Not to be confused with 3rd party risk, 4th party risk is the risk that companies and organizations assume when working with suppliers, outsourcers, licensees, agents and contractors who use subcontractors to manage part of their service. As in third-party risk, these fourth-parties exist outside of your organization but have direct or indirect access to your information through their relationship with your contractors. Managing 4th party risk can be difficult, since it involves understanding the requirements for management, monitoring and reporting mandated by regulations in your industry, establishing a dialog with third party vendors about how they are using and sharing your critical data, and identifying resources and platforms that may help you monitor these relationships.
Would you like to learn more about how your organization can better manage vendor risk? Visit our Vendor Risk Management page for more information.