Compliance Mapping For Regulated Sectors

For these organisations, a third-party risk management (TPRM) framework must do more than assess supplier risks - it must also align with regulatory expectations and stand up to scrutiny during audits, inspections, and reviews. 

A structured approach to compliance mapping helps ensure your TPRM programme is not only effective but defensible. 

Why Compliance Mapping Matters 

Regulators are placing growing emphasis on accountability, resilience, and supplier oversight. Key regulations such as: 

• FCA’s Operational Resilience Framework 

• PRA’s Supervisory Statement SS2/21 

• DORA (Digital Operational Resilience Act) 

• GDPR 

• Solvency II (for insurers) 

…all share a common theme: you are responsible for the third parties you rely on, and you must be able to prove you’ve managed the associated third-party risks effectively. 

TPRM is no longer about internal best practices - it’s about external accountability. 

What Auditors And Regulators Expect  

A third-party risk management framework that meets compliance expectations should demonstrate: 

Evidence of Due Diligence 

• Clearly documented supplier onboarding decisions 

• Risk-based assessments aligned to regulatory risk categories 

• Records of third-party risk scoring, tiering, and rationale for decisions 

Consistent, Justifiable Supplier Decisions 

• Standardised criteria used across all suppliers 

• Documented triggers for enhanced due diligence 

• Clear third-party risk thresholds guiding acceptance, rejection, or escalation 

Internal Controls and Oversight 

• Defined ownership of third-party risk across teams (procurement, risk, compliance, IT) 

• Active monitoring of supplier performance and regulatory status 

• Periodic reassessment and control reviews 

Without these components in place, audits can uncover inconsistencies, outdated records, or non-compliance - putting your organisation at risk of fines, enforcement actions, or reputational damage. 

How FSQS Supports Compliance For Financial Institutions  

The FSQS model is already aligned with the expectations of regulated sectors, helping buyers demonstrate compliance across the third-party lifecycle:

Because FSQS is already widely used all parts of the financial services sector, it enables a level of industry alignment and shared assurance that standalone systems often struggle to achieve. 

Risks Of Poor Compliance

Without a strong compliance-aligned TPRM framework, regulated organisations face: 

• Fines and enforcement for failing to assess or monitor third-party risks 

• Audit failures due to inconsistent records or undocumented decisions 

• Operational disruption if high-risk suppliers go unmanaged 

• Loss of regulator confidence, increasing scrutiny and slowing authorisations 

• Reputational damage if supplier issues escalate into public failures 

Final Thought: Don’t Just Manage Third-Party Risk - Demonstrate Control   

For regulated firms, third-party risk isn’t just about what you manage - it’s about what you can prove. A strong third-party risk management framework should give you both visibility and defensibility across your entire supplier base.