Due diligence and security questionnaires have become staples of the vendor risk assessment process for third-party risk management (TPRM). However, as the cybersecurity landscape evolves, our tools must evolve, too. Due diligence questionnaires remain a necessary component but the overreliance on static security questionnaires has become a barrier to effective risk management.
The value of due diligence questionnaires
Due diligence questionnaires are designed to answer critical, relationship-specific questions.
- Scope of engagement: What data, systems, or services will the third party access?
- Compliance requirements: Are specific legal, regulatory, or contractual obligations tied to this relationship?
- Business impact: What is the potential operational or reputational risk if this third party is compromised?
These questions go beyond generic cybersecurity concerns, focusing on the unique aspects of the partnership. They help organizations understand the relationship and ensure that appropriate safeguards align with its specifics. Due diligence questionnaires are a necessary foundation for establishing trust and setting expectations.
The problem with security questionnaires
Security questionnaires often fall short. These standardized forms ask third parties to provide detailed information about their cybersecurity practices.
- How do they handle encryption?
- Do they’ve had recent audits?
- What are their incident response protocols?
While these are important topics, the format of traditional questionnaires introduces several issues.
1. Static and stale data
Security questionnaires provide a snapshot in time that quickly becomes outdated. A vendor might submit a completed questionnaire today, but their environment, controls, or threat landscape could change tomorrow.
2. Lack of context
These forms are often disconnected from the specifics of the relationship. For example, knowing that a vendor uses encryption is less relevant if the relationship doesn’t involve handling sensitive data.
3. Inefficiency
Completing and reviewing lengthy questionnaires is time-consuming for both parties, creating bottlenecks that slow down procurement and vendor risk assessments.
4. Checkbox mentality
Organizations may treat completed questionnaires as a substitute for meaningful engagement, creating a false sense of security without truly understanding the risks.
5. Expertise of analysts
Questionnaires are typically developed by the staff at the requesting organization. The staff may lack the expertise to evaluate control selection or even the ability to interpret the results/responses to the questions.
A better approach to TPRM
To move forward, organizations must reimagine the role of questionnaires in TPRM.
1. Use due diligence for context
Focus on due diligence to capture relationship-specific insights. These questions matter most for tailoring your risk management approach to the specific vendor or partner.
2. Replace static questionnaires with dynamic assessments
Instead of relying on static forms, leverage real-time threat intelligence, continuous monitoring, and assessments that incorporate threat data into the control selection to understand a vendor’s security posture.
3. Focus on collaboration, not compliance
Engage with third parties to address risks collaboratively. Move beyond filling out forms to having meaningful discussions about risks, mitigations, and shared goals.
4. Streamline where possible
Adopt frameworks and framework bodies that actively collaborate on reciprocity to reduce redundancy and streamline the process for vendors managing multiple client requests.
The bottom line
Due diligence questionnaires remain a vital part of TPRM because they provide relationship-specific details needed to assess and manage risks effectively. Security questionnaires, however, need a modern overhaul. By transitioning from static, checklist-driven approaches to dynamic, real-time methods, organizations can focus on what truly matters: building resilient partnerships that mitigate risks and enable business growth.
It’s time to retire the outdated questionnaire model and embrace a more effective, efficient, and adaptive approach to TPRM. After all, managing third-party risks isn’t about ticking boxes — it’s about protecting your organization in an interconnected world.
