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By Craig Davies, Chief Information Security Officer, Gathid.
The security of any organization’s data and systems can often be compromised by seemingly benign entities—third-party contractors, vendors and outsourced service partners. While these external entities require access to sensitive systems and data to fulfill their roles, improper management of these access rights often leads to data breaches and other security incidents.
A February 2024 SecurityScorecard study (via Security magazine) highlighted the ongoing risks third parties pose in organizational security. It found that 98% of companies are connected to at least one third party that has suffered a data breach, and third-party attack vectors are responsible for 29% of all reported breaches.
This highlights the need for efficient and effective third-party risk management strategies to safeguard organizational assets.
Why Third-Party Access Auditing Is Essential
Third-party access auditing is a must for organizations using external vendors and contractors due to the security, compliance and operational implications involved. It helps safeguard the integrity, confidentiality and availability of an organization’s data and systems while serving multiple essential functions, including:
• Enhanced Security Posture: Auditing ensures that only authorized third-party entities can access sensitive systems. This controlled access helps prevent security incidents by monitoring activities for abnormal behavior.
• Regulatory Compliance: Compliance standards across regulated industries mandate control over data access. Regular third-party access audits ensure compliance with regulations like GDPR, HIPAA and SOX, documenting access specifics and preventing potential legal and financial repercussions.
• Operational Integrity: By enforcing access controls that align with the third party’s operational role, organizations can avoid unauthorized changes or disruptions that might affect business continuity. This approach supports the operational integrity of critical systems.
• Financial Stability: Effective third-party access auditing helps reduce the risk of security breaches and privacy incidents that could result in significant financial losses due to remediation costs, legal fees and potential fines. By proactively managing and auditing third-party access, organizations not only protect their data but also shield their financial health from the impacts of data breaches.
• Maintaining Trust And Reputation: Regular auditing reinforces stakeholder trust by demonstrating a commitment to data security. It helps prevent breaches that can lead to a loss of customer trust and reputational damage, thereby supporting ongoing business relationships and market reputation.
Key Steps In Auditing Third-Party Access
Given the potential risks associated with third-party access, organizations must proactively manage and audit these permissions. Here are five key steps to effectively audit third-party access.
1. Identify and catalog third-party accounts. These could range from vendor accounts in your enterprise resource planning (ERP) system to contractor accounts in your project management tools. It’s essential to list these accounts and detail their access levels and the data or systems with which they can interact.
2. Verify and validate access necessity. This involves reviewing the scope of access relative to the third party’s role and responsibilities. Access should be strictly based on the principle of least privilege, where third parties are given no more access than is absolutely necessary to fulfill their contractual obligations.
3. Understand third-party employee life cycle management. Engage with third-party entities to understand, in particular, how they handle access rights creation, modification and termination. This is vital because an oversight in deactivating an ex-employee’s access could lead to unauthorized access and potential security breaches.
4. Establish a regular audit trail. Implement a system such as an identity governance and administration platform to regularly audit third-party access. This includes logging all access events and reviewing them to detect any unauthorized or abnormal access patterns. The frequency of these audits should be based on the sensitivity of the accessed data and the third party’s track record.
5. Integrate third-party access into your overall security policy. Third-party access controls and auditing should be an integral part of an organization’s overall security policy. This policy control ensures that third-party access is subjected to the same security measures and scrutiny as internal access.
Red Flags In Third-Party Access
Organizations should watch out for certain red flags that might indicate misuse or mismanagement of third-party access rights.
• Generic Account Usage: Be wary of third parties using generic email accounts or shared logins, as they make it difficult to attribute actions to an individual user.
• Anomalous Access Patterns: Access at unusual hours, accessing unexpected data or excessive login attempts can all be signs of a compromised third-party account.
• Lack Of Offboarding Processes: Ensure there are processes in place not just for onboarding new third-party access but also for effectively offboarding them when their contract ends or changes.
A Business Imperative
Third-party access poses a significant risk often overlooked until a breach occurs. By implementing robust auditing practices, organizations can greatly mitigate this risk. The objective is not only to protect sensitive data but also to preserve the integrity of the IT environment and maintain the trust of customers and stakeholders. Understanding and managing third-party access is not just a security measure—it is a business imperative.
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