The Okta and MOVEit supply chain attacks highlighted the challenge vendors have in securing their vendors and third parties. Increasingly, outsourcing to fourth and even fifth parties have created more complex supply chains, there is a greater reliance on vendors for critical services, and the threats are evolving at a rapid pace. Up to 60% of attacks now involve the supply chain, and according to Kaspersky, it has become the most frequent attack vector in 2023.

An important tool for organizations to assess vendor and third-party risk related to these types of attacks is a cybersecurity questionnaire.

Purpose of the Cybersecurity Questionnaire

A cybersecurity questionnaire is a risk assessment tool that identifies and mitigates any security issues in a current or new business relationship with a vendor. These can include questions that evaluate the vendor’s ability to adhere to compliance, the effectiveness of the security controls it has in place, current risk mitigation strategies and its ability to respond in the event of an attack or security breach. 

Cybersecurity questionnaires are different from a vendor questionnaire in that they focus on cybersecurity. A vendor questionnaire is broader in scope, and may include questions related to business continuity and operational, legal, financial and strategic risk.

Why is it Important to Use a Security Questionnaire?

Security questionnaires enable an organization to identify risk in entering a potential business relationship and decide that finding an alternative supplier would be a better solution. Or it could be used to discover a way to mitigate the risk and continue with that business relationship. By evaluating its adherence to compliance and current security policies and even third-party management policies, it minimizes the risk of a data breach or other security incident from this vendor or third party. For this reason, it is a crucial tool for organizations doing due diligence on the security of their vendors and third parties and an important part of a comprehensive TPRM program.

What Topics Does a Security Questionnaire Cover?

  • Internal risk management policy 
  • Third-party risk management policy
  • Frequency and effectivity of employee training
  • Business continuity plan and disaster recovery of the vendor in the event of an attack
  • Business resiliency plan of the vendor to proactively defend against operational disruptions in advance
  • Ability to detect unauthorized access to data
  • Time organization is required to notify customers in the event of a breach or security incident
  • Data encryption methods both in-rest and in transit
  • Compliance with data privacy regulations
  • Security adjustments for office and remote work 
  • The adherence of specific regulations relevant to the vendor or third party (e.g. HIPAA, PCI DSS or GDPR)
  • Identification and process for vulnerability and patch management
  • Data protection and data privacy management
  • Application and cloud security
  • Controls in place for protection of data centers, servers, and physical offices

Creating an Effective Security Questionnaire

An effective security questionnaire starts with a goal: What are the risks the organization is seeking to minimize as they would create the biggest impact and operational disruption if they occur? Security questionnaires should be based on identifying these critical risks and developing questions designed to evaluate the potential of those risks. They should also be different for each industry, type of organization, and employee role.  For example, vendors should receive different questions than third-party vendors, and cloud-based service organizations should have more questions related to cloud security. HR managers should not receive questionnaires that are as technical as IT managers.
Security questionnaires are also only valid for a specific point in time, as the answers to the questionnaire change based on network dynamics, evolving risks, and third-party supply chains. For this reason, security questionnaires are only effective when they are conducted on a regular basis.

Industry-Standard Cybersecurity Questionnaire

Frameworks exist, such as the NIST framework, that organizations can use as a foundation for their cybersecurity questionnaires. For example, they can structure their questions around the five NIS core functions: Identify, Protect, Detect, Respond, and Recover, with categories and subcategories under each function. The NIST CF includes standards for third-party risk management.

The ISO 27000 series framework includes security controls for your information security management system (ISMS) and is specific to third-party risk management. Organizations can align their cybersecurity questionnaires similarly to how they would with the NIST framework, based on clauses and controls within the framework.

Many questionnaires have templates that function as questionnaires for their industry. For example, the Consensus Assessments Initiative Questionnaire (CAIQ) is a set of yes or no questions designed to evaluate 133 control objectives structured across 16 domains that cover key aspects of cloud technology. It is designed to measure an organization’s compliance with the Cloud Controls Matrix (CCM), which is the CSA’s cybersecurity control framework. The Standardized Information Gathering Questionnaire (SIG) is a repository of third-party information security and privacy questions indexed to multiple regulations and control frameworks. For example, the SIG Core Questionnaire is a set of 855 questions that encompass all 19 risk controls.

Major Compliance Requirements for Cybersecurity Questionnaires

Another important aspect of a cybersecurity questionnaire is its ability to evaluate the vendor or their party’s adherence to compliance. Many organizations are required to meet specific compliance in their industry, such as HIPAA compliance for healthcare organizations and NYDFS for financial organizations either located in or dealing with customers in the New York State area. Many regulations also have specific requirements, such as mandatory penetration testing, employee awareness training, reporting data breaches to customers within a specific amount of time, and maintaining comprehensive records of all efforts related to compliance.

Recently, regulations such as DORA, NYDFS and the NIS Directive have included adherence of not just the organization but their third parties. In addition, regulatory bodies are starting to develop regulations focused on enforcing the ethical and response use of artificial intelligence in technologies.

Create a Custom Security Questionnaire

Since many aspects of cybersecurity are depending on the vendor, the industry, the relevant regulations, the evolving technology and threat landscape – and the critical risks the organization is mitigating against – security questionnaires must be customized for each vendor. They must also align with different, and often evolving, business goals for each organization. In addition, different vendors and third parties have different access to sensitive data and therefore demand different questions based on how it interacts with this data.

Due to the dynamic nature of IT infrastructure, third party and vendor outsourcing of services, and evolving cybersecurity threats, these security questionnaires should be updated regularly to stay as accurate as possible.

Automate the Cybersecurity Questionnaire Process

Customizing cybersecurity questionnaires for each vendor manually can be quite tedious. Automating the process allows organizations to easily scale the process while at the same time maintaining the flexibility needed to adapt to changes when necessary. In addition, these capabilities can be easily integrated with the collection of data and its analysis in real time, as well as risk management, security and compliance tools.

Automation also frees up organizational resources to allocate them to higher value tasks, such as mitigating incidents in real-time. Additional benefits of automating cybersecurity questionnaires is that it ensures greater accuracy as it eliminates human error, and facilitates greater communication between teams with real-time alerts, updates and collaboration tools.

Are Security Questionnaires Enough on Their Own?

Since security questionnaires are only one type of risk management tool, they only deliver a specific view of certain aspects of vendor security. They should be used in conjunction with a comprehensive risk management that includes the use of a third-party risk management platform.

Panorays is a third-party management platform that delivers contextual cyber management customized for each business relationship. By mapping the full threat landscape and continuously monitoring and reassessing the Risk DNA of each business connection, we pinpoint early threats indications within the unique business context of every relationship, enabling companies to adapt their defenses, minimize risk and proactively prevent the next breach from affecting their business.

Risk DNA includes accurate external assessments that map and analyze third party digital assets for vulnerabilities and control failures, breach history, human risks (such as compromised credentials) and KEVs alone with other details. External assessments are then combined with internal assessments that include dynamic cybersecurity questionnaires customized according to the company profiling and risk tolerance. These AI-powered cybersecurity questionnaires supply answers to questions based on vendor documentation (SOC2, certifications and external public assets) to validate all responses. Together these assessments deliver the most accurate cyber rating on the market for each of your third party relationships. 

Ready to learn more about automated cybersecurity questionnaires customized for each vendor relationship? Get a demo of our third party risk management platform today.

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