Ecosystem Security

The Fourth-Party Dilemma: Why You Should Care About Your Vendors' Vendors

Dr Magda Chelly
Managing Director at Responsible Cyber

In an increasingly interconnected business landscape, third-party risk management has become a crucial aspect of ensuring security and compliance. However, as organizations continue to rely on an expanding network of suppliers and partners, a new concern arises: the risks associated with fourth parties, or the vendors of their vendors. This article aims to shed light on the importance of fourth-party risk management and spark a discussion on why businesses should care about their vendors' vendors.

The Rise of Fourth-Party Risks

As the supply chain becomes more complex, organizations face the challenge of managing not only the risks associated with their direct third-party relationships but also those of their third parties' suppliers, or fourth parties. A security breach or compliance violation at the fourth-party level can have a cascading effect, impacting the entire supply chain and potentially causing severe damage to your organization.

The following reasons highlight why fourth-party risk management should be a priority for businesses:

  1. Increased Attack Surface

The more suppliers and partners an organization has, the greater the attack surface. Fourth parties introduce new entry points for cybercriminals to exploit, increasing the likelihood of a security breach. In many cases, organizations may not even be aware of their full exposure to fourth-party risks, leaving them vulnerable to unanticipated threats.

  1. Regulatory Compliance

Regulatory authorities have been increasingly focused on third-party risk management, with many frameworks and standards now requiring organizations to manage and assess the risks associated with their extended supply chain. Ignoring fourth-party risks can lead to non-compliance with these regulations and result in hefty fines, reputational damage, and loss of trust from customers and partners.

  1. Loss of Intellectual Property

When an organization shares sensitive data or intellectual property with a third party, it expects that the third party will take the necessary precautions to protect the information. However, the same level of security may not be guaranteed with the fourth party. As a result, organizations may unknowingly expose their valuable assets to potential theft or misuse.

  1. Supply Chain Disruptions

A cyber incident or operational failure at the fourth-party level can disrupt the entire supply chain, causing delays, financial losses, and negative impacts on customer satisfaction. Businesses must ensure the resilience of their supply chain by understanding and managing fourth-party risks proactively.

Addressing the Fourth-Party Challenge

While the risks associated with fourth parties may seem daunting, there are steps businesses can take to address these concerns:

  1. Map Your Supply Chain

To effectively manage fourth-party risks, organizations must first understand their supply chain's full scope. This involves identifying all fourth parties that have a direct or indirect relationship with your organization, along with their respective roles and responsibilities.

  1. Assess and Prioritize Risks

Once the supply chain has been mapped, organizations should assess the risks associated with each fourth party. This includes evaluating their security posture, compliance with relevant regulations, and the potential impact of any disruption on your organization. Based on this assessment, businesses can prioritize their risk mitigation efforts.

  1. Establish Clear Expectations and Communication Channels

Organizations should establish clear expectations for third parties regarding the management of their suppliers. This includes setting specific requirements for fourth-party risk assessment, monitoring, and reporting. Additionally, businesses should maintain open communication channels with their third parties to ensure transparency and prompt resolution of any issues that may arise.

  1. Monitor and Review

Fourth-party risk management is an ongoing process that requires continuous monitoring and review. Businesses should regularly assess their supply chain for new risks, update their risk assessments, and adjust their mitigation strategies as needed.


As organizations continue to rely on an ever-expanding network of suppliers and partners, fourth-party risk management can no longer be overlooked. By understanding the potential threats and proactively

Dr Magda Chelly
Managing Director
Co-Founder of Responsible Cyber | Author | TEDx Speaker | Featured on Forbes 🇵🇱 | World Economic Forum Expert Network Cybersecurity | PhD, S-CISO, CISSP, Cert SCI Dr. Magda Lilia Chelly is an accomplished cybersecurity expert, entrepreneur, and thought leader, known for her extensive knowledge and passion for protecting businesses from cyber threats. Holding a Ph.D. in Telecommunication Engineering and an Executive MBA, she has built a stellar reputation as a trusted advisor in the field of information security. Dr. Chelly has served in various leadership roles, including as a CISO and a Managing Director for a global cybersecurity consultancy. Her expertise spans multiple domains, such as risk management, cybersecurity strategy, and governance. With numerous industry certifications and recognition as a CISSP, Dr. Chelly is a sought-after speaker and contributor to international conferences, webinars, and publications. As an advocate for diversity and inclusion in the technology sector, Dr. Chelly actively supports initiatives to encourage more women to pursue careers in cybersecurity. Her dedication to empowering and mentoring the next generation of cybersecurity professionals has made her a respected figure within the industry. In addition to her professional accomplishments, Dr. Chelly is an avid writer, sharing her insights and experiences through articles, blogs, and social media platforms. Her engaging and educational content has helped raise awareness about the critical importance of cybersecurity in an increasingly interconnected world.

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