Sherlocked Security – Third-Party Risk Management (TPRM)

Mitigate Risks from External Partners and Suppliers by Strengthening Third-Party Risk Oversight

1. Statement of Work (SOW)

Service Name: Third-Party Risk Management (TPRM)
Client Type: Enterprises, Financial Institutions, Healthcare Providers, Government Agencies
Service Model: Project-Based Assessment, Retainer Advisory, Continuous Monitoring
Compliance Alignment: NIST 800-53, ISO/IEC 27001, PCI-DSS, GDPR, SOC 2, HIPAA

Third-Party Risk Management Service Covers:

Identification and classification of third-party relationships (e.g., vendors, partners, service providers)
Risk assessments of third-party security controls, data protection, and compliance posture
Vendor risk rating and categorization based on business impact and data sensitivity
Establishment of third-party security requirements, contracts, and SLAs
Ongoing monitoring and assessments of third-party security and compliance risks
Support for regulatory reporting and documentation related to third-party risk

2. Our Approach

[Third-Party Discovery] → [Risk Assessment & Evaluation] → [Vendor Classification] → [Security & Compliance Review] → [Contractual Alignment] → [Continuous Monitoring] → [Reporting & Remediation]

3. Methodology

Third-Party Discovery:
- Identify and catalog all third-party vendors, suppliers, and service providers across your organization.
- Classify third parties based on their access to sensitive data, critical systems, and overall business impact.
Risk Assessment & Evaluation:
- Perform risk assessments for each third-party relationship, focusing on security, compliance, financial, and reputational risks.
- Evaluate third-party security controls, data handling procedures, and regulatory compliance (e.g., GDPR, PCI-DSS).
- Assess the third party’s risk mitigation capabilities, including incident response, breach management, and business continuity planning.
Vendor Classification:
- Categorize vendors into risk tiers based on their potential impact on your organization.
- Apply a risk-based approach to prioritize higher-risk vendors and allocate resources for more in-depth assessments and due diligence.
Security & Compliance Review:
- Review the third-party’s security posture, including encryption, authentication mechanisms, patch management, and access controls.
- Evaluate third-party compliance with relevant regulations (e.g., HIPAA, GDPR) and industry standards (e.g., ISO/IEC 27001, SOC 2).
- Conduct assessments to ensure third-party vendors align with your organization’s security policies, data protection requirements, and confidentiality standards.
Contractual Alignment:
- Ensure that contracts with third parties reflect your organization’s security and compliance requirements.
- Draft or review security clauses in third-party contracts, including data protection measures, incident reporting, and audit rights.
- Establish service level agreements (SLAs) and performance metrics for vendor security and compliance.
Continuous Monitoring:
- Establish continuous monitoring procedures to track the ongoing security and compliance status of third-party vendors.
- Use automated tools to monitor vendor performance against SLAs, regulatory requirements, and security policies.
- Monitor for new risks emerging from the third-party environment, including changes in their security posture or compliance status.
Reporting & Remediation:
- Generate detailed reports outlining third-party risk assessments, security gaps, and compliance issues.
- Provide actionable recommendations for mitigating third-party risks, including vendor remediation plans, risk mitigation strategies, and process improvements.
- Track progress on vendor remediation efforts and ensure continuous alignment with security and compliance standards.

4. Deliverables to the Client

Third-Party Risk Assessment Report: Detailed report assessing the security, compliance, and financial risks of each third-party vendor.
Vendor Risk Classification Matrix: Categorization of third-party vendors into low, medium, and high-risk tiers, along with a risk profile.
Contract Review and Security Clauses: Reviewed contracts with third-party vendors, highlighting key security and compliance clauses.
Continuous Monitoring Dashboard: A dashboard for tracking third-party vendor performance, security posture, and compliance status over time.
Third-Party Remediation Plan: Actionable plan for addressing and mitigating third-party risks, including recommended actions and timelines.
Compliance Alignment Report: Detailed assessment of how third-party vendors align with relevant regulatory frameworks and industry standards.

5. What We Need from You (Client Requirements)

Third-Party Vendor List: A comprehensive list of all third-party vendors, service providers, and partners engaged with your organization.
Existing Vendor Contracts: Current contracts and service-level agreements (SLAs) with third-party vendors for review.
Security and Compliance Documentation: Any available documentation regarding third-party security practices, audits, and certifications (e.g., SOC 2, ISO 27001).
Data Flow Mapping: Documentation of how data is exchanged with third-party vendors, including access to sensitive data and systems.
Incident History: Information on any past security incidents, breaches, or compliance violations involving third-party vendors.
Stakeholder Interviews: Availability of internal stakeholders (e.g., procurement, IT, legal, compliance) for collaboration.

6. Tools & Technology Stack

Third-Party Risk Management Platforms:
- Prevalent, OneTrust, RSA Archer, MetricStream
Vulnerability & Security Assessment:
- Nessus, Qualys, Tenable.io, Rapid7 InsightVM
Compliance Tools:
- NIST CSF, ISO/IEC 27001 Framework, GDPR Assessment Tools, PCI DSS Compliance Tools
Contract & Vendor Management:
- DocuSign, Ironclad, Coupa
Continuous Monitoring & Analytics:
- SecurityScorecard, BitSight, UpGuard, RiskRecon

7. Engagement Lifecycle

Kickoff & Scoping: Initial meeting to understand the client’s third-party vendor landscape and define the scope of the engagement.
Vendor Discovery & Classification: Identify and classify third-party vendors, prioritizing those with the most significant access to sensitive data or critical systems.
Risk Assessment: Conduct detailed risk assessments for each third-party vendor, focusing on security, compliance, and operational risks.
Security & Compliance Review: Review third-party vendors’ security posture and regulatory compliance practices.
Contractual Alignment: Ensure that third-party contracts align with the organization’s security, compliance, and risk management requirements.
Continuous Monitoring Setup: Implement automated tools and processes for ongoing monitoring of third-party security and compliance.
Reporting & Remediation: Deliver risk assessment reports, vendor risk profiles, and provide actionable remediation steps for managing third-party risks.

8. Why Sherlocked Security?

Feature	Sherlocked Advantage
Comprehensive Third-Party Risk Assessment	Thorough analysis of vendor risks across security, compliance, and financial areas.
Automated Continuous Monitoring	Ongoing risk tracking and performance monitoring to ensure vendor compliance and security.
Regulatory Expertise	Deep knowledge of global compliance frameworks (e.g., GDPR, HIPAA, PCI-DSS) and industry standards.
Contractual Risk Mitigation	Review and drafting of vendor contracts with secure and compliant clauses to reduce risk.
Vendor Remediation Guidance	Actionable remediation plans to address identified third-party risks, improving overall security posture.

9. Real-World Case Studies

Financial Institution – Vendor Compliance Audit

Client: A major financial institution managing sensitive customer data.
Findings: Several third-party vendors had inadequate security controls, and some lacked necessary compliance certifications (e.g., SOC 2).
Outcome: Conducted a full audit of all vendors, categorized them based on risk, and implemented stronger contractual clauses to enforce security and compliance standards. Continuous monitoring was set up to track vendor performance, ensuring long-term compliance.

Healthcare Provider – Data Handling & Compliance Gaps

Client: A healthcare provider managing Protected Health Information (PHI).
Findings: A third-party vendor handling patient data was not fully compliant with HIPAA regulations and had poor access control mechanisms.
Outcome: Collaborated with the vendor to update their security practices and renegotiated the contract to include stronger data protection clauses. Developed a continuous monitoring plan to ensure ongoing HIPAA compliance.

10. SOP – Standard Operating Procedure

Initial Assessment: Review existing third-party relationships and categorize based on data access and business impact.
Risk Assessment: Evaluate third-party security posture, compliance status, and operational risks.
Contract Review: Ensure third-party contracts reflect security and compliance requirements.
Monitoring Setup: Establish monitoring tools to track vendor security and compliance performance.
Reporting & Remediation: Document findings, risk profiles, and develop remediation strategies for any identified issues.
Ongoing Monitoring & Audits: Conduct periodic reviews and audits to ensure that third-party vendors remain compliant and secure.

11. TPRM Readiness Checklist

1. Pre-Engagement Preparation

[ ] List of all third-party vendors and service providers
[ ] Existing contracts and SLAs with third parties
[ ] Security and compliance documentation from third parties (e.g., SOC 2, ISO 27001)
[ ] Data flow diagrams showing access to sensitive systems and information

2. During Engagement

[ ] Complete third-party risk assessments
[ ] Review vendor security practices, data protection mechanisms, and regulatory compliance
[ ] Categorize vendors based on risk level and business impact

3. Post-Engagement Actions

[ ] Continuous monitoring of third-party risk and compliance status
[ ] Track vendor remediation efforts and implement improvements
[ ] Ensure compliance with regulations and industry standards over time

Third-Party Risk Management