Full definition
Risk-based due diligence is defined as: Risk-based due diligence is the practice of scaling the depth of supplier review to the risk that supplier presents, rather than applying the same checklist to every third party.
Risk-based means a stationery reseller and a payroll processor do not receive the same treatment. The stationery reseller gets a light-touch onboarding; the payroll processor gets full security review, DPA, DPIA and annual reassessment.
The prerequisite is a supplier segmentation model - a way of tiering suppliers by criticality and sensitivity so the right depth of review triggers automatically.