Risk management in business refers to the forecasting and evaluation of financial, legal and other negative factors together that could harm your business while identifying potential solutions or procedures to avoid or minimize their impact. Having a risk management software that can evaluate and track third party relationships and review the risk compliance and risk assessments for your third party risk management framework is crucial.
Reviewing third party risk management and compliance management through a trusted risk management software, such as VendorInsight®, will allow you to review both inherent risk and residual risk. Inherent vendor risk is the first impression of risk that a new or potential vendor poses. This allows for a more in-depth assessment of their compliance management policies and procedures they have in place to mitigate and manage potential risk concerns. It also provides a chance to reach out and see if they are being proactive and implementing stricter security procedures to reduce risk. Residual vendor risk is the amount of risk that may remain after the inherent risk has been identified and steps have been taken to reduce the risk.
Risk management software allows the design of new business processes with adequate built in risk control and containment measures. Risk Management software is constantly evolving, so policies and procedures should be ever changing to allow for the increase in complexity and to continue to challenge businesses to develop strong, fully comprehensive risk management solutions. It should be a way for everyone to be able to avoid detrimental business risks all together and create strong compliance management controls.
Asking key questions about your current third party relationships and third party risk management framework will help reveal insights and potential gaps in risk compliance. This can help ensure that you anticipate changes that can occur in the future and are using a risk management software that is comprehensive to your third party vendor needs. Having a strong vendor risk management software, gives you the ability to perform due diligence and score vendors on multiple key variables to determine their overall risk breakdown.
VendorInsight® provides you with a strong framework for your risk management solutions. It provides a platform for you to be able to assess vendor performance through tools, like our vendor scorecards, that allow you to compare to similar vendors, make informed decisions on performance and risk compliance and make sure you are getting the strongest return on investment (ROI) for your outsourced services. A robust vendor management program also gives banks insight into contract spend, risk and impact for the services contracted to third-parties. This data, along with intuitive reporting, can help highlight where you can maximize ROI through contracted services without increased volatility.
VendorInsight® risk management software performs continuous monitoring of your vendors and optimizes your oversight program. This provides compliance management of all of your vendors, which will reduce the risk of spending time and resources to fix financial risks. Risk compliance can become a bigger problem for your company that it can for the vendor. While they might lose business, your company could be hit with regulatory fines, penalties and even face lawsuits. By tracking vendor risk compliance through risk management software, you are creating a repository that can be easily accessed and focused to create useful data for your organization.
This also provides a platform for which you can establish compliance requirements for information security, regulatory compliance and vendor contracts. Since not all vendors will have the same level of risk, the regulations will be slightly different for each. However, by establishing standard compliance requirements for all vendors across the board, this will provide a consistent approach to vendor management practices. Standard requirements will provide the ability for your company to understand each vendor, the products of services they provide and the documents and practices they have in place already for regulatory compliance and due diligence.
Third-party management regulation varies between companies, financial institutions and industries. While it can be hard to stay on top of the ever changing regulations, it is always important to think about, the quality of service they provide, their risk management practices, financial conditions and applicable contracts and reports that they may have in place. These factors can help create an effective vendor oversight program that will fulfill the majority, if not all, of the regulatory expectations in changing markets.
VendorInsight® can provide the framework for optimizing your vendor oversight and monitoring program capabilities by consistently monitoring your high risk and critical vendors to deliver a comprehensive clear picture of their vendor risk and each vendor’s due diligence. Some of the features included are:
VendorInsight® also offers VRM Pro services which allow our experienced team of experts to do the groundwork and review of all of your vendor due diligence reports. Our VRM Pro services offer collecting and reviewing of your vendor SOC1/ SOC2 reports, financials, business continuity plans, information security plans, and certificates of insurance. As well, the VRM Pro team is now working to develop a strategic and comprehensive compliance review for each vendor.
Vendor Risk Management
VendorInsight® is the comprehensive resource for improving your VRM program. With its monitoring and evaluation features, outsourced vendor risk management solution in VRM Pro ™, and industry-leading automation of processes, policies and workflows, VendorInsight® provides the tools to face any risk management hurdle.
Request a demo today to learn more about how VendorInsight® VRM solution can help you manage your third-party vendor relationships, maintain compliance with regulations and meet your business objective.