In the past month alone, big names like Hertz, WK Kellogg, and DBS Bank have all reported serious data breaches. But these attacks weren’t the result of flaws in their own systems. Instead, attackers exploited weaknesses in their software supply chains—targeting third-party vendors to get in.
This kind of breach is becoming less of an outlier and more of a pattern. According to recent research, 61% of companies experienced a third-party data breach in the last year.
And while the breach might start with a supplier, the fallout doesn’t stop there. Legally and reputationally, it’s the affected company that takes the hit. Customers don’t care whether the breach came from your system or someone else’s—they just know their data was exposed.
For businesses, that means the perimeter is bigger than it used to be. You’re not just defending your own network anymore—you’re responsible for the entire ecosystem that you’re connected to.
The challenges of third-party risk management
SaaS providers and vendors have become a go-to target for attackers—and it’s not hard to see why. These companies handle massive volumes of sensitive data across multiple clients, making them a high-value entry point. If a threat actor can compromise just one, they may gain access to dozens of organizations downstream.
But being a target doesn’t automatically mean a vendor will get breached. A strong cybersecurity program can make a big difference. The challenge is knowing whether that program actually exists—and whether it holds up under pressure.
Here’s why that’s often a challenge.
Too many vendors
Most organizations work with hundreds of third parties—from suppliers and SaaS platforms to consultants and contractors. The sheer volume makes it hard to keep track, especially as partnerships shift or evolve over time. Risk can change quickly, and staying ahead of it at scale is a real challenge.
Lack of visibility into third-party security
Many businesses don’t have a clear view of their third-party ecosystem or how those vendors manage security behind the scenes. Without transparency, it’s hard to catch vulnerabilities early or respond quickly when something goes wrong.
Inconsistent assessments
Even when organizations do try to evaluate third-party risk, the methods vary. Some vendors fill out security questionnaires. Others might provide audit reports or certifications. But these assessments are often point-in-time and self-reported, making it hard to know what’s accurate—or up to date.
Hidden dependencies
Sometimes the risk isn’t just with your vendor—it’s with their vendors. These fourth parties can introduce vulnerabilities you didn’t even know existed. Without a clear understanding of the full supply chain, these blind spots tend to go unnoticed until a security incident ushers them into the spotlight.
Building a successful third-party risk management program
Recognizing the challenges is only the first step. The real work lies in building a program that actively governs vendor risk, end to end.
Here’s how to do it.
1. Map your vendor ecosystem and assign ownership
Start by understanding exactly who your vendors are. That means logging every third party you work with—including SaaS platforms, contractors, service providers, and even one-off tools with access to your systems or data.
Next, assign clear internal ownership for each vendor. Someone — whether from IT, security, procurement, or legal—needs to be accountable for reviewing risk, monitoring access, and managing life cycle decisions.
2. Categorize vendors by risk
Not all vendors carry the same weight. A company that processes sensitive customer data or has direct access to internal systems poses more risk than a tool used for marketing automation. Group vendors into tiers based on how much access they have, what kind of data they handle, and how critical they are to your operations.
3. Define and standardize your onboarding process
Before onboarding any new vendor, there should be a consistent way to evaluate their security posture. That could include security questionnaires, reviewing SOC 2 or ISO certifications, assessing privacy policies, or running your own risk analysis.
This step should be codified into your procurement workflow. If you’re not using a centralized system, at a minimum, ensure teams have a checklist and clear documentation requirements before onboarding a new vendor.
4. Monitor vendor performance
Security assessments are only snapshots in time. To maintain visibility, you should implement tools for continuous monitoring—whether that’s automated alerts for vendor incidents, regular check-ins, or ongoing audits of high-risk suppliers.
If vendors are collaborating with internal teams in tools like Slack, Google Drive, or Microsoft Teams, that monitoring needs to extend into those environments. With Polymer, you can enforce data-sharing policies across these platforms in real-time—preventing unauthorized access and oversharing before it escalates.
5. Manage the full vendor lifecycle
Build checkpoints into the full vendor lifecycle: access reviews every quarter, contract renewal reviews annually, and secure off-boarding protocols when a relationship ends. Each of these stages should have defined owners, workflows, and documentation—so that vendor management remains proactive, not reactive.
6. Define an incident response plan that includes vendors
When a third-party breach happens, time is everything. Your incident response plan should include clear steps for communicating with vendors, assessing impact, and notifying customers or regulators if needed. Have communication protocols in place, and ensure vendors know what their obligations are (ideally spelled out in your contracts or DPAs).
7. Make reporting and auditability part of the process
Finally, good third-party data governance creates a trail. You should be able to generate reports on which vendors have access to what data, when they were last reviewed, and how they were categorized. This is critical for internal audits, compliance checks, and board-level risk reporting.
Ensure your third-party relationships are secure. Protect your sensitive data and minimize supply chain risk with Polymer. Request a demo today.
