TPRM Trends for 2025: Growing Third-Party Dependency and Array of Related Risks

Current trends highlight an increasingly daunting third-party risk management (TPRM) landscape: As organizations’ dependency on third parties and third-party technologies grows, so does the spectrum of risks to which those organizations are exposed. The challenges embedded in these trends are simultaneously opportunities to increase the value and impact of TPRM work. Fortunately, new technology innovations can help teams respond to these 2025 trends, enabling the streamlined processes, scalability, scoring flexibility and transparency, and multiple reviews TPRM teams need to respond effectively. 

Trend 1: Growing Dependency on Third Parties — Intensified by AI

Most organizations depend on third parties for key services and processes. As advanced technologies like AI proliferate, however, we are seeing even higher rates of third-party dependency. The problem is that these technologies often bring big uncertainties. How is data stored and used (e.g., for model training)? How vulnerable are systems to data breaches or other cyberattacks?

Historically, such uncertainties might compel organizations to opt against using these technologies, or to implement them cautiously and slowly. But with AI so ubiquitous, easy to adopt, and low- or no-cost, people are adopting it regardless — often without going through proper channels. Increasing third-party dependency means more third parties to identify and assess, and introducing new third-party technologies adds new layers of complexity. Accordingly, TPRM teams need to scale and streamline their processes to expand their reach and impact while making it easier for third parties to respond. 

How Tech Can Help

• Contract details capabilities help teams quickly access key details of current third-party relationships, including active contracts, renewal dates, and terms (e.g., assessment frequency) to enable more efficient risk assessments — and avoid contacting the wrong vendors at the wrong times. 
• Scoring overrides reduce back-and-forth vendor communications about evidence through flexible questionnaires and risk scoring and clear audit trails. Questionnaires permit changes (e.g., updating responses or associated point values without requiring vendors to do it) while documenting what changes were made, by whom, and why, improving transparency and auditability. Automatic scoring improves efficiency while accounting for gray areas: Teams can use manual overrides on some responses and automatic scoring on others.
• Automated assessment completion makes it easier for vendors to respond by uploading previously completed questionnaires, SOC 2 reports, or other documents. Secure AI capabilities scan uploaded documents to populate new questionnaires with suggested responses for vendors to refine. Gain efficiencies by receiving responses back more quickly. 
• Risk acceptance capabilities support more effective risk remediation by enabling teams to (1) tie any issues identified to entity risks and (2) surface a risk acceptance for management to review the risk exposure, either signing off on moving forward without remediation or rejecting until remediation is completed. 

Trend 2: New Vulnerabilities Are Broadening the Scope of Risk

Increasing third-party dependency also broadens the array of risks to which organizations are exposed. Third-party vulnerabilities can significantly impact organizations’ resiliency, cybersecurity, digital, reputational, fraud, legal, supply chain, financial, operational, strategic, regulatory, and sustainability risks — and beyond.  

Organizations need more holistic views of the complex web of risks third parties are introducing. At the same time, most TPRM teams are fairly small, and every organization has a growing roster of third parties that need to be assessed, either for the first time or as part of ongoing monitoring. Further, gaining a comprehensive view on risk requires input from stakeholders across the organization. It’s harder than ever for resource- and time-constrained teams to keep up with the broadening scope of thirty-party risk.

How Tech Can Help

• Multiple reviewers capabilities streamline stakeholder input gathering and reviews by enabling multiple teams to review and assess risk assessments — either sequentially to ensure all levels review in the right order, or nonsequentially, allowing review at any point in the process. Each risk domain can have its own questionnaire to capture a score, and stakeholders can review others’ questionnaires to ensure they understand the full picture or provide commentary for other domains to consider in assessing their risks.
• Aggregate scoring enables teams to quickly sum up multiple questionnaires to capture both individual risk domain scores and more holistic risks (e.g., residual risks). Because not all domains carry the same weight, weights can be adjusted to correctly capture final overall risk. 

Innovating TPRM Solutions for 2025 and Beyond

AuditBoard is purpose-built to help TPRM teams transform challenges into strategic advantages. Every solution we build is designed around the use cases, workflows, pain points, and priorities of the teams we serve. Learn more about how AuditBoard’s industry-leading third-party risk management software can help you turn 2025’s trends into opportunities to streamline processes, enhance scalability and transparency, and gain the more holistic view on third-party risk needed for effective TPRM in the modern age.