With the ever-evolving risks of data security surrounding IT infrastructure, companies, and their customers are investing in robust cybersecurity programs and compliance assessments now more than ever before!
Data breaches can be scary for both parties—customers can have their confidential information hacked into and misused, while companies stand to suffer from huge financial losses, not to mention misplacing the trust that their customers put in them. That is why customers are demanding proof of trustworthy services in most cases, and companies are going for industry-best compliance certifications that provide them the assurance they are seeking.
If you are a B2B SaaS organization, there are two compliance frameworks, either of which your customers may want you to get certified before they trust you with their business. These are SOC 2 and ISO 27001. Both of these focus on strong cybersecurity practices, and the audit reports are globally recognized as acceptable proof of security compliance.
Does this mean that they are similar? The simple answer is no. While these two security standards may show some commonalities, SOC 2 and ISO 27001 essentially serve different purposes. The main distinction is that SOC 2 focuses on demonstrating that you’ve implemented security controls to protect customer data, while ISO 27001 also requires you to demonstrate that you have an operational Information Security Management System (ISMS) in place to manage your InfoSec programs on an ongoing basis.
In this blog, we will discuss the similarities and differences between SOC 2 and ISO 27001, highlight which one you should choose and when, and also elaborate on how to simplify the certification process.
What is SOC 2?
The American Institute of Certified Public Accountants (AICPA) established SOC 2 Compliance (System and Organisation Control 2) as a voluntary compliance standard. It outlines how businesses should manage client data in accordance with the Trust Services Criteria (TSC) of Security, Availability, Confidentiality, Processing Integrity, and Privacy.
In the form of a SOC 2 report, it gives evidence of the strength of an organization’s data protection practices. The report details an independent certified auditor’s appraisal of the organization’s internal controls; the auditor issues the report after analyzing the organization’s control over one or more of its chosen Trust Services Criteria (TSC). SOC 2 is used by organizations to assess their existing security posture and discover opportunities to improve cybersecurity by following the recommended practices mentioned in the SOC 2 report.
What is ISO 27001?
ISO 27001 is a set of standards and regulations for an information security management system (ISMS). It is also known as ISO/IEC 27001 and is one of the leading compliance standards developed by the International Organization for Standardization (ISO) in 2005 in partnership with the International Electrotechnical Commission (IEC).
ISO 27001 primarily helps organizations protect their data systems at an affordable cost. These standards offer best practices for information security management, allowing organizations to assure security across a variety of assets, including intellectual property rights, employee data, financial information, and data from third-party vendors.
ISO 27001 focuses on three critical areas of data protection: Availability, Confidentiality, and Integrity.
What are the differences between SOC 2 and ISO 27001?
SOC 2 refers to a set of audit reports demonstrating the conformity level of information security controls’ design and operation against a set of defined criteria (TSC). However, ISO 27001 is a standard that establishes requirements for an Information Security Management System (ISMS), which is a set of practices for defining, implementing, operating, and improving information security.
The table below provides a full comparison of SOC 2 and ISO 27001 and their application.
|Property||SOC 2||ISO 27001|
|Definition||Set of audit reports that determine whether the design and operation of IT controls satisfy the defined Trust Services Criteria.||Framework that establishes requirements for an Information Security Management System (ISMS).|
|Applicability based on geography||Usually requested by US partners and customers.||Internationally applicable.|
|Applicability based on industry||It can be applied to service organizations from any industry (mostly used by technology-based service companies).||It can be used by any organization of any size within any industry.|
|Time to complete||1-12 months||3-12 months or more|
|Renewal time||Once every year||Once every 3 years|
|What it does||Prove the security level of systems against pre-defined static principles.||Define, implement, control, and improve overall system security.|
|Audit report||Contains detailed descriptions.||Audit findings and certificate.|
|Nature of audit||Design (Type 1) and Operational Effectiveness (Type 2) of internal controls||Design effectiveness of ISMS|
|Difficulty level of passing||Moderate||High|
What are the similarities between SOC 2 and ISO 27001?
There are some areas where SOC 2 and ISO 27001 overlap—here are five similarities between the two.
- Voluntary nature of application
Unlike government-mandated security standards like GDPR Compliance and HIPAA Compliance, ISO 27001 and SOC 2 are not regulatory compliances and are optional. These compliances are performed voluntarily by organizations.
- Design effectiveness of information security systems
Both, as leading compliances, enable companies to design an effective and operational information security strategy by combining policies, procedures, and best practices.
- Builds trust with customers and vendors
Both standards are widely accepted as demonstrable proof that the company is up to date on all security measures for its IT infrastructure.
- Scope overlap pertaining to security measures
More than 80% of security requirements for both frameworks overlap indistinguishably.
- Continuous monitoring
Both standards need the organization to have continuous monitoring practices to be compliant.
Which Compliance Standard should you choose and when?
Before choosing between SOC 2 and ISO 27001, you must assess your organization’s unique security posture and goals, target market, and customer requirements.
When should you use SOC 2?
SOC 2 audits are ideal for organizations that have an Information Security Management System in place but want to double-check that their present standards and procedures are holding up well. It is especially valuable for organizations that wish to target their audits and uncover crucial insights about their security systems and procedures.
Consider SOC 2 audits if you need a less extensive assessment, if your customers are majorly based in the United States, or if they have specifically asked for it.
When Should You Use ISO 27001?
If you need to develop a strong Information Security Management System or have customers all over the world, ISO 27001 could be your choice to start with. Since ISO 27001 is a global standard, accreditation is accepted by many businesses and areas. ISO 27001 is also beneficial for businesses that seek to employ a more stringent assessment standard.
When should you use both?
Consider getting compliant with both standards for a well-rounded security program that is cross-border compliant and also, if you are targeting international customers, not just North American customers.
How to simplify ISO 27001 and SOC 2 compliance?
Obtaining either an ISO 27001 certification or a SOC 2 attestation can be a lengthy process depending on the size and stage of your organization.
Here are a few pointers to help you streamline the process and achieve the best outcomes faster:
- Set your goals and expectations early on
What are your goals for your security organization? Do you have a mechanism in place to manage information security? Specific standards and certifications may be required by different clients or industries. Determine your objectives early on in order to clarify the scope and direction of your compliance effort.
- Choose the right compliance framework for your organization
Once you’ve determined your objectives, you can select the certification or report that best fits them. For example, if you don’t already have an ISMS, ISO 27001 can assist you in developing a compliant framework to create one. Alternatively, if you’re thinking about a SOC 2 report, decide whether you want a Type 1 or Type 2 report based on your goals, scope, timing, and customer requirements.
- Evaluate the resources available on hand
Determine what resources and assistance you will require to complete the task. It can take form months to complete both ISO 27001 and SOC 2 reports. Do you have the necessary personnel, skills, technology, and leadership? Identifying these resources ahead of time can make project planning easier and will help to avoid barriers along the way.
- Get approval and buy-in from key stakeholders
Securing leadership and stakeholder support is critical. Before you begin your compliance project, ensure that you have the appropriate buy-in so that you can obtain the necessary resources and support. Having the appropriate people behind your project will speed up the entire process.
Akitra provides compliance readiness for both SOC 2 and ISO 27001 and much more!
Establishing trust is a crucial competitive differentiator when courting new SaaS businesses in today’s era of data breaches and compromised privacy. Customers and partners want assurances that their organizations are doing everything possible to prevent disclosing sensitive data and putting them at risk, and compliance certification fills that need.
Akitra offers an industry-leading, AI-powered Compliance Automation platform for SaaS companies. Using automated evidence collection and continuous monitoring, together with a full suite of customizable policies and controls as a compliance foundation, our service helps customers prepare readiness for both SOC 2 as well as ISO 27001 compliance standards, along with other frameworks like SOC 1, ISO 27701, ISO 27017, ISO 27018, HIPAA, GDPR, PCI DSS, CMMC, NIST 800-53, NIST 800-171, FedRAMP, and more such as CIS AWS Foundations Benchmark, etc. In addition, companies can use Akitra’s automated questionnaire product to streamline and expedite security questionnaire response processes delivering huge cost savings. Our compliance and security experts will provide customized guidance to navigate the end-to-end compliance process confidently.
The benefits of our solution include enormous savings in time, human resources, and cost savings, including discounted audit fees with our audit firm partners. Customers achieve compliance certification fast and cost-effectively, stay continuously compliant as they grow, and can become certified under additional frameworks using a single compliance automation platform.
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