Third-party risk control is insufficient. In 2021, the company will turn its emphasis to third-party GRC management.
Fremont, CA: The business world in 2021 is distributed, complex, and disrupted. It is dispersed through a network of relationships. It is complex because businesses and relationships change on a daily basis. Processes evolve, workers evolve, relationships evolve, laws evolve, threats evolve, and goals evolve. The business relationship environment is nuanced and interconnected, necessitating a comprehensive, contextual awareness of third-party GRC rather than a disjointed array of processes and departments. Change in one environment has a domino effect on the whole ecosystem.
Because of the interconnectedness of industry, there is a growing need for 360° contextual understanding in the organization's third-party relationships. Each partnership requires organizations to see the nuanced intersection of goals, threats, and boundaries. The days of simple operations are long gone. Third-party partnerships and the company's ability to handle them are hampered by exponential growth and shift in risks, legislation, globalization, dispersed operations, competitive velocity, technology, and business data.
Notable Trends in Third-Party GRC in 2021:
Integrity: The organization's credibility is dependent on the integrity of its third-party partnerships. In 2021, organizations will re-evaluate their internal core principles, ethics, and standards of behavior, as well as how they apply and are applied through third-party partnerships. This includes a focus on human rights, privacy, environmental standards, health, safety, interactions with others (e.g., customers, partners), and third-party relationship protect.
Resiliency: The organization has to maintain operations amid uncertainty and change. This requires a holistic view of third-party relationships' objectives and performance in the context of uncertainty and risk within those relationships. The organization in 2021 has to be a resilient organization with full situational awareness of the interconnected risk environment that impacts them. Given the organization's dependence on third-party relationships, this necessitates a comprehensive examination of the governance, risk management, and enforcement of each third-party relationship and how it serves and offers value to the organization.
Governance: Third-party risk control is insufficient. In 2021, the company will turn its emphasis to third-party GRC management. It all begins with relationship governance. The purposes and sub-relationships of the relationship must be clearly described and controlled. Danger and ambiguity in the sense of the partnership to deliver those goals can be handled only after a clear understanding of the objectives and the governance of those objectives. To ensure greater risk, resiliency, and dignity in those relationships in 2021, the company will need to adopt a more assertive approach to relationship governance.