Third-Party RiskAssessment Framework
Comprehensive framework for assessing and managing third-party data processing risks under DPDPA 2023, ensuring vendor compliance and protecting organizational data assets.
Key Risk Categories
Primary risk areas to evaluate when assessing third-party data processors
Data Processing Risks
Assess third-party data handling practices and security measures
- Unauthorized data access or disclosure
- Inadequate encryption and security controls
- Non-compliant data retention practices
- Insufficient access controls and monitoring
Compliance Risks
Evaluate third-party DPDPA compliance capabilities
- Non-compliance with DPDPA requirements
- Inadequate consent management systems
- Missing data subject rights procedures
- Insufficient breach notification processes
Operational Risks
Assess third-party operational reliability and continuity
- Service availability and continuity issues
- Data recovery and backup failures
- Inadequate incident response capabilities
- Vendor lock-in and exit planning risks
Assessment Framework
Structured approach to third-party risk assessment and management
1
Due Diligence
2-3 weeks
Key Activities
Third-party security questionnaires
Compliance documentation review
Security certification verification
Reference and reputation checks
Deliverables
Due diligence report
Risk assessment matrix
Compliance gap analysis
2
Contract Negotiation
1-2 weeks
Key Activities
Data processing agreement drafting
Security and compliance clauses
Liability and indemnification terms
Audit rights and monitoring provisions
Deliverables
Data processing agreement
Security schedule
Monitoring framework
3
Ongoing Monitoring
Continuous
Key Activities
Regular security assessments
Compliance monitoring and reporting
Incident response coordination
Performance and SLA monitoring
Deliverables
Monthly monitoring reports
Annual compliance reviews
Incident response logs
Assessment Criteria & Scoring
Weighted criteria for comprehensive third-party evaluation
Security Controls
30%- Data encryption in transit and at rest
- Access controls and identity management
- Network security and monitoring
- Vulnerability management programs
DPDPA Compliance
25%- Data subject rights implementation
- Consent management capabilities
- Breach notification procedures
- Privacy by design principles
Data Governance
20%- Data classification and handling
- Retention and deletion policies
- Data transfer and sharing controls
- Audit trails and logging
Business Continuity
15%- Backup and recovery capabilities
- Disaster recovery planning
- Service level agreements
- Exit and transition planning
Certifications
10%- ISO 27001 certification
- SOC 2 Type II reports
- Industry-specific certifications
- Regular third-party audits
Risk Mitigation Strategies
Tailored mitigation approaches based on assessed risk levels
High Risk
Enhanced Due Diligence
On-site security assessments
Detailed technical reviews
Executive-level compliance commitments
Quarterly monitoring and reporting
Medium Risk
Standard Monitoring
Annual compliance reviews
Regular security questionnaires
Incident reporting requirements
Semi-annual performance reviews
Low Risk
Baseline Controls
Annual self-assessments
Standard contract terms
Incident notification requirements
Annual relationship reviews