Governance of Third-Party Relationships
In today's world, most organizations are heavily reliant on third parties to achieve one or more business objectives. The primary reason to obtain the services of a third party is to benefit from expert services in a cost-effective manner. These third parties can be service providers, trading partners, group companies, and so on.
These third parties are connected to the systems of the organization and have access to its data and other resources. To protect the organization, it is very important for an information security manager to assess the risk of such third-party relationships and ensure that relevant controls are in place.
Policies and requirements of information security should be developed before the creation of any third-party relationship.
Furthermore, the security manager should understand the following challenges of third-party relationships:
- The cultural differences between an organization and the service provider
- Technology incompatibilities
- The business continuity arrangements of the service provider may not be aligned with the requirements of the organization
- Differences in incident management processes
- Differences in disaster recovery capabilities
Effective governance is highly dependent on the culture of the organization. The next section discusses this in more detail.