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Third-party security posture refers to how strong your third-party cybersecurity is and its ability to proactively defend against, mitigate, and respond to attacks.

Many organizations today give their third parties access to critical data, so the security of these third parties and their ability to handle data securely can directly impact your organization, potentially leading to data breaches, ransomware attacks, and other security incidents.

Building a strong third-party security posture is challenging due to the increased outsourcing of IT services, which makes it harder to gain visibility into the supply chain and prioritize risks accordingly.

The dynamic nature of IT technologies and cybersecurity risks highlights the importance of continuous monitoring to ensure a strong security posture for both you and your third parties over time.

Additionally, many organizations lack the resources needed to build a strong third-party security posture, such as TPRM technology and teams.

Having a strong third-party security posture delivers many benefits.

It strengthens overall resilience, minimizing cyber risk and ensuring that your business can continue to offer services even in the event of an attack.

It also builds your reputation and trust with customers by reducing the risk of impact from attacks and ensuring compliance with regulations and standards like DORA, NIST CSF, NYDFS, and the NIS2 Directive.

To assess your third-party security posture, you need to follow several steps.

First, take inventory of all third parties to understand which vendors are in your supply chain.

Many organizations find it challenging to identify their third parties at any given time, so they turn to a third-party risk platform that automatically detects third parties and offers full supply chain visibility.

Next, identify and classify the data shared with each vendor to determine the level of security needed to protect it.

Conduct third-party risk assessments for each vendor, including security questionnaires, attack surface assessments, on-site audits, penetration testing, and adherence to relevant industry regulations and standards.

Evaluate compliance with regulatory standards and frameworks, such as GDPR, NYDFS, PCI DSS, HIPAA, and ISO 27001.

Determine the effectiveness of your third party’s security controls, including internal policies, procedures, and technical controls.

Regularly evaluate third-party security controls, incident response preparedness, and contingency plans for continuing business operations in the event of an attack.

Ongoing monitoring is crucial to ensure continued resilience, as networks, systems, and the cybersecurity landscape are constantly evolving.

Employee training and awareness are crucial elements of security posture.

Most cybersecurity threats result from human error, so continuous employee training on the latest social engineering techniques can better equip them to recognize and respond to these threats.

Regulations like PCI DSS, HIPAA, and GDPR require regular employee cybersecurity training to maintain the security standards needed to protect sensitive data.

Effective incident response also includes preparation and an understanding of each employee’s role in the event of a security incident.

Regular training helps facilitate a culture of security-first awareness within your organization, which can be influential in dealing with third parties.

Assessing third-party security posture presents several challenges.

The increased reliance on and outsourcing of services to third parties has resulted in businesses switching vendors frequently, making it harder to identify vendors and their role in the supply chain at any given point in time.

The dynamic nature of networks means that a simple upgrade or reconfiguration introduces vulnerabilities in your third parties.

Continuous monitoring is required to have real-time information, but not all vendors have the technology and resources for this.

Traditional tools used to strengthen security posture against third-party risk are often ineffective.

Vendor security questionnaires can be cumbersome and not relevant to every third party, and traditional security rating services may not assure compliance with internal security policies and practices.

Organizations need tools that provide context, visibility, and engagement to address today’s challenges.

These tools should identify and measure different third-party relationships and the level of risk they present, verify internal security policies, and offer a collaborative approach to remediate security gaps.

Traditional cyber risk ratings assess an organization’s security posture but do not include an assessment of its third parties and their individual business relationships.

These ratings typically rely on externally observable information and do not properly assess adherence to internal security requirements.

An accurate cyber risk rating is crucial for aligning third parties with security controls and internal policies to mitigate cyber risk effectively.

Panorays’ cyber risk ratings include hundreds of tests in categories of three different layers for each third party: Network and IT, Application, and Human.

These tests identify flagged company assets, verify DNS configuration, assess applications and services, test resilience against domain hijacking, and evaluate the security awareness and digital footprint of company employees.

The platform includes an asset discovery mechanism, continuous monitoring, and non-intrusive assessment to ensure accuracy.

The Panorays Cyber Risk Rating is composed of test entities, with results generating findings and a test rating.

The final risk rating reflects an aggregation of the total tests for each category, resulting in scores for each layer.

This comprehensive approach helps organizations strengthen their third-party security posture.

In summary, security posture in cybersecurity refers to your organization's ability to defend, mitigate, and respond to cybersecurity threats.