Third Party Risk Management (TPRM) is a business process used to identify, assess, and mitigate risks associated with engaging third parties. It is a proactive approach to managing the risks associated with outsourcing, vendor management, and other forms of external relationships. TPRM is an important component of a comprehensive risk management program, and is often seen as a key component of a company’s compliance program. The process typically involves identifying and assessing the risks associated with third parties, establishing controls to mitigate those risks, and monitoring the third parties to ensure compliance with those controls. The goal of TPRM is to protect the company’s reputation, assets, and operations from potential risks associated with third parties. It is important to note that TPRM is not a one-time process, but rather an ongoing process that should be regularly reviewed and updated to ensure that risks are properly managed.
