Law firms and legal vendors are entrusted with a vast array of highly confidential and privileged information, making them a prime target for cyber-attacks. The ABA recently reported that 29% of firms surveyed had experienced a breach.
This makes it imperative for client organizations to assess and manage the cyber risk associated with these vendors diligently, as any breach could have significant legal, financial, and reputational implications for an organization.
In this I will provide you a practical guide for initiating and maintaining an effective Legal Vendor Cyber Risk Management (LVCM) program.
How Robust Is Your Legal Vendor Cyber Risk Program?
1. Getting Started
The journey to effective cyber risk management begins with identifying all your legal vendors. This process involves collaboration with accounts payable to compile a comprehensive list and engaging with your legal team for verification.
Establishing clear categories for risk levels and data types facilitates targeted assessments and resource allocation.
Tip: Check with other departments like Tax, Audit and HR that may also be engaging legal vendors outside the legal department.
2. Collecting Cyber Risk Data from Your Legal Vendor
Collecting data from vendors is critical for informed risk-based decision-making. The “Inside-Out” approach relies on self-assessments from vendors, while “Outside-In” data collection utilizes third-party tools for a security risk scoring based on publicly available information.
Each method has its advantages and challenges, highlighting the importance of a balanced and informed approach.
Tip: Align self-assessments to your organization’s minimum required security controls and avoid open-ended questions that will require more subjective judgement.
3. Validating and Analyzing Your Vendor’s Cyber Risk Data
Validating the collected data ensures its relevance and integrity, setting the stage for a thorough analysis. This phase involves assessing inherent risks and gaps against your organizations’ minimum required security controls and deciding on the necessary actions to mitigate identified vulnerabilities.
Tip: Ask vendors to provide copies of certifications and evidence of implemented security controls.
4. Remediating and Monitoring the Cyber Risks Based on Your Vendor Assessment
The remediation phase focuses on addressing critical risks and implementing improvements or compensating controls. Continuous monitoring ensures compliance and adapts to any changes in the vendor’s status or the broader cyber threat landscape.
Tip: Define your tolerance (e.g. time) for vendors to remediate the minimum required security control gaps to help them prioritize their efforts.
Leveraging Artificial Intelligence in LVCRM
Although still in its early stages, AI will become essential to enhance various aspects of a Legal Vendor Cyber Risk Management program. AI-driven tools can automate the identification and assessment of legal vendors, efficiently parsing through large datasets to categorize risks and vulnerabilities.
By employing natural language processing, AI can analyze vendor documents and contracts for compliance and risk factors, streamlining the validation process. Furthermore, machine learning algorithms can monitor and predict emerging cyber threats, enabling proactive risk mitigation and enhancing the program’s efficacy through predictive analytics.
Tip: See my next blog to see how AI can be used in your program!
Conclusion – Creating a Sustainable Cyber Vendor Cyber Risk Program
Implementing a strategic LVCRM program is not a one-off task but a continuous effort requiring commitment and adaptation. A LVCRM program is indispensable for legal departments to protect sensitive information from cyber threats.
It should be scalable, with defensible strategies supported by leadership to manage and mitigate cyber risks effectively.
Cyber risk management must be a key component in managing vendor relationships. It starts with gathering cyber risk information, analyzing and validating it, and ensuring remediation and monitoring strategies are in place.
Disclaimer: This article is provided for educational and information purposes only. Neither Swiftwater & Co. or the author provide legal advice. External links are responsibility and reflect the thinking of their respective authors – those are provided for informational purposes only.
