Beyond the Checkbox (Ep. 4): The Role of AI in TPRM with Jag Lamba
Episode Summary
In this episode of Beyond the Checkbox, Matt Kelly sits down with Jag Lamba, CEO and co-founder of Certa, to discuss the evolving landscape of third party risk management. They delve into the challenges companies face with increasing regulations and the complexities of managing vast networks of third-party vendors.
Jag shares his journey from McKinsey to becoming an entrepreneur, emphasizing the importance of addressing information security and privacy concerns in today's volatile geopolitical climate. He highlights how AI can revolutionize risk management by automating and streamlining processes, making it easier for companies to comply with new regulations and mitigate risks effectively.
Listeners will gain insights into the impact of geopolitical tensions, the rise of ESG requirements, and the crucial role of generative AI in transforming third party risk management. This episode offers practical advice for businesses looking to navigate these challenges and improve their risk management strategies.
Key Insights
The Importance of Third Party Risk Management
In this episode, Jag Lamba highlights the critical role of third party risk management in today's business landscape. He points out that companies, especially large enterprises, often work with tens of thousands of vendors, making it essential to manage these relationships effectively. Jag emphasizes that third party risks are not just about compliance but also encompass business risks, including information security, privacy, and reputational damage. He explains how the evolving geopolitical landscape, with its increasing regulations and geopolitical tensions, adds to the complexity of managing these risks. Jag stresses the need for companies to adopt robust third party risk management practices to protect their operations and maintain their reputation in a highly interconnected and volatile world.
Leveraging AI for Risk Management
Jag Lamba discusses the transformative potential of generative AI in managing third party risks. He explains that AI can automate the process of sifting through vast amounts of data, identifying risks, and ensuring compliance with new policies. For instance, AI can scan vendors to determine compliance with new regulations, analyze SOC 2 reports, and flag potential issues. This capability is particularly crucial as companies face an increasing number of regulations and the need to manage large volumes of data. Jag shares that AI can help companies stay ahead of emerging risks and respond more effectively to incidents like security breaches. By leveraging AI, companies can reduce the burden of manual processes and focus on strategic risk management, enhancing their overall resilience.
The Role of ESG in Third Party Risk Management
Environmental, Social, and Governance (ESG) considerations are becoming a significant driver of third party risk management. Jag Lamba explains that companies are facing both external pressures from regulators and internal pressures from boards, employees, and customers to adopt sustainable and ethical practices. He notes that the demand for more sustainable and ethical products is reshaping how companies approach third party risk management. Jag highlights that ESG regulations are not just a compliance requirement but also an opportunity for companies to enhance their reputation and attract customers. He underscores the importance of integrating ESG considerations into risk management strategies to meet these growing demands and stay competitive in the market. This integration helps companies build trust with stakeholders and ensures long-term sustainability.
Beyond the Checkbox (Ep. 4): The Role of AI in TPRM with Jag Lamba
Episode Summary
In this episode of Beyond the Checkbox, Matt Kelly sits down with Jag Lamba, CEO and co-founder of Certa, to discuss the evolving landscape of third party risk management. They delve into the challenges companies face with increasing regulations and the complexities of managing vast networks of third-party vendors.
Jag shares his journey from McKinsey to becoming an entrepreneur, emphasizing the importance of addressing information security and privacy concerns in today's volatile geopolitical climate. He highlights how AI can revolutionize risk management by automating and streamlining processes, making it easier for companies to comply with new regulations and mitigate risks effectively.
Listeners will gain insights into the impact of geopolitical tensions, the rise of ESG requirements, and the crucial role of generative AI in transforming third party risk management. This episode offers practical advice for businesses looking to navigate these challenges and improve their risk management strategies.
Key Insights
The Importance of Third Party Risk Management
In this episode, Jag Lamba highlights the critical role of third party risk management in today's business landscape. He points out that companies, especially large enterprises, often work with tens of thousands of vendors, making it essential to manage these relationships effectively. Jag emphasizes that third party risks are not just about compliance but also encompass business risks, including information security, privacy, and reputational damage. He explains how the evolving geopolitical landscape, with its increasing regulations and geopolitical tensions, adds to the complexity of managing these risks. Jag stresses the need for companies to adopt robust third party risk management practices to protect their operations and maintain their reputation in a highly interconnected and volatile world.
Leveraging AI for Risk Management
Jag Lamba discusses the transformative potential of generative AI in managing third party risks. He explains that AI can automate the process of sifting through vast amounts of data, identifying risks, and ensuring compliance with new policies. For instance, AI can scan vendors to determine compliance with new regulations, analyze SOC 2 reports, and flag potential issues. This capability is particularly crucial as companies face an increasing number of regulations and the need to manage large volumes of data. Jag shares that AI can help companies stay ahead of emerging risks and respond more effectively to incidents like security breaches. By leveraging AI, companies can reduce the burden of manual processes and focus on strategic risk management, enhancing their overall resilience.
The Role of ESG in Third Party Risk Management
Environmental, Social, and Governance (ESG) considerations are becoming a significant driver of third party risk management. Jag Lamba explains that companies are facing both external pressures from regulators and internal pressures from boards, employees, and customers to adopt sustainable and ethical practices. He notes that the demand for more sustainable and ethical products is reshaping how companies approach third party risk management. Jag highlights that ESG regulations are not just a compliance requirement but also an opportunity for companies to enhance their reputation and attract customers. He underscores the importance of integrating ESG considerations into risk management strategies to meet these growing demands and stay competitive in the market. This integration helps companies build trust with stakeholders and ensures long-term sustainability.
