Managing Third-Party Risks: Comprehensive TPRM Strategies

Introduction:

Third-Party Risk Management (TPRM) involves controlling operational risks arising from interactions with suppliers, contractors, and other partners. As regulatory authorities increase their scrutiny of third-party risks, understanding and addressing these risks comprehensively becomes crucial. This course is designed to provide participants with a thorough understanding of TPRM, from defining its scope and building a framework to monitoring and managing TPRM processes. Participants will gain the skills to effectively identify, manage, and mitigate third-party risks, and will be prepared for TPRM certification.

Objectives:

By the end of this Third-Party Risk Management (TPRM) course, participants will:

• Understand the need for third-party risk management and the impact of third-party relationships without appropriate risk controls.
• Identify third-party-related roles and the specific threats they pose.
• Explain the main components of a third-party risk management system.
• Describe relevant regulatory aspects and terminology related to TPRM.
• Depict the stages of the TPRM lifecycle.
• Develop contingency plans for termination and exit strategies relevant to key outsourcing partners.

Training Methodology:

• Presentations
• Interactive reading using the case method
• Teamwork
• Role-plays and mock trials
• Seminars
• Dramatization
• Personal analysis
• Discussion and Q&A sessions

Course Outline:

Unit 1: Defining Third-Party Risk Management (TPRM):

• Overview and importance of TPRM
• Identifying relevant third parties
• Evaluation of third parties based on different segmentation

Unit 2: Identifying and Understanding Third-Party Risks:

• Nature of third parties in business objectives
• Types of impacts caused by third-party risks
• Risks from engaging third parties directly and indirectly
• Taxonomy of third-party risks
• Using Risk Bow Tie for risk analysis and mapping

Unit 3: A Third-Party Risk Management Framework:

• Application of ISO 31000 standards
• Integrating ISO 31000 elements into TPRM processes
• Addressing language and understanding barriers
• Risk management cycle: identification, analysis, evaluation, and treatment
• Continuous monitoring, review, documentation, and reporting
• Cultivating an integrated TPRM ecosystem

Unit 4: Compliance Requirements in TPRM:

• Operational TPRM compliance obligations:
  • Outsourcing
  • Modern Slavery
  • Anti-bribery and Corruption
  • Privacy & Protection of Personal Data
• Due diligence processes
• Integrating TPRM processes with compliance activities

Unit 5: Steps in TPRM: How to Map the Process:

• Evaluation criteria and processes for third parties
• Preliminary assessment and tiering approaches
• Performing initial due diligence
• Decision-making and approval processes
• Onboarding with legal frameworks
• Continuous oversight and management
• Handling performance issues
• Offboarding procedures
• Interactions with other managed risks (e.g., Cyber, Fraud, Technical, Data)
• Operational resilience practices

Unit 6: Initial Screening, Tiering, and Due Diligence:

• Essential components of screening and selection (Data protection and financial)
• Information sourcing: Internal vs. external agencies
• Risk appetite considerations
• Relevance of a vendor in the risk restructuring process
• Compliance requirements for due diligence
• Conducting due diligence for third parties

Unit 7: Ongoing Monitoring and Maintenance:

• Regular updates to due diligence documentation
• Ensuring compliance assurance
• Monitoring service level agreements and contract performance
• Continuous management, including third-party training
• Monitoring risk indicators and collecting information for alerts
• Risk escalation procedures and treatment
• Reporting and analytics methods