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4 Things To Avoid Looking For A Third-Party Risk Management Solution

Risk Management | November 30, 2021
Third-Party Risk Management

In your search for a third-party risk management provider, it’s important to know what to look for. The solutions, the customer service, and the years of experience the provider has will all play a part in the decision-making process.

Why Is Contractor Risk Mitigation So Important?

If your organization uses a vendor network to provide services, deliver products, or repair products for your customers, those contracted service providers are direct representatives of your company. Contractors may also have access to the same systems and resources that your organization’s full-time employees do, making it important to make sure that you’re working with the right individuals.

4 Things To Avoid When Looking For A Third-Party Risk Management Solution

Self-Certification Instead of Direct Verification

Is your contractor compliance program just a “check in the box”? Or does it demonstrate true due diligence that your organization’s contractor risk mitigation seriously? 

Anyone can self-certify to something if they never have to prove it. For example, your servicing company could tell your organization they hold current insurance, or your contractor could tell you that they’ve never committed a violent crime – but if your organization were to take them at their word and agree that any contract requirements had been met, this could end badly and would not provide the protection you may be expecting. In this scenario, your organization has done nothing to verify that what your vendors are saying is true.

Direct verification, on the other hand, is typically handled by a third party that provides an investigation into whether or not the contractor meets your organization’s requirements. This is the step of actually confirming the information provided is true, accurate, and in compliance with your expectations.

A One-and-Done Approach

Some contractor compliance solutions providers may focus on screeningThird-Party Risk Management contractors at the start of the contract and leave it at that. Or, your organization may rely on a COI (certificate of insurance) management system that includes an initial submission of the COI from your contractor, never reviewing the content, limits, or coverages, filing the COI in a drawer, and forgetting about it. You may have received license verification for your contractors, but what if a license is revoked down the road? This one-and-done approach will not mitigate risk or reduce liability if an issue arises.

In order to protect the safety of your customers and the reputation of your company, your third-party risk management solution should include thorough contractor background checks partnered with continuous criminal monitoring.

It’s a similar story when it comes to COI management. Your contractor’s COI gives you evidence the contractor carried insurance at the time the COI was issued, but what about six months later?

Reliance on Databases

Some contractor compliance providers may rely solely on national databases for criminal information or license verification – PlusOne Solutions may include these but also goes to the source of any database information. Your risk management partner should utilize agents for COI verification, county-level reporting for criminal records, and manual review and verification for licenses.

Singular Instead of Comprehensive Solutions

In today’s world, you want your contractor compliance program to be as simple and streamlined as possible. It’s not productive to work with a provider that only offers one service option, and then find another provider for the next – slowly piecing together a risk management solution. That’s why PlusOne Solutions offers a comprehensive third-party risk management program that includes:

For the past 16 years, PlusOne Solutions has been pursuing our vision to serve the extended workforce industry. Contact us today to learn more about how our solutions can help your organization.

Contents are provided for information purposes only and should not be construed as legal advice. Users are reminded to seek legal counsel with respect to their obligations and use of PlusOne Solutions services.

About PlusOne Solutions

PlusOne Solutions has been an industry leader in the risk management field by specializing in compliance programs that meet the complex challenges of geographically dispersed contractors, vendors, and employee networks. PlusOne Solutions protects companies from possible financial, legal, and reputational risks associated with contractor and vendor relationships while creating safer work environments. To learn more, visit https://www.PlusOneSolutions.net.

 

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