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Glossary › Fourth-Party Risk
What is Fourth-Party Risk
Fourth-party risk evaluates the controls, stability, and compliance posture of entities supporting the primary vendor. These downstream providers can introduce security, operational, or regulatory risk if they lack maturity. In TPRM, identifying and monitoring fourth-party ecosystems strengthens supply chain resilience.
FAQs
Is fourth-party risk usually monitored directly?
Often indirectly through contractual requirements.
Why is it increasing?
Vendors rely heavily on subcontractors and cloud services.
How can it be reduced?
Require disclosure, audits, and subcontracting controls.
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