AI Vendor Risk Assessment Checklist for Procurement and Security Teams

Enterprises are adopting AI tooling at record speed, yet third-party risk remains a top board concern. According to the Gartner 2023 survey, 45% of executives increased GenAI investment despite unresolved trust issues. Use this checklist to evaluate AI vendors rigorously and align legal, security, and procurement stakeholders.

1. Vendor Profile and Business Resilience

Start with foundational diligence: corporate structure, funding stage, audited financials, and key leadership. Investigate customer references across your industry vertical. Confirm the vendor’s disaster recovery and business continuity plans align with your Recovery Time Objective (RTO) and Recovery Point Objective (RPO) requirements.

2. Security Controls and Certifications

Request recent penetration test results, SOC 2 Type II reports, ISO 27001 certification, or FedRAMP status if applicable. Validate encryption standards, key management, network segmentation, and incident response timelines. For vendors handling regulated data, ensure they follow industry frameworks such as the NIST SP 800-53 controls catalog.

3. Data Usage, Storage, and IP Rights

Clarify how customer data is ingested, processed, and retained. Ask whether your data is used to train shared models, and if so, whether you can opt out. Review data residency policies, anonymisation practices, and sub-processor lists. Confirm contract language that preserves your IP and restricts the vendor from reusing outputs or prompts without consent.

4. Model Risk Management and Monitoring

Assess the vendor’s approach to bias testing, adversarial robustness, and model update transparency. Do they provide evaluation reports, failure mode documentation, and rollback plans? Leading regulators such as the European Banking Authority expect ongoing model risk assessments for critical services.

5. Compliance, Ethics, and Regulatory Alignment

Verify alignment with GDPR, CCPA, the EU AI Act readiness, and industry rules like HIPAA or PCI DSS. Request copies of the vendor’s Responsible AI policy, ethics board minutes, and transparency reports. Multinational firms increasingly require vendors to follow the OECD AI Principles for accountability and human oversight.

6. Commercial Terms and Exit Planning

Negotiate clear Service Level Agreements (SLAs), uptime commitments, and support tiers. Define termination rights, data export formats, and assistance obligations during offboarding. Consider escrow arrangements for critical IP or model weights. Plan pilot phases with quantified success metrics before scaling spend.

Reference Materials and Downloadable Checklist

Build your questionnaire using these reputable resources:

Download the accompanying spreadsheet from Ikalos AI to customize the checklist for your procurement workflow and track vendor responses over time.