In today’s digital landscape, cybersecurity is no longer just a concern for IT departments; it’s a critical component of business operations. With cyber threats evolving and becoming increasingly sophisticated, organizations must not only prioritize their own security measures but also engage in transparent discussions about their cybersecurity preparedness with vendors.
Whether you’re a small business owner, a corporate executive, or a freelancer, understanding the significance of discussing cybersecurity preparedness with your vendors is paramount in safeguarding sensitive data, maintaining trust, and mitigating potential threats. Below, we’ll unravel the complexities of cybersecurity talking points to empower you to navigate these crucial conversations with confidence.
How to Ensure Your Vendors Comply with Cybersecurity Expectations
In excerpts from an article by VenMinder, they wrote, “While cybersecurity became important the moment we decided to store and send our sensitive information online, last year underscored just how critical it really is. The pandemic unveiled an alarming number of weaknesses in many of our systems, processes and procedures, and bad actors came out of the woodwork to take advantage.
Add to that how the scope of vendor management is expanding, and undoubtedly one of the primary focal points for examiners will be vendor cybersecurity preparedness. So, the questions are, do you know where to start to review your vendors’ cybersecurity expectations and have you thoroughly reviewed your vendor’s cybersecurity preparedness? Many organizations find this both overwhelming and confusing, but the good news is we’re here to help break it down.
2 Critical Steps to Ensuring Vendor Cybersecurity Compliance
Step 1: Evaluating the Issues at Play
The first step in ensuring your vendor is adequately complying with cybersecurity regulations is understanding the landscape itself. Two key factors here are:
1. Satisfying Regulators. The main question is how your vendors will comply with the increased focus on cybersecurity. It’s not enough for you to simply ask your vendors once a year if they’re checking the cybersecurity box, and you most certainly can’t assume or just take their word that they have it covered. The key to making sure you’re crossing your t’s and dotting your i’s when it comes to regulators, and your vendors are too, is understanding specific compliance rules and standards in the industry.
Let’s take a look at few examples:
- Healthcare. The healthcare industry must comply with the Health Insurance Portability and Accountability Act (HIPAA).
- Cards/Payment Processing. Vendors that perform payment processing on your behalf will need to comply with Payment Card Industry Data Security Standard (PCI DSS) requirements.
- Financial Institutions. FIs in the US are required to comply with the Gramm-Leach-Bliley Act (GLBA) Meanwhile, the Financial Industry Regulatory Authority (FINRA) requires US broker-dealers to have written data protection policies to protect consumer data and outlines rules for detecting and managing potential cyber threats.
- Region specific. Organizations that have international business relationships with other individuals or organizations within the European Union must toe the line with the EU General Data Protection Regulation (GDPR), and certain organizations with clients in California must comply with the California Consumer Privacy Act (CCPA).
2. Protecting Your Future. You’ll need to ask yourself when evaluating your vendors’ processes what is the true cost of incomplete or poor compliance standards and, if their processes aren’t as up to par as they should be, determine how that could impact your organization. When (not if) a cyber event happens, here’s what you need to consider:
How much will it cost your organization in dollars, reputation, lawsuits and lost customers? Once you have an understanding of what your vendor is responsible for from a regulatory perspective, and you’ve ensured they’ve established the importance of cybersecurity compliance from a program-perspective, you’re ready to evaluate further how prepared they are.
Step 2: Determine The Vendor’s Preparation
To fully prepare they’ll need to have:
1.Clearly understood the risks they may pose your organization, how they’re addressing those as well as inherent risk their vendors pose. Organizations need a solid methodology to identify inherent risk from cyber threats. This includes defining the following:
- Connection Types
- Products and Services Offered
- Technologies Implemented
2. Ensure they have proper processes in place to secure data and understand what is subject to compliance. We’ve covered just a few of the specific compliance requirements by industry and region, but you’ll also need to know what specific kinds of information are regulated. Some of the major players include:
- Personally Identifiable Information (PII). This includes information such as first and last name, date of birth and social security number.
- Protected Health Information (PHI). PHI may include medical history, admission and/or prescription records as well as data around insurance or appointments.
- Financial data. Social security numbers, credit and debit card numbers as well as credit history and ratings are among protected financial data.
- Miscellaneous data. Additional sensitive information may include race, marital status, religion, email addresses and/or passwords as well as IP addresses and biometrics.
Confirmed they have adequate controls in place. Once a solid understanding of inherent risks and data types have been identified and documented, your vendor needs to focus on mitigating risk by implementing additional controls. Understanding whether or not your vendor is conducting a regular third-party audit of their controls to verify that their organization demonstrates it has the proper people, processes and technology in place to sufficiently protect your data is important.
You don’t want to risk not knowing if a vendor isn’t complying with cybersecurity expectations. Not only can their faulty process put your organization at risk, but it can lead to costly fines and lawsuits. The amount of data organizations manage is increasing all the time… and, as we touched on briefly, the complexity of regulations is growing too. When in doubt, break it down: your vendors should understand the risks, be researching the industry standards, creating a plan and leveraging assistance!”
9 Questions to Ask Vendors About Their Cybersecurity
In excerpts of an article by ITS, they wrote, “How can you stop your business from joining the list of organizations with breached data due to third-party negligence?
When evaluating new vendors, going beyond the surface level and delving into their cybersecurity practices is essential. Asking the right questions can provide valuable insights into their approach to protecting data and mitigating potential risks.
We’ve prepared this article to delve into the questions you should ask new vendors before partnering with them. By doing your due diligence and asking these questions, you’ll have the information to make informed decisions and establish a secure vendor ecosystem.
1. How is your data protected?
The first question to ask is about their data protection policies. Asking a vendor how their data is protected allows you to evaluate the risk associated with their services.
Vendors should be able to explain if their data is encrypted, if they provide Transport Layer Security (TLS), and what their data security protocol looks like. Some signs a company knows what they’re doing is:
- If they mention a cybersecurity framework
- If they have endpoint security and firewall implementation
- If they have dedicated cybersecurity personnel
Any company that cannot clearly explain its data security guidelines should be put at the bottom of the list of your considered partners.
2. Do you follow government cybersecurity guidelines?
After asking about their data protection policies, ask your future vendor if they follow any government cybersecurity guidelines. Some guidelines your vendors should follow are:
- HIPAA(if they work in healthcare)
- ISO 27701(if they manage any sensitive customer information)
- PCI-Level 1(if they store credit card data)
- SSAE 16(if they work in the financial sector)
Each vendor may have unique regulations based on their field; while some vendors don’t have required government security policies, good vendors will still follow these rules.
***Please note: These are American standards. For Canadian (or other country) guidelines, please check with your local Government Cyber Security Laws, Standards, and Best Practices.
3. How and where is data stored?
Next, ask your potential vendors how and where their data is stored. You can assess a vendor’s overall reliability by asking a vendor how and where their data is.
For example, companies that only store their data on-site are at risk of server outages. Companies with solely off-site data are at higher risk for security breaches – especially if they don’t have the proper security infrastructure.
Vendors who store data on and off-site are a much better bet.
4. Who will own this data if we stop using you as a vendor?
After asking about their data management, it’s time to ask about data ownership. Understanding who owns what data is crucial in making informed decisions about future data usage, transfer, or deletion.
Depending on your field and the type of data you store, you might also have intellectual property considerations when partnering with a vendor. If you clarify data ownership, you can sidestep future issues about proprietary and confidential information.
5. What is your backup procedure?
This question is a sneak peek at their preparedness in case of outages. It also helps you evaluate if your data will always be available.
The vendor should keep their physical and cloud storage separate, as this ensures critical data remains intact even if their hardware somehow gets corrupted. Having a physical backup, on the other hand, can help restore their system as soon as possible in case of incidents like ransomware.
6. What are your incident, business, and disaster recovery plans?
Disaster recovery, business continuity, and incident response plans are all different programs your vendor should have.
A cybersecurity-prepared vendor will be able to explain each plan to you in detail, and their answers are vital for assessing their preparedness.
They should also mention implementing routine disaster recovery tests. If they have the foresight to run these plans before security incidents happen, then your data is probably in the hands of a good company.
7. Do you support multi-factor authentication (MFA)?
Multi-factor authentication (MFA) is an essential security measure all companies should have with their accounts. But you’d be surprised at the number of vendors that don’t have MFA enabled.
By asking this question, you can easily see if a company stays on top of even the small details of cybersecurity.
8. Is your platform externally audited?
No matter how thorough you are, it’s still possible to make mistakes. If you ask about external audits, and your vendor says they have external auditors, then you know they care enough to be thorough with their cybersecurity.
9. What are your partners’ security protocols?
Lastly, you need to ask about your vendor’s partners. Do their vendors have robust security protocols? Do their vendors have access to your data?
Vendors often rely on their network of third-party service providers, increasing the potential attack surface.
Understanding how they manage and assess the security risks associated with these third parties demonstrates their commitment to maintaining a secure ecosystem.”
How to Manage Vendor Cybersecurity Risk
In excerpts from an article by Venminder, they wrote, “Third-party data breaches can have severe financial and reputational consequences, so mitigating vendor cybersecurity risks that threaten your organization is crucial.
Managing your third-party cybersecurity risks isn’t a small feat. First, when deciding on a strategy to manage cybersecurity, it may be beneficial for third-party risk management and information security teams to work together.
Additionally, here are six tips for effectively mitigating your vendor cybersecurity risks:
- Establish a list of your vendors that have access to your information or systems. It’s impossible to manage the unknown, so maintaining an updated list of all your vendors is a critical first step.
- Remember, cyber risk isn’t one-size-fits-all. Categorize your vendors according to sensitivity of the information and systems they have access to.
- Establish levels of review and frequency of monitoring based on the amount and type of vendor risk. Take into consideration factors such as the vendor’s access to your information or systems and the sensitivity of that information to determine the depth and occurrence of reviews.
- Perform ongoing monitoring activities to ensure you stay on top of evolving cyber risks. Malicious actors continue to update their threats and methods to overcome new defenses, so ongoing reviews are essential to determine whether your vendors are prepared for emerging threats.
- Establish a list of your vendor’s vendors, known as fourth parties/subcontractors, that process or have access to your data or systems. Here are 3 reasons why:
- It’s increasingly common for companies to outsource parts of their processes. As the list of entities that have access to your information increases, so does your risk.
- It helps to ensure that your vendors take this critical step of monitoring their own vendors.
- If the sensitivity of the data or the access to your systems and infrastructure is high, then it may make sense that you verify the cybersecurity measures in place for fourth-party vendors.
When it comes to cybersecurity risks, you can’t be too careful. As third-party data breaches and other cybersecurity incidents threaten your organization, it’s necessary to maintain best practices to protect your organizations and customers’ sensitive data. By collaborating with internal teams and following these six tips, you’ll be on track to protecting your organization from vendor cybersecurity risk.”
The rapidly evolving landscape of cybersecurity demands that organizations prioritize transparent discussions about cybersecurity preparedness with vendors. This article has underscored the critical importance of proactive engagement in addressing cybersecurity concerns, emphasizing the need for open communication, thorough evaluation, and effective risk management strategies.
From understanding regulatory compliance requirements to assessing vendor cybersecurity practices, organizations must take decisive steps to safeguard sensitive data, maintain trust, and mitigate potential threats. By initiating discussions about cybersecurity preparedness, asking the right questions, and implementing robust risk management measures, businesses can enhance their resilience against cyber threats in an increasingly digital world.
Ultimately, whether you’re a small business owner, corporate executive, or freelancer, being prepared to discuss cybersecurity with your vendors is not just a best practice – it’s a fundamental aspect of modern business operations that can protect your organization’s assets, reputation, and future success.
At Adaptive Office Solutions, cybersecurity is our specialty. We keep cybercrimes at bay by using analysis, forensics, and reverse engineering to prevent malware attempts and patch vulnerability issues. By making an investment in multilayered cybersecurity, you can leverage our expertise to boost your defenses, mitigate risks, and protect your data with next-gen IT security solutions.
Every device connecting to the internet poses a cyber security threat, including that innocent-looking smartwatch you’re wearing. Adaptive’s wide range of experience and certifications fills the gaps in your business’s IT infrastructure and dramatically increases the effectiveness of your cybersecurity posture.
Using our proactive cybersecurity management, cutting-edge network security tools, and comprehensive business IT solutions, you can lower your costs through systems that are running at their prime, creating greater efficiency and preventing data loss and costly downtime. With Adaptive Office Solutions by your side, we’ll help you navigate the complexities of cybersecurity so you can achieve business success without worrying about online threats.
To schedule a Cyber Security Risk Review, call the Adaptive Office Solutions’ hotline at 506-624-9480 or email us at helpdesk@adaptiveoffice.ca