What is the role of leadership in third-party risk management?

What is the role of a leader? We can say that they are not only for making decisions, but for setting priorities, influencing behaviors, and directing the culture of the entire organization.

Therefore, when it comes to third-party risk management, this role becomes even more critical and special for these professionals.

After all, in a scenario where organizations operate in an increasingly connected way with partners, suppliers, and service providers, external risks can turn into internal vulnerabilities with great impact.

This is because it is not enough to just rely on contracts or punctual evaluations, it is necessary for leadership to be actively involved, promoting a strategic, preventive, and integrated vision of risk management.

In this article, you will understand why leadership engagement is a determining factor in protecting the organization against threats and how it is possible to transform this performance into a competitive advantage.

After all, what are third-party risks?

Third-party risk is a topic that has gained relevance thanks to hyper connectivity between organizations, because it concerns the threats that an institution faces when relating to:

• Suppliers;

• Service providers;

• Business partners;

• External consultants.

  
  

As a result, any entity that, in any way, has access to the company's systems, data, processes, or infrastructure can represent a point of vulnerability.

In an increasingly digital and interconnected corporate environment, these risks become inevitable and often invisible at first glance, which is why they are so dangerous for organizations.

This is because these risks can take different forms, such as leakage of sensitive data by a third-party company, regulatory compliance failures, or even operational interruptions caused by suppliers.

The great challenge of these risks lies in the fact that, even when the threat does not originate within the organization, it is the organization that bears the consequences, whether before customers, the market or regulatory bodies.

Recent data highlights the seriousness of this issue, a report by SecurityScorecard revealed that 35.5% of data breaches in 2024 involved third parties, representing a 6.5% increase from the previous year.

In addition, third-party risks are often not managed with the same attention dedicated to internal security, as there is a lack of visibility, standardized evaluation criteria, and continuous monitoring processes.

This negligence can open loopholes for cyberattacks, social engineering scams, or incidents that put the confidentiality, integrity, and availability of corporate information at risk.

Therefore, third-party risk management needs to be treated as an essential part of the information security strategy and corporate governance.

It is a job that requires collaboration between different areas such as technology, legal, compliance and, above all, leadership. Understanding these risks is the first step to creating effective prevention and control and response mechanisms.

What is the role of leaders in managing third-party risks?

The role of leadership in risk management must be strategic, because it is crucial for the sustainability of the institution.

It is necessary to keep in mind that the role of these professionals needs to go beyond technical supervision, they need to know how to recognize and assess the risks to which the company is exposed.

In addition, it is necessary to lead the development of mitigation strategies that ensure business continuity in adverse scenarios, especially when it comes to risks involving third parties.

After all, in times of uncertainty and high digital exposure, this proactive posture becomes a competitive advantage.

With this, more than predicting threats, prepared leaders understand that risk management is not the exclusive responsibility of areas such as security, compliance, and legal.

On the contrary, it is an organizational culture that must be built collectively and this starts with example.

An engaged leader acts as a link between the different areas of the organization, promoting strategic alignment, ensuring visibility, and stimulating shared responsibility.

After all, security responsibilities need to be part of everyone's life, as they all deal with the topic in their routines without even realizing it.

Communication also stands out as a core competency in this process, because effective leaders are able to:

• Clearly convey the importance of identifying and reporting risks;

• Involve teams in the definition of action plans;

• Create open channels for sharing critical information.

  
  

These actions strengthen the organization's resilience, as it allows for a broader and more collaborative view of the risks faced on a daily basis.

Finally, leadership needs to be agile and adaptable, making informed, fast, and data-driven decisions. In this way, it is possible to lead with a focus on risks and not just on protecting the institution.

What strategies do leaders need to strengthen risk management?

As we have seen, leaders play a decisive role in how organizations deal with risks.

These professionals need to know how to react to crises, in addition to anticipating, educating, and structuring a culture that allows for an agile and coordinated response.

This is because modern risk management requires leaders to be aligned with good security practices, aware of regulatory changes, and prepared to make quick decisions based on concrete data.

More than ever, it is necessary to adopt integrated strategies that combine a systemic vision, continuous training of teams, and the use of technologies that facilitate prevention and response.

Security starts by example

Building an organizational culture focused on safety starts at the top, which means that when leaders prioritize risk management, this vision spreads throughout the organization.

In this way, the perception that security is a shared responsibility, and not just that of the IT and compliance team, creates an environment where everyone feels part of prevention.

The role of leadership is precisely this, to define the values and behaviors expected in relation to the safety and integrity of operations.

This includes clear positions on ethics, responsibility in the use of data, and commitment to good practices.

By incorporating this discourse into daily life, leaders help consolidate the safety culture as part of the company's identity.

Data-driven decision

For leaders to be able to make effective decisions in the face of risks, it is essential to have reliable, up-to-date, and accessible data. 

The absence of visibility into unsafe behavior, operational failures, or external threats limits responsiveness and can put the company in a vulnerable position.

Therefore, it is essential to integrate real-time analysis and monitoring tools, so it is possible to have a clear overview of what is working and where the main points of attention are.

Dashboards and indicators allow you to identify patterns, measure the engagement of teams in safety actions and, above all, anticipate risks before they become serious incidents.

Collaboration with teams and third parties

One of the biggest challenges is undoubtedly third-party risk management, since partners, suppliers, and service providers also have access to internal data and systems.

In this context, leadership needs to expand its vision and promote collaborative action not only within the organization, but also with its external ecosystems.

But how to do this? It is necessary to establish open communication channels, alignment of expectations and clear policies with third parties.

In addition, leaders must ensure that everyone, including external partners, is aware of the responsibilities surrounding information security, data privacy, and business continuity.

How does PhishX support leadership in risk management?

PhishX acts as a strategic ally of leadership in strengthening risk management, offering a complete security awareness and training platform.

With it, leaders can implement campaigns aimed at different audiences, including internal employees, remote teams, and even third parties, reinforcing the security culture in a continuous and personalized way.

This process helps create an environment where everyone understands their role in preventing threats, reducing human error, and improving the security posture of the organization as a whole.

In addition, our ecosystem offers real-time visibility through detailed dashboards and reports.

This information allows leaders to monitor vulnerabilities, assess team engagement, and make data-driven decisions.

This analysis capacity facilitates the definition of priorities and the adoption of corrective measures with agility, promoting more efficient and integrated risk management with the business.

With specific indicators by area, profile or maturity level, leadership is able to act more strategically and assertively.

Another differential is the possibility of simulating real attacks, such as phishing in a controlled environment. These simulations help test people's maturity and identify weak points before a real threat happens.

By bringing together automation, intelligence, and user experience, PhishX makes risk management a seamless process.

Want to know more? Get in touch with our experts, schedule a conversation and transform your institution's risk management.

Leadership plays an essential role in third-party risk management