Emerging Trends in Vendor & IT Risk for 2025

Introduction

As 2025 approaches, organizations are entering an era of compounding digital risk. Rapid advances in AI, expanding third-party ecosystems, and intensifying geopolitical uncertainty are transforming vendor and IT risk from a technical concern into a strategic priority. The cost of being unprepared is rising—and so is the urgency to act.

This article brings together the consensus of award-winning experts in cybersecurity, vendor governance, and enterprise risk management. Together, we identify the most critical trends shaping vendor and IT risk for the year ahead, offering practical insights to help boards, executives, and risk leaders prepare proactively—not reactively.

From AI-enabled threats and regulatory upheaval to deepening supply chain dependencies, the landscape is evolving faster than most governance models can adapt. Staying ahead in 2025 requires shifting from static checklists to dynamic resilience strategies. This guide is designed to help you do exactly that.

Geopolitical Instability and Its Impact on Vendor Dependencies

Geopolitical shifts are now directly reshaping enterprise vendor ecosystems. As tensions escalate between global powers, businesses face rising risks in cross-border data flows, export restrictions, and sanctions compliance. In 2025, geopolitical exposure is no longer a niche concern—it’s a core component of vendor risk.

Organizations that rely heavily on international suppliers, cloud services, or offshore development teams may be particularly vulnerable. Disruptions caused by war, regulatory crackdowns, or supply chain rerouting can result in service outages, data access restrictions, or reputational damage.

Boards and risk leaders must now factor in political and geographic instability when assessing vendor criticality. This means mapping vendor locations, tracking jurisdictional exposure, and assessing alternate sourcing options in high-risk regions.

For deeper context, the World Economic Forum’s Global Risks Report 2024 outlines geopolitical fragmentation as one of the top five systemic threats—affecting not just global trade, but digital infrastructure and trust in third-party services.

Supply Chain Resilience as a Board-Level Priority

In 2025, supply chain resilience isn’t just a risk function—it’s a boardroom mandate. As digital operations depend on a sprawling web of SaaS providers, cloud platforms, and global subcontractors, the failure of a single critical vendor can ripple across the entire enterprise.

Boards are increasingly demanding real-time visibility into vendor performance, dependency mapping, and systemic risk exposure. This includes identifying concentration risk—where multiple services depend on the same cloud or infrastructure provider—and the potential cascading impact of an outage.

Organizations are shifting from static vendor assessments to dynamic resilience practices. These include vendor tiering, contractual exit clauses, multi-region failovers, and continuous monitoring platforms like SecurityScorecard or Bitsight that offer ongoing risk intelligence and scoring.

The ability to assess and respond to third-party disruptions quickly is now seen as a competitive differentiator—not just a compliance checkbox. Boards must ensure that risk functions are empowered, funded, and integrated into strategic vendor decisions from the outset.

AI-Driven Threats and Deepfake Risk

As generative AI tools become more advanced and accessible, threat actors are weaponizing them in sophisticated ways—many of which directly target vendor ecosystems and internal controls. In 2025, deepfakes, AI-generated phishing, and synthetic identity fraud are expected to escalate dramatically.

One of the most concerning developments is the use of deepfake voice and video impersonations targeting procurement, finance, and vendor management teams. Attackers can now convincingly replicate executives or vendors to authorize payments, change banking details, or manipulate access credentials.

Fraud detection systems and employee training must evolve accordingly. Security teams should invest in behavioral analytics and implement strict verification protocols for sensitive transactions—especially those involving external vendors or remote communications.

Organizations should also monitor the use of large language models (LLMs) by adversaries to craft convincing spear-phishing campaigns or generate fake documentation. The UK National Cyber Security Centre has issued formal guidance on emerging threats from deepfakes and synthetic media, urging businesses to strengthen human and technical verification layers.

AI-driven attacks are fast, scalable, and personalized—making them harder to detect and easier to fall for. As this threat class evolves, it will test both technical defenses and human vigilance across the vendor lifecycle.

Regulatory Expansion: Data, AI, and Vendor Risk

Regulatory scrutiny around vendor and IT risk is intensifying in 2025. New frameworks and updates to existing standards are increasing the expectations placed on organizations to demonstrate control, transparency, and resilience across their third-party ecosystems.

Among the most impactful changes are the EU AI Act, which mandates risk-based governance for AI applications, and the SEC Cybersecurity Disclosure Rules, which now require public companies in the U.S. to report material cyber incidents and describe their cybersecurity risk oversight processes.

In Australia, APRA’s CPS 230 regulation, taking effect in mid-2025, reinforces expectations around operational resilience, including formalized third-party and IT risk management programs for regulated entities.

These evolving standards signal a major shift: organizations must now embed risk accountability across the enterprise—not just in the IT or legal departments. That means real-time vendor risk intelligence, board-level oversight, and documented risk decisions that can be defended under regulatory review.

Falling behind on compliance in 2025 doesn’t just mean fines—it can mean reputational damage, investor scrutiny, and loss of trust in digital partnerships. Forward-thinking companies are already investing in integrated governance platforms to stay ahead of this curve.

Cloud Concentration and the Rise of Fourth-Party Risk

While cloud services offer scalability and speed, over-reliance on a few dominant providers introduces systemic vulnerabilities that are increasingly visible in 2025. Many organizations have unknowingly concentrated risk in a small number of cloud vendors—without a full understanding of the dependencies involved.

Compounding this issue is the rise of fourth-party risk. Most third-party vendors themselves rely on other providers—such as cloud platforms, payment gateways, or data processors—creating a complex web of dependencies. A disruption at one of these underlying layers can cascade up to affect your organization, even when the direct relationship seems secure.

To address this, organizations must implement advanced supply chain mapping and dependency visualization tools. Technologies that trace digital services across third, fourth, and even fifth-party levels are becoming essential for accurate risk assessments.

Additionally, regulators are beginning to focus on concentration risk in critical infrastructure, urging firms to assess whether their cloud strategy aligns with resilience expectations. Mitigation strategies include multi-cloud architectures, data portability plans, and contractual exit clauses with cloud providers.

In 2025, visibility is everything. Without clear insight into where your data lives and which systems power your key vendors, it's impossible to manage digital risk at the level boards and regulators now expect.

Zero Trust and Continuous Control Monitoring (CCM)

In 2025, organizations are moving beyond periodic audits toward continuous, real-time risk visibility. At the core of this evolution are two critical strategies: Zero Trust architecture and Continuous Control Monitoring (CCM).

Zero Trust operates on the principle of “never trust, always verify,” assuming that threats may exist both inside and outside the network. This model is particularly relevant for vendor ecosystems, where users and systems from third parties often access core applications and data. Implementing strict access controls, identity verification, and microsegmentation helps limit lateral movement and reduce the blast radius of breaches.

CCM complements this approach by providing continuous oversight of control effectiveness. Rather than relying solely on annual assessments or vendor attestations, CCM uses automated tools to monitor controls in real time—such as encryption status, access logs, or SLA compliance.

By combining Zero Trust with CCM, organizations gain a proactive security posture. Vendors are no longer assumed to be secure based on static questionnaires or point-in-time reviews—they are continuously monitored and held to evolving standards.

As more enterprises adopt these practices, real-time control assurance will become a standard expectation, especially for high-risk and high-privilege third parties.

Human Factor and Internal Risk Amplification

While much of vendor and IT risk is technical, the human element remains a leading cause of incidents. In 2025, internal factors like burnout, cognitive overload, remote work isolation, and staff shortages are amplifying vulnerabilities across even the most well-defended organizations.

Employees responsible for managing vendors, processing access requests, or handling sensitive configurations are under immense pressure. Mistakes—such as approving the wrong vendor invoice, misconfiguring a system, or skipping verification steps—can have serious consequences. These aren’t always malicious, but they’re no less damaging.

Insider risk also grows in complex vendor environments where accountability is fragmented. Without clear ownership or visibility into who has access to what, internal gaps become harder to catch. Organizations must invest in user behavior analytics (UBA), clear role definitions, and staff training programs tailored to today’s hybrid workforce.

Regular stress-testing of internal controls, rotating responsibilities for critical functions, and integrating human risk metrics into risk dashboards can all help reduce exposure. As threats evolve, managing people risk is just as important as managing software vulnerabilities or third-party integrations.

Strategic Recommendations for 2025 Readiness

To stay ahead of emerging vendor and IT risks in 2025, organizations must shift from reactive controls to proactive, intelligence-driven strategies. The following expert-backed recommendations offer a practical foundation for resilience and competitive advantage:

• Develop a 2025 vendor risk horizon map: Identify emerging risks based on geography, technology stack, and vendor criticality. Plan reassessments and scenario testing accordingly.
• Embed AI risk governance early: Create internal guidelines for evaluating AI vendors, including transparency, explainability, and misuse potential.
• Expand resilience testing to critical vendors: Conduct tabletop exercises and continuity simulations that include third-party response capabilities.
• Elevate risk reporting to the board: Provide high-level dashboards on vendor tiering, control failures, and dependency mapping—presented in business terms, not just technical jargon.
• Integrate behavioral risk insights: Use human factor analytics and cultural health indicators to track internal vulnerabilities before they lead to breaches or vendor missteps.

The organizations that act on these strategies now will enter 2025 not just with stronger defenses—but with clearer strategic confidence in navigating disruption.

Conclusion

Vendor and IT risk are no longer static checklists—they are dynamic, enterprise-wide challenges that require leadership, visibility, and adaptability. The trends shaping 2025 are clear: deeper interconnectivity, smarter threats, stricter regulation, and an urgent need for resilience at every level of the organization.

Risk leaders must recognize that technology partnerships, cloud ecosystems, and AI tools are not just enablers—they are also potential points of failure. Navigating this complexity requires not just better tools, but a cultural shift toward proactive governance and continuous risk intelligence.

Those who prepare today—by strengthening vendor oversight, rethinking human risk, adopting continuous monitoring, and aligning IT risk with business strategy—will be the ones who lead tomorrow. In 2025, resilience won’t be a bonus. It will be a baseline expectation.