What is Third Party Risk Management?
There is a moment in every regulated business when trust is extended.
A custody provider is onboarded. A transaction monitoring system is plugged in. An external compliance adviser is appointed. A cloud vendor is granted access. The decision feels sensible, even prudent. After all, expertise has been engaged.
Yet in the eyes of the regulator, trust does not dilute responsibility.
Third Party Risk Management is the structured way a firm governs the risks that arise when another party performs activities on its behalf or alongside it. It is not a document. It is a discipline. One that follows every vendor, outsource provider, and service partner across the full lifecycle of the relationship.
Third Party Risk Management applies to all forms of external reliance, including outsourcing arrangements, professional services, technology vendors, infrastructure providers, and specialist support functions. It brings operational, compliance, financial, technology, and reputational considerations into a single, coherent view of third-party exposure.
Curated for the UAE
UAE regulators examine third party arrangements with a steady and deliberate eye. Their concern is not the nature of the service alone, but the quality of governance that surrounds it. Whether a firm relies on transaction monitoring systems, custody technology, cloud infrastructure, onboarding platforms, professional advisers, or outsourced control functions, the expectation remains unchanged
GRC Advisory designs Third Party Risk Management Services for organisations operating across the UAE Mainland and Free Zones with this reality firmly in mind. Our frameworks are aligned with supervisory expectations under the UAE AML Law and the Central Bank of the UAE AML CFT Rulebook, as well as the outsourcing and systems and controls requirements set by VARA, the SCA, ADGM FSRA, and DIFC DFSA. We structure third-party governance so it can be articulated calmly and coherently during licensing discussions, inspections, and thematic reviews.
This is why our work resonates with UAE regulators. It reflects the way they assess risk, respects the standards they apply, and demonstrates that reliance on third parties is managed deliberately and with discipline. It is Third Party Risk Management shaped by the UAE regulatory environment, delivered by advisors who understand both expectation and execution.
Why is Third Party Risk Management Framework Important?
Most third party risk is not created by negligence. It is created by momentum.
Vendors are engaged to solve immediate problems. Outsourcing decisions are made under time pressure. Responsibilities blur as relationships mature. Over time, critical activities drift outside the organisation, while accountability remains inside it.
Without a structured third party risk management framework, organisations lose sight of how dependent they have become. Due diligence ages quickly. Contracts fail to reflect current operations. Monitoring becomes informal. Exit planning is postponed. When something goes wrong, the firm struggles to explain not just what happened, but why the relationship existed in the first place.
In the UAE, this lack of structure is exposed quickly. During inspections, licensing reviews, or supervisory engagement, firms are asked to demonstrate how third party relationships are governed in practice. The absence of clear reasoning, documented decisions, and ongoing review becomes visible, often at the worst possible moment.
Effective Third Party Risk Management prevents this slow erosion of control. It introduces discipline into outsourcing decisions, ensures risks are assessed before dependency forms, and preserves accountability as relationships evolve. It creates a defensible record of judgment that can be relied upon long after the original decision was made. Get in touch with us to avail GRC Services in UAE.
Protect board members and senior management from personal and regulatory exposure
Reduce friction during inspections, supervisory reviews, and regulatory engagement
Support faster licensing decisions and smoother approval processes
Build confidence with banks, counterparties, investors, and strategic partners
Introduce decision-making discipline as organisations grow in scale and complexity
Put simply, governance is what keeps an organisation steady as expectations rise and scrutiny intensifies. It keeps the wheels on when the road becomes uneven.
Our Third Party Risk Management Services in UAE
Our Third Party Risk Management Services cover the full lifecycle of vendor and outsourcing relationships. Each service addresses a specific decision point, where poor structure tends to create lasting risk.
Vendor Due Diligence
Vendor due diligence is the process of assessing a third party before it is approved or engaged. It establishes whether the vendor is suitable for the role it will perform and whether the organisation understands the risks it is accepting.
Our work includes:
- Vendor risk assessments that evaluate operational, regulatory, technology, and dependency risk
- Due diligence questionnaires and document reviews proportionate to the service provided
- Risk scoring and approval frameworks that record the basis on which a vendor is accepted
Outsourcing Governance
Outsourcing governance defines how third-party relationships are controlled once they are in place. Our work here is structural. It creates a coherent view of reliance across the organisation and assigns responsibility where it can actually be exercised.
- Outsourcing policies that reflect how services are really delivered
- Registers and materiality classifications that show where dependence sits
- Governance rhythms that force review before issues become entrenched
Contracts and Exit Plans
Contracts and exit planning determine whether governance survives stress. They define the organisation’s ability to supervise, challenge, and disengage from a third party if required.
Our work includes:
- Contractual clauses covering service levels, audit rights, access, and regulatory cooperation
- Allocation of responsibility between the firm and the vendor
- Exit and transition plans that support continuity and regulatory accountability
Vendor Monitoring
Vendor monitoring is the ongoing process of reassessing risk after onboarding. It ensures that changes in service, performance, or dependency are identified early.
Our work includes:
- Periodic reassessment of vendor risk profiles
- Performance reviews and issue tracking
- Concentration and dependency risk analysis
Vendor Incidents
Effective incident management begins before an incident occurs. We help firms define what constitutes a third-party incident, how severity is assessed, and when escalation is required. This creates certainty at the moment it is most needed, removing hesitation and inconsistency from decision-making.
Our work covers:
- Clear incident classification and severity thresholds for third party failures
- Defined escalation pathways to senior management and governance forums
- Structured internal reporting that supports timely and accurate decision-making
- Root cause analysis focused on governance, control, and dependency, not blame
- Remediation actions that address both the immediate issue and the underlying weakness
A Pause Is Sometimes the Right Response
Especially before the Next Vendor Is Approved
Industries We Serve
Accountants and Auditors
Asset Managers & Investment Firms
DPMS
Insurance
Lawyers
Payments and Fintech
Real Estate
Securities & Brokerage
TCSPs
VASPs
Points of Strain
In the UAE, these pressure points surface differently depending on the regulator, the licence, and the structure of the business. What follows are the familiar moments where confidence wavers and governance is asked to explain itself.
VARA Regulated Firms
- Limited visibility into how embedded technology vendors operate day to day
- Informal governance over providers that perform critical regulated functions
- Dependency on single vendors without realistic exit or transition planning
- Difficulty demonstrating continued control when relationships are reviewed
DIFC Firms
- Unclear division of responsibility between local entities and group providers
- Inconsistent audit and access rights across vendor and intra-group contracts
- Fragmented documentation spread across policies, agreements, and teams
- Inability to present a unified picture of third party arrangements
ADGM Entities
- Due diligence is performed once, then left unchanged as reliance increases
- Limited reassessment when vendors change ownership, scope, or delivery model
- Senior management involvement that is assumed rather than evidenced
- Difficulty demonstrating active oversight during supervisory reviews
SCA-Regulated Firms
- Uneven application of vendor risk assessments across service types
- Materiality thresholds that are poorly defined or misunderstood
- Monitoring practices that do not reflect the importance of the service
- Limited ability to explain why certain vendors receive greater scrutiny
Mainland and Free Zone Companies
- Vendor relationships managed through contracts alone
- Unclear decision-making when vendors fail or underperform
- Sparse documentation to support regulatory, investor, or partner review
- Structures that strain as the business grows or diversifies
Why GRC Advisors?
Selecting a third party risk management advisor is a matter of exposure. Such an advisor is entrusted with a privileged view of the organisation’s most consequential choices: who is relied upon, how dependency is justified, and whether control has endured as growth has gathered pace.
What follows sets out the standards that separate credible third party risk management advisory from the merely adequate in this environment.
- Deep expertise in UAE-specific regulatory environments, including regulators such as the Central Bank of the UAE, VARA, SCA, FSRA, DFSA, MoET, and MoJ.
- A team comprised of globally recognised professionals with extensive sector experience across financial institutions, DNFBPs, and VASPs.
- Proven success in helping firms achieve and maintain compliance with complex legislative frameworks, tailored to their specific licence and activities.
- Customised consulting that adapts to business size, industry vertical, and operational model, rather than one-size-fits-all solutions.
- Practical, end-to-end support that equips firms with audit-ready documentation and evidence for supervisory reviews.
- Track record of delivering compliance frameworks that support businesses through onboarding, scaling, and regulatory engagement.
Before Reliance Hardens into Habit
A Considered Conversation Can Surface What Has Accumulated across Vendors and Outsourcing Arrangements