Manage Your Third-Party IT Risk

Collaborating with a third-party vendor provides many benefits but can expose a business to significant risk. In today's digital age, a strong IT environment is crucial for the success and security of any organization. Ensure your business is implementing the following best practices to protect itself.

Be aware of controls

To strengthen a SOX IT control environment, businesses must be vigilant in reviewing vendor safeguards and ensuring they are adequately protecting data. This includes paying close attention to Complementary User Entity Controls (CUECs), which the vendor includes for the user entity to implement to achieve the vendor's control objectives.

Don't Forget About Reports

SOC1 Type 2 reports provide detailed information on a vendor's internal controls and can help businesses confirm that they are operating appropriately regarding data security. Requesting and reviewing these reports annually is essential to validate that controls are in place to protect sensitive financial information.

Monitor Your Data

Your business should also be aware that third-party vendors may share your data with other vendors. Organizations must familiarize themselves with other vendors' policies and frameworks if they share data. To stay on top of potential third-party risks, keep track of new vendors added to your organization and monitor them throughout the contract.

“Risk levels with third-party vendors are constantly changing over time,” said Fawzi Habib, Manager at Clearview Group. “Organizations may have felt safe when they first assessed the risk of their third-party vendors but could now be completely overlooking new risks and disregarding regular security assessments.”

By continuously evaluating the safeguards your third-party vendors have in place, requesting and reviewing SOC1 Type 2 reports, and being aware of any data sharing with other vendors, your business can take steps to strengthen its SOX IT control environment and protect its organization against third-party risk.

Always Follow General Best Practices

While protecting your business from third-party risks is vital, this cannot be the only focus regarding IT security. Technology is woven into every aspect of your business, so it is paramount to ensure your business has all its bases covered regarding cyber threats and data breaches.

• Use strong, unique passwords for all accounts and regularly update them. You can also consider using a password manager to generate and store passwords securely.
• Enable two-factor authentication to add an extra layer of security by requiring users to provide a second form of authentication (such as a code sent to their phone) before logging in. This makes it much more difficult for attackers to access your systems.
• Make sure to regularly update all software and security protocols, including operating systems, antivirus software, and firewalls. Outdated software and protocols can contain vulnerabilities that cybercriminals can exploit.
• Educate your employees on cybersecurity best practices, such as not clicking on suspicious links or sharing login credentials, and encourage them to report any suspicious activity.

Following these best practices and focusing on third-party risk can significantly strengthen your business’s IT environment and protect your organization against cyber threats. However, regularly assessing your IT environment can take time away from your business. Clearview helps identify opportunities for improvement in your business’s IT internal control programs, processes, and infrastructure. If you think your business could benefit from an IT Audit, contact Fawzi Habib (fhabib@clearviewgroup.us).