![]() ![]() ![]() For example, third-party risk management is the process of controlling activities that could potentially lead to positive or negative results due to outsourcing specific functions and processes to outside parties. What is third-party risk management (TPRM)?.An effective TPRM policy should answer the following questions listed below. ![]() To combat those risks, effective institutions implement corporate-wide policies such as a TPRM policy to ensure that the entire enterprise understands the importance of considering risk when choosing to use outside third-parties to complete key functions and processes. Despite the various advantages associated with outsourcing, there exist various risks that could undermine an organization’s efforts to maximize the benefits of utilizing third-parties. Outsourcing to third-parties such as vendors and suppliers allows organizations to improve the efficiency of their functions and processes and as a result increase their profitability through decreased operational costs. For more information about TPRM, please refer to the Beginner's Guide to Vendor, Supplier and Third-Party Risk Management.ĭue to stringent regulations regarding outsourcing, many institutions are implementing third-party risk management (TPRM) programs to ensure that third-parties meet their strategic objectives. ![]()
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