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Fourth-Party Risk

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# Fourth-Party Risk

##### [Catherine Chipeta](/team/catherine-chipeta)

updated Apr 23, 2024

###### Contents

## What is Fourth-Party Risk?

[Fourth-party risk](https://www.upguard.com/blog/what-is-fourth-party-risk) is risk brought on by your vendors’ vendors. An organization’s [cybersecurity practices](https://www.upguard.com/blog/cyber-security) can become obsolete if its vendors do not have a robust third-party risk management (TPRM) program in place to manage fourth-party risk. Beyond [third-party risks](https://www.upguard.com/blog/what-is-third-party-risk), [information security teams ](https://www.upguard.com/blog/information-security)should also account for fourth parties to create a comprehensive vendor risk management (VRM) framework.

## Why is Fourth-Party Risk Important?

Fourth parties form part of an organization’s [attack surface](https://www.upguard.com/blog/attack-surface) and significantly increases the number of [attack vectors](https://www.upguard.com/blog/attack-vector) to which the organization is exposed. Regardless of where in the [supply chain a security incident occurs](https://www.upguard.com/blog/supply-chain-attack), an organization is always fully responsible for enacting an appropriate [incident response plan](https://www.upguard.com/blog/incident-response-plan).

Despite third parties offering an added layer of protection during a fourth-party security incident, such an occurrence still exposes organizations to a significant level of [cybersecurity risk](https://www.upguard.com/blog/cybersecurity-risk).

For example, if a fourth party suffers a [data breach](https://www.upguard.com/blog/data-breach) affecting a third party, the threat actor could access an organization’s [sensitive data](https://www.upguard.com/blog/sensitive-data) through the third party. Ensuring third parties are performing [vendor due diligence](https://www.upguard.com/blog/vendor-due-diligence) is crucial to mitigating this risk.

## Key takeaways

* A fourth party is your vendors' vendor. Fourth-party risk is the risk incurred by these vendors.
* Your organization is responsible for managing its fourth-party risk.
* You must ensure your vendors are performing due diligence with their vendors to mitigate fourth-party risk.
*
*

###### Reviewed by

No items found.

###### Author

##### [Catherine Chipeta](/team/catherine-chipeta)

###### Reviewed by

##### [Kaushik Sen](/team/kaushik-sen)

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