Integrating Information Security Protections in Supplier Agreements: Guidance for Business and Technology Counsel

Designing an information security protocol requires a unified approach that includes robust security policies, ongoing employee education, and effective technology systems (firewalls, encryption, etc.). Company counsel must ensure continuous security audits and well-drafted contracts with business partners and other suppliers that specifically address information security. Any agreement that permits third-party access to a company's network, facilities, data, or confidential information should include ironclad information security protocols.

Incorporating information security into technology contracts involves three critical components: 1. internal and supplier due diligence; 2. contractual protections; and 3. information handling and security procedures and requirements, generally in the form of contract exhibits. Counsel should notify suppliers at the outset that the information they provide during information security due diligence will be relied upon during vendor selection and become part of the contract.

When drafting supplier contracts, business and technology counsel should broadly define confidentiality to include all potentially private information. Agreements should limit the use of subcontractors, address personnel due diligence, and use warranties and indemnity provisions to limit risk. Where appropriate, counsel should attach specific information handling requirements as an exhibit to the contract.

Listen as our authoritative panel explains best practices for integrating information security protections in the supplier contracting process. The panel will discuss key provisions to include in supplier agreements and considerations for customers and vendors during due diligence, contract negotiations, and post-execution.