The Ultimate Guide to Scalable Third-Party Risk Management (TPRM) for SaaS

ISO 27001, SOC 2, and GDPR Compliance Done Right

SaaS organizations thrive on speed, agility, and partnerships. However, with growth comes expanding third-party exposure—vendors, cloud providers, contractors, and AI tools all become intertwined with core operations. Each connection introduces risk. Left unchecked, these risks can derail compliance efforts, compromise sensitive data, and damage trust.

To stay audit-ready for ISO/IEC 27001:2022[1], SOC 2[2], and GDPR[3], SaaS companies need more than a checkbox approach. They need a TPRM program that is structured, scalable, and embedded into the business lifecycle.

This in-depth guide breaks down the process of building a resilient, audit-ready TPRM program that integrates security, compliance, and automation from day one.

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⚖️ Step 1: Define the Strategy and Align with Compliance Goals

Start with a clear purpose: your TPRM program must support compliance while being operationally practical. Each framework sets expectations:

• ISO/IEC 27001:2022

Annex A.15 requires controls for managing supplier relationships, including security requirements in contracts and monitoring third-party performance[1].

• SOC 2 Trust Services Criteria

CC7.1 mandates organizations to monitor vendor services that could impact security, availability, or confidentiality[2].

• GDPR

Articles 28–32 require data controllers to only use processors (vendors) who implement appropriate security safeguards, especially around personal data[3].

Action Plan

• Map Framework Requirements: Build a crosswalk that aligns ISO, SOC, and GDPR controls.

• Develop a Unified Policy: Create a single TPRM policy with embedded control objectives covering all three frameworks.

• Assign Ownership: Use a RACI model to designate responsibilities across Procurement, Security, Legal, and Privacy.

• Create a Vendor Tiering Model: Use a risk-based matrix to classify vendors by:

  • Data sensitivity (e.g., access to PII, PHI)

  • System access (production, APIs, CI/CD pipelines)

  • Business criticality (impact on SLAs or revenue)

  • Regulatory exposure (GDPR, HIPAA, etc.)

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📊 Step 2: Build a Vendor Inventory and Classification Engine

You can’t protect what you can’t see. Start by identifying all vendors who touch your data, systems, or operations.

Vendor Discovery Sources

• Procurement systems (e.g., Coupa, Ariba)

• Accounting platforms (e.g., NetSuite)

• IAM/SSO tools (e.g., Okta, Azure AD)

• SaaS management platforms (e.g., Torii, BetterCloud)

• Shadow IT scans and Chrome extensions audits

Classification Framework

• Tier 1: High Risk

  • Access to production systems or sensitive data

  • Use of privileged credentials or encryption keys

  • SaaS tools integrated into mission-critical workflows

• Tier 2: Moderate Risk

  • Internal tools used for day-to-day operations

  • SaaS tools connected to development environments

  • No PII but could affect productivity

• Tier 3: Low Risk

  • No system or data access

  • Examples: office supply vendors, HR training providers

Each tier determines the depth of review, documentation requirements, and reassessment frequency.

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🔐 Step 3: Conduct Risk-Based Due Diligence

Due diligence isn’t just a formality—it’s the proof auditors will ask for. Tier 1 vendors should undergo the most rigorous review.

For ISO 27001 Alignment[1]:

• Request Statement of Applicability (SoA)

• Review controls for:

  • Access Control (A.9)

  • Cryptographic Protection (A.10)

  • Operations Security (A.12)

  • Supplier Management (A.15)

For SOC 2 Alignment[2]:

• Request SOC 2 Type II reports

• Validate control coverage and test results

• Check for unresolved exceptions or high-risk findings

For GDPR Alignment[3]:

• Validate Data Processing Agreements (DPAs)

• Confirm international transfer safeguards (SCCs or BCRs)

• Verify breach notification timelines and DPO contact

Use Standardized Questionnaires

• SIG Lite/Core for broad vendor security reviews[4]

• CAIQ for cloud-native services[5]

Validate Evidence

• Request:

  • Penetration test reports

  • Security policy excerpts

  • Infrastructure diagrams or data flows

• Leverage SecurityScorecard or BitSight to monitor vendor ratings over time[6]

Automate Workflow

• OneTrust Vendorpedia for risk questionnaires, evidence storage, and reporting[7]

• ServiceNow GRC for orchestration and lifecycle integration[8]

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🛎️ Step 4: Embed TPRM Into the Vendor Lifecycle

Too often, vendors are onboarded before risk reviews occur. Fix this by operationalizing TPRM:

• Procurement

• Require security intake forms as part of RFPs or purchase requests

• Auto-trigger tier classification and notify Security/Privacy based on risk

• Legal

• Embed GDPR-compliant DPAs[3]

• Require security SLAs, breach notification clauses, audit rights

• Standardize fallback clauses for vendors who resist obligations

• Security

• Require MFA, VPN, RBAC validation before provisioning access

• Block access to production until control verification is complete

• Review penetration tests for production-facing vendors

• Automation

• Use Whistic for easy vendor collaboration and assessment sharing[10]

• Trigger workflows from tools like Coupa, Ironclad, Jira

• Integrate alerting via Slack, MS Teams, and Jira for escalations

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📊 Step 5: Monitor, Reassess, and Offboard Vendors

Risk doesn’t end after onboarding. Vendors evolve, and so must your oversight.

Continuous Monitoring

• Require vendors to report incidents within 72 hours (GDPR Article 33)[3]

• Track:

  • SOC 2 & ISO 27001 certification expirations

  • Pentest timelines and findings remediation

Reassessment Cadence

• Tier 1: Annually or upon major change

• Tier 2: Every 18–24 months

• Automate reminders in LogicGate or ServiceNow GRC

Responsible Offboarding

• Remove all credentials from IAM, VPN, and SaaS platforms

• Validate data deletion or return with evidence (GDPR Article 28(3)(g))[3]

• Archive all documentation (assessments, DPAs, contracts) for 3–7 years

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⚖️ GRC Automation: Scale with Confidence

Manual TPRM is unsustainable at scale. Automate to reduce friction, improve audit readiness, and increase accuracy.

Core Features to Automate

• Tier-based risk workflows

• Evidence collection

• Due diligence assignments

• Escalation alerts

• Executive dashboards

Recommended Platforms

• LogicGate Risk Cloud for flexible workflow builds

• OneTrust for privacy and compliance mapping[7]

• Vanta for rapid assessments tied to SOC 2[7]

• SecurityScorecard or BitSight for posture tracking[6]

Dashboard KPIs

• % of Tier 1 vendors with current SOC 2

• of overdue reassessments

• Top 10 vendors by risk exposure

• Vendors missing DPA or security documentation

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🔗 Final Thoughts

A truly mature TPRM program isn’t just about compliance—it’s about proactive risk defense. By embedding TPRM into the vendor lifecycle, aligning with ISO 27001, SOC 2, and GDPR, and leveraging automation, SaaS companies can:

• Strengthen audit posture

• Improve vendor accountability

• Reduce exposure from weak links

• Build trust with customers and regulators

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📛 References

[1] ISO/IEC 27001:2022. International Organization for Standardization. https://www.iso.org/standard/82875.html
[2] AICPA Trust Services Criteria. https://www.aicpa.org/resources/article/trust-services-criteria
[3] General Data Protection Regulation (EU) 2016/679. https://eur-lex.europa.eu/eli/reg/2016/679/oj
[4] Shared Assessments SIG Questionnaire. https://sharedassessments.org/sig/
[5] Cloud Security Alliance CAIQ. https://cloudsecurityalliance.org/research/caiq/
[6] SecurityScorecard. https://securityscorecard.com/
[7] OneTrust Vendorpedia. https://www.onetrust.com/products/vendorpedia/
[8] ServiceNow GRC. https://www.servicenow.com/products/governance-risk-and-compliance.html
[9] NIST SP 800-161 Rev. 1. https://csrc.nist.gov/publications/detail/sp/800-161/rev-1/final
[10] Whistic Vendor Security Platform. https://www.whistic.com/

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