Onboarding of new third parties is a key process for the firm and implementing procedures to ensure that the correct third parties are on-boarded is critical. It is an important part of your third party risk management program. It needs to be implemented consistently across the organization and this consistency is key to the long term evolution of your program.
Termination of the relationship with a third party is also very important and is often a focus for regulators. There are business processes focused on the addition of new vendors but the processes on termination often receive much less attention. Firms should have processes in place to identify when and how third parties should be terminated and to ensure completion of the procedures associated with the proper termination of the relationship. Again, to ensure consistency, these processes should be automated across the organization.
For more information on the other elements of a third party vendor risk management framework, click on the links below.
Identifying the risks created by your firm’s use of third parties
Defining your policies and procedures for monitoring third parties