Vendor Access Management for Compliance & Risk

If you asked most security leaders whether they could name every vendor with access to their systems right now, and what that access includes, you’d get a lot of uncomfortable pauses. It’s a blind spot that shows up in breach data, where third parties account for52% of reported incidents.

Most organizations have locked down employee access pretty well by now. SSO, MFA, password management, and structured onboarding are standard practices for internal users.

But vendor access never got the same treatment. Most organizations are still running on shared accounts and VPN tunnels with permissions that are way too broad.

Vendor access management (VAM) closes this gap. It brings identity security and third-party risk management together, so external partners get access that’s controlled, scoped, and monitored.

In this guide, we’ll walk through why VAM matters for compliance, where traditional approaches break down, and what a modern vendor access lifecycle looks like.

Why VAM is a critical priority

Formalizing vendor access management pays off in a few specific ways that security and compliance teams both care about:

Reducing the attack surface

Every vendor with system access is a potential entry point. The more vendors you have, and the broader their permissions, the larger your attack surface becomes.

And most organizations don’t have a clear picture of how many third parties can access their environment, let alone what each one can reach.

Research shows that70% of third-party breaches involve overly permissive accounts, which means that vendors routinely have more access than they need. As one security practitionerput it on Reddit, it’s no different than letting a stranger on your network with no supervision:

“Encryption is not the end-all be-all for security posture. Security takes a layered approach. The biggest thing is to reduce your attack surface. RDP being exposed increases the attack surface and leads to brute force attacks, no different than letting a stranger on your network with no supervision.”

VAM reduces this exposure with least-privilege principles to external users. Access gets scoped tightly to the vendor’s actual responsibilities, with time limits that prevent credentials from sitting dormant in your environment.

Meeting compliance and audit requirements

SOC 2 and ISO 27001 both include specific rules around managing third-party access. Auditors want to see how vendors are onboarded, what systems they can access, and how access controls are revoked when the engagement ends. They want logs that show who accessed what and when.

Data shows that50% of organizations still rely on spreadsheets for vendor security risk management, which makes producing this documentation painful and error-prone.

VAM gives you a system of record that maps access to policy, tracks approvals, and generates the documentation auditors expect without last-minute chaos.

PRO TIP 💡: ConductorOne supports compliance frameworks like SOC 2, ISO 27001, and HIPAA out of the box. Access reviews run on schedule, evidence collects automatically, and reports generate with one click when auditors come knocking.

Operational efficiency

Manual vendor access handling doesn’t scale. Every onboarding task needs back-and-forth between IT, security, and whoever owns the vendor relationship. Offboarding is even worse, since nobody flags when a project ends, and credentials should be revoked.

VAM streamlines these workflows. Onboarding a new vendor becomes a standardized process with built-in approvals and scoped permissions. Offboarding happens automatically when contracts end.

Organizations that implement vendor management automation report15%-25% reductions in procurement and operational costs, and it’s largely because the manual work disappears.

Common vulnerabilities in traditional VAM

The security gaps in traditional vendor access management don’t appear overnight. They build up through informal workarounds, undocumented processes, and permissions that expand without oversight.

Most organizations share the same weak points:

• Shared credentials: When multiple vendors share the same credentials, there’s no way to attribute actions or revoke access for a single individual.46% of IT security leaders still store passwords in shared documents, which means that this problem is more common than most organizations want to admit.
• Orphaned accounts: Projects wrap up and contractors move on, but their access often doesn’t. Only29% of companies have a formal offboarding process, which means credentials linger indefinitely and become easy targets for attackers looking for unmonitored entry points.
• Excessive permissions: It’s faster to grant broad access than to scope it properly, so vendors routinely get more than they need. Research shows70% of third-party data breaches involve overly permissive accounts.
• Limited visibility: 63% of organizations don’t have clear visibility into vendor permissions. If you can’t say who has access to what, you can’t protect it, and most cybersecurity teams are working with incomplete information at best.
• Flat network access: VPNs give vendors network access, not application access. Once they’re connected, they can often see far more than their role requires.53% of enterprises breached via VPN vulnerabilities say attackers moved laterally across their networks.

The vendor access management lifecycle

A mature VAM program covers the full arc of a vendor relationship. The controls look different at each stage, but together they keep access intentional, monitored, and time-bound.

Here’s how they fit together:

Phase 1: Onboarding and architecture

Every vendor engagement needs a clear owner, a documented business justification, and an approval chain before anyone provisions access.

This defines accountability from the start and prevents the “we’ll figure it out later” shortcuts that create problems down the line.

Vendors don’t all carry the same risk. A contractor with read-only access to a reporting dashboard is a different story from an MSP with admin credentials in production.

You should tier vendors by exposure level and scale your controls to match:

Make sure you get the technical setup right on day one. Give vendors access only to the specific systems they need, set expiration dates on permissions, require multi-factor authentication, and segment their network access.

Keep a clear record of every access grant – who, what, why, and how long. You’ll need this for audits, compliance checks, and future access reviews.

Phase 2: Active management

What you provision on day one rarely matches what exists six months later. Permissions creep, scope expands, and nobody revisits the original access grant.

You can keep things tight with a few core controls:

• Just-in-time access: Vendors get credentials only when they have work to do and lose them the moment the session ends. No standing access sitting idle between tasks.
• Credential vaulting: Vendors never handle actual passwords. Credentials get injected into vendor sessions directly and rotated after each use, based on the level of access.
• Least privilege enforcement: Permissions granted on day one tend to expand informally. Review the scope regularly and trim anything no longer justified.

Limiting access is half the equation. The other half is knowing what vendors do once they’re inside. Build visibility into the process:

• Session logging: Record vendor activity for audit trails and investigations. Some tools even bring real-time session termination if something looks off.
• Anomaly detection: Define what normal use cases look like for each vendor, and then flag deviations. A contractor who usually logs in at 2 pm, accessing systems at 3 a.m., is suspicious activity that’s worth investigating.

And make sure vendors know what’s monitored and what triggers review. Most vendors won’t push back on reasonable oversight if you explain it before they sign.

PRO TIP 💡: ConductorOne automates just-in-time provisioning so vendors get access only when they need it, scoped to specific resources, with automatic expiration. No standing credentials, no manual revocation, no permissions lingering after the work is done.

Phase 3: Monitoring and auditing

The controls from Phases 1 and 2 only matter if you can prove they work. When auditors arrive, or a security review kicks off, you need evidence ready, not a scramble through email threads and half-updated spreadsheets.

Start with log retention. Define what to keep and for how long:

• Access grants and approvals: Who requested access, who approved it, what systems they can reach, and when the access expires.
• Session logs: What vendors did during each session, which commands they ran, which systems they touched.
• Recertification outcomes: When reviews happened, what the reviewer decided, which permissions changed, or were revoked.
• Anomaly alerts and responses: What triggered the alert, who investigated, and what action they took.

Audit trails should connect every access decision to its justification. When someone asks why a vendor has access, you pull up the original request, the approval, the review history, and any changes. If you can’t show that path, auditors will flag it.

A few metrics help confirm that the program and its functions work in practice:

The point of tracking these is to spot drift before it becomes a gap. If deprovisioning times creep up or re-certifications start getting skipped, you want to know that before your next audit, not during it.

Phase 4: Offboarding

Offboarding needs to be as deliberate as onboarding, with clear steps and accountability at each stage.

Start with a defined trigger. Offboarding should kick off automatically when a contract ends, a project completes, or someone terminates the vendor relationship.

Relying on someone to remember doesn’t scale. Tie deprovisioning to contract end dates wherever possible so access expires without manual intervention.

Revocation covers everything the vendor could access:

• Accounts: Disable or delete across all internal systems the vendor touched.
• Credentials: Rotate shared passwords and API keys.
• Network access: Revoke VPN permissions and remote access paths.
• Physical access: Collect badges, tokens, or hardware if applicable.

Verification matters as much as revocation. Check every system and confirm access no longer exists. Vendors removed from one platform but still active elsewhere are one of the most common offboarding failures.

This is a common pain point. Here’s how one Reddit user explained it, one of the biggest issues is knowing what to offboard. Too often, this can become a guessing game of “wgo had access to what.”

Lastly, document the offboarding the same way you documented onboarding. Record what access existed, when it was revoked, who handled it, and what verification confirmed removal. This closes the loop on the audit trail.

PRO TIP 💡: ConductorOne’s Unified Identity Graph shows every system a vendor can access in one view. When offboarding kicks off, you know exactly what to revoke, and the platform can automate revocation across all connected apps without chasing down permissions system by system.

Best practices for a modern strategy

A mature VAM program combines the right controls with practical habits that hold up under pressure. These practices help close gaps that process documentation alone won’t catch:

• Separate vendor access paths from employee access: Dedicated jump hosts or bastion servers for vendor connections make monitoring easier and limit blast radius if something goes wrong.
• Build offboarding terms into contracts from the start: Define access revocation timelines, sensitive data return rules, and credential handling before the engagement begins. Negotiating these terms after a relationship sours is much harder.
• Default to expiration: Every vendor access grant should have an end date, even if it’s far out. Access without expiration usually becomes access nobody reviews.
• Require vendors to meet security baselines before granting access: MFA capability, endpoint protection, and security awareness training. If a vendor can’t meet basic requirements, they shouldn’t connect to your organization’s systems.
• Tie access reviews to contract renewals: Use renewal cycles as a natural checkpoint to recertify permissions and clean up anything that’s no longer needed.
• Prepare for third-party compromise: Include vendor security breach scenarios in your IR playbook. Practice them. Know who to call, what to cut, and how quickly you can contain the damage before it spreads.

Shifting to identity-centric security

Network-centric security treated the perimeter as the control point. Get past the firewall or connect through the VPN, and you’re in. Once authenticated, they had the run of the place, limited only by whatever segmentation existed.

That approach doesn’t hold up anymore. Attackers know that a compromised vendor account leads to broad network access.

92% of organizations worry about third-party VPN access creating backdoors, and more than half of enterprises breached through VPN vulnerabilities saw attackers move laterally across their networks.

(Source:Zscaler)

Identity-centric security moves the control point. The network stops being the gatekeeper. Instead, every access request runs through identity verification, and vendors reach applications directly without touching the broader environment.

In practice, this means:

• Vendors authenticate at every session, not just once at the perimeter
• Application-level access only, scoped to defined resources
• Context drives access decisions – who’s asking, from what device, and whether the behavior fits
• Trust from a previous session doesn’t carry forward to the next one
• A breach stays contained to what that identity could reach, nothing more

When a vendor account gets compromised, the damage depends on what that account could reach. Through a VPN, that’s often the network.

Through an identity-centric model, that’s a single application. The blast radius shrinks dramatically when access was never broad to begin with.

Modernize your vendor access with ConductorOne

Traditional IAM tools were built for employees, not external partners. They assume users exist in your directory, follow predictable schedules, and stick around long enough to justify the setup overhead.

Unfortunately, vendors break all three assumptions, and the workarounds create exactly the blind spots that attackers look for.

ConductorOne is an AI-native identity governance platform built to manage and secure access for all identity types across any environment. That includes the external users most legacy tools weren’t built for – vendors, contractors, and partners who need controlled access without creating security gaps.

Here’s what it brings to vendor access management:

• Just-in-time access: You can grant vendors temporary access scoped to specific tasks, then revoke it the moment the work is done. No credentials left sitting in your environment between projects.
• Automated access reviews: Set up certification campaigns in minutes and let AI-powered recommendations handle the heavy lifting. Reviewers can see usage patterns, risk signals, and context to make quicker decisions.
• Policy-driven approvals: Not every vendor request deserves the same scrutiny. ConductorOne lets you tier approval workflows by risk level, so high-stakes access gets proper oversight and routine requests don’t pile up in queues.
• Automatic deprovisioning: You can also tie access expiration to contract dates, project milestones, or time limits. When a trigger fires, ConductorOne revokes access without manual intervention.
• 300+ pre-built connectors: ConductorOne integrates with cloud apps, on-prem systems, and homegrown tools in days. Vendors get governed access across your entire stack, not just the apps your IdP happens to cover.
• Policy-aware AI agents: Let AI agents do the heavy lifting on vendor access decisions. They process requests, assess risk against your policies, and escalate only what needs human judgment.
• Unified Identity Graph for centralized access data: Get one source of truth for all identity and access data across cloud, on-prem, and SaaS systems. When someone asks what a vendor can access, the answer is one search away.

Vendor access doesn’t have to be a blind spot. ConductorOne gives security and IT teams the controls they need to work with external partners without unnecessary risk.

Book a demo to see how it works.

Vendor access management FAQs

What is vendor privileged access management (VPAM), and how does it differ from PAM?

PAM secures privileged accounts for internal users, while VPAM applies those same principles to third-party vendors, with extra controls for external vendor access.

Vendors operate outside your security perimeter and often have weaker security practices than your own employees, so VPAM brings tighter session controls, just-in-time provisioning, and credential vaulting built specifically for external parties.

How do we ensure secure remote access without slowing down vendors?

The delays vendors complain about usually come from clunky processes, not enhanced security itself. You can fix that with:

• Self-service access requests with clear approval workflows
• SSO so vendors authenticate once through your identity service provider
• Just-in-time provisioning that grants access on demand
• Automatic expiration that revokes access without manual intervention

Done right, secure access feels faster than the old way.

Why is session monitoring critical for compliance frameworks like GDPR?

GDPR expects you to demonstrate that you control access to personal data, and session monitoring creates the evidence.

You can show auditors exactly what happened, and if a breach occurs, you can determine the scope fast enough to meet the 72-hour notification window.

Do we need specialized access management solutions for vendors?

It depends on scale and complexity. A few vendors with limited access might work fine under your existing PAM or IAM tools. But as vendor relationships grow, the gaps show up fast.

Purpose-built solutions (like ConductorOne) handle the things that generic tools don’t do well – just-in-time provisioning for external users, credential vaulting that keeps passwords out of vendor hands, session recording, and automatic expiration tied to contract dates.