Protecting Your Business from Third-Party Security Breaches
In today’s market, businesses rely on the services of third-parties more and more. Many companies outsource significant volumes of work to specialists without properly considering their cybersecurity controls and transparency. Yet each vendor you outsource to will have an impact on your cybersecurity.
Here is how you can set up your arsenal to best protect your business from third-party data breaches.
What is a Third-Party Data Breach?
This kind of breach occurs when:
Your company data is stolen from a third-party vendor
Hackers use the vendor’s systems to gain access to your systems
In short, the link between your business and the third-party is exploited to access and steal sensitive information, compromising the privacy of your clients and the security of your operations. Losing data in a cyberattack like this can cause near irreparable damage to your company’s reputation and incur significant financial losses.
So, how can you prevent this from happening? Here are some of the basics that we help set up for our clients who are at risk from third-party security breaches.
Assess Your Vendors
Before you onboard a new party, you need to be aware of the risks - and how to mitigate them. Assessing your potential vendors by looking at their security practices and where their systems are vulnerable is key to performing sufficient due diligence checks.
Using security ratings will allow your business to immediately understand the external security infrastructure of the vendor. This way, your company can also avoid the need to conduct time-consuming risk assessment checks such as on-site visits and penetration tests.
The reports generated can be shared with the vendor to resolve issues, or can be used as a benchmark against their competitors. The rating will give you an accurate indication of the risks involved and best allow you to make an informed decision.
Set Up an Inventory System
Without clearly monitoring your third parties, it will be impossible to accurately calculate the level of risk posed by these working relationships. Set up an inventory system to enable your company to clarify exactly:
Who your third parties are
How much of your sensitive information is being shared with them
This system will let you monitor your in-use vendors in detail and identify threats before they become an issue. Continuously update their ratings and don’t wait for infrequent review dates. You want to be aware of problems in real time.
Just under half (46%) of businesses currently carry out risk assessments on third parties who deal with their sensitive data - meaning that the majority are exposing themselves to unnecessary risk.
Collaborate with Vendors
Prioritise collaboration in your dealings with third-party services. Your business needs to be able to request cybersecurity improvements without being combative.
While it is impossible to entirely prevent breaches, you can cooperate to resolve risks swiftly. Making sure your vendors understand what needs to change - and why - will go a long way to protecting your information and systems.
Add Risk Management to Contracts
That being said, your business should always incorporate risk management into your contracts with third parties. This practice will ensure that your vendors are held accountable in case of a slip in cybersecurity standards or avoidable data breaches.
We recommend to our clients that contracts should stipulate:
That the vendor maintains a security rating above a set figure to keep their contract.
The right to request a security questionnaire once every quarter. This will draw attention to any cybersecurity problems that have been missed by external ratings.
The requirement to make you aware of, and redress, any cybersecurity issues within 72 hours or another set time-frame.
Cut Ties with Bad Vendors
If the specialists you outsource to don’t take sufficient steps to uphold their cybersecurity standards, or if they breach these contractual obligations, you may need to off-board them. Set up a process for off-boarding without compromising the day-to-day operations of your business or causing continuity issues in the long run.
A proper off-boarding strategy is an often forgotten part of successful risk management. Establish from the get-go whether you would be willing to cut ties in the event of a data breach or ransomware attack.
Assess Fourth-Party Risks
The economy is growing ever more interconnected. Just as it’s important to know and monitor your onboarded vendors, your business needs to consider who these vendors rely on and who else may gain access to your data.
Your sensitive information could be exposed to companies with lower security standards if you don’t take action to measure and remediate fourth-party risks. Add to your contracts that the companies you outsource to need to notify you when they share data with a fourth or even fifth party.
Train Staff at All Levels of the Business
Responsibility for the cybersecurity of your company doesn’t just lie with the IT department. Training staff at all levels of your organisation will ensure that the necessary steps are taken to prevent avoidable breaches. Teach basic cybersecurity practices to all staff members, and apply them in the day-to-day procedures of each department.
Keeping mobile devices secure, using end-to-end encryption, and establishing a monitoring and enforcement team will supplement your third party security protocols. Importantly, ensure that your staff are trained to never share more sensitive information or provide more access to third parties than is strictly necessary for them to complete the outsourced job.
Contact Us Today
This post has only touched the surface of the groundwork that needs to be completed to give your business the maximum possible protection from cyberattacks.
Get in touch with us for more expert advice on how your company can improve its cybersecurity framework and reduce the risks from its third-party vendors. We will tailor our range of specialised services and solutions to your business and take your cyber defences to the next level.
