Privacy Matters: Strengthening Your Third-Party Risk Management Program

Privacy laws have continued to evolve and adapt with newer risks and threats each day. It is important to understand these laws and be updated with best practices to avoid any breach or fines by respective regulatory authorities. Organisations must always ensure that management models practices align with evolving privacy laws and compliance frameworks. How will this affect Vendor Risk Management?

Organisations deal with Vendor data in a daily basis, these data may include financial information, proprietary intellectual property, key personnel information, security audits/reports, etc. These data policies ensure that management models (SCRM, TPRM, VRM, TPSRM) comply with rigorous policies and procedures for data security.

By establishing comprehensive data security policies, organizations can mitigate risks associated with unauthorized access, data breaches, and compliance failures. These policies should outline clear procedures for data handling, storage, and sharing, as well as protocols for monitoring and auditing vendor compliance. This proactive approach not only safeguards sensitive information but also fosters trust between organizations and their vendors.

Privacy Laws mostly consists of (1) Defining data, which includes any key identifiers held by an entity. The scope of what the data consists of and categorising it accordingly. (2) Right for individuals, which may include access, removal, rectification, portability, etc. (3) User opt-out and consent requirements (4) Data protection obligations, and notifications. These particulars are balanced to ensure data is used accordingly and is protected from any threats.


Some policies and legislation enforced for data protection
General Data Protection Regulation (EU)
Personal Information Protection and Electronic Documents Act (CA)
California Privacy Rights Act (USA)
Japan's Act on the Protection of Personal Information (JP)
China’s Personal Information Protection Law (CN)



Strategies to implement in compliance with data policies

(1) Keep tabs on data policies and legislation. Create a log of data policies directly affecting your industry and monitor their statuses. Manage a routine to update the tabs at least on a monthly basis and keep notes on key changes. If there are any; prepare an action plan immediately to meet compliance.

(2) Provide sufficient knowledge and training within the organization. Regular training for employees and vendors is vital to enhance awareness of data policies and vendor risks. Training programs should focus on compliance, security best practices, and the importance of data integrity to minimize errors and risks.

(3) Streamline your VRM with the business’ goals and regulatory requirements. Aligning VRM, or any third-party programs with business objectives helps prioritize risks and create a clear action plan. This alignment ensures that the VRM strategy supports the organization's broader goals while meeting industry-specific regulatory requirements such as GDPR and HIPAA

(4) Develop action, and business continuance plans. As part of risk management, it is imperative that organizations remain vigilant in identifying and addressing alarming risks related to data policies and legislative compliance. The dynamic nature of regulatory landscapes and the increasing sophistication of cyber threats necessitate a proactive and comprehensive approach to risk mitigation.

By establishing a strong framework, conducting comprehensive vendor assessments, implementing continuous monitoring, developing business continuity plans, and fostering a culture of compliance, organizations can effectively mitigate risks and ensure adherence to regulatory requirements. This proactive approach not only protects vendor data but also strengthens vendor relationships and enhances overall organizational resilience.