big hurdles organizations are trying to overcome.
Biggest Challenges for Third Party Risk Management
One survey question we asked respondents was, “What do you see as your next biggest hurdle?”.
Here are the results:
- Fourth Party Assessments – 40%
- Cybersecurity Assessments of Third Parties – 34%
- Cloud Providers – 14%
- BCP/DR Assessments – 6%
- Other – 5%
- Mobile Provider Assessments – 1%
Fourth party assessments and cybersecurity assessments of third parties took the lead with a sweeping 74% of respondents agreeing that these two areas are their next big hurdles to overcome. Let’s dive further into why we think that is.
Fourth Party Monitoring Is an Expectation
Although there isn’t regulatory guidance per se regarding fourth party vendors, we’ve seen the area become a focal point over the last year. Examiners are looking for due diligence on fourth party vendors that have even tangential access to customer data.
They want to know what the third parties are doing to protect it and how well your organization understands the process. Luckily, with the introduction of the SSAE 18 in 2017, third parties must now disclose their significant vendors so identifying your fourth parties should become a little easier to do.
Cybersecurity Is an Industry-Wide Hot Button
We’re not surprised to see that 34% of respondents said third party cybersecurity assessments are their next big hurdle. In today’s tech heavy environment cybersecurity absolutely needs to be a concern.
We often say around here that it’s not a matter of IF your data is breached but instead WHEN it’s breached. The unfortunate reality is that an incident will likely occur at your organization at some point so it’s important to do your very best to prepare. One of the best ways to protect your organization’s information is to have a strong cybersecurity assessment in place.
See more noteworthy findings, download the survey results and State of Third Party Risk ManagementWhitepaper for a full analysis.