Which strategy best mitigates third-party risks?

• A. Ignoring vendor audits
• B. Continuously assessing vendor performance
• C. Limiting communication with vendors
• D. Selecting vendors with the lowest price

Answer: (B)

Continuously assessing vendor performance is the best strategy for mitigating third-party risks because it establishes an ongoing process of evaluation that ensures vendors comply with contractual obligations and security standards. This proactive approach enables organizations to identify potential risks and issues early, allowing for timely remediation. By regularly monitoring performance metrics, compliance with regulations, and overall vendor reliability, businesses can maintain better control over third-party interactions, thus reducing the likelihood of data breaches, non-compliance, or other risks associated with vendor relationships.

Additionally, continuous assessment fosters strong collaboration with vendors, which can lead to improvements in service delivery and security posture. This strategy encourages transparency, helps establish trust, and reinforces accountability, ultimately contributing to the organization's resilience against third-party risks.