ISO 27001 vs SOC 2

To successfully grow, businesses must be able demonstrate to customers and prospects that they are committed to protecting sensitive data. Being compliant with a highly regarded security framework is an effective way to do that. Two popular choices are ISO 27001 and SOC 2. It can be confusing for businesses to determine which framework makes the most sense. That’s why we wanted to provide this ISO 27001 vs SOC 2 comparison.

Before we get into the comparisons, let’s review each standard.

ISO 27001

ISO 27001 is an information security standard from the International Organization for Standardization (ISO). It is a certifiable framework designed to help organizations protect their data through an Information Security Management System (ISMS). An ISMS is a set of policies and procedures to manage and protect an organization’s sensitive information.

SOC 2

A SOC 2 examination is a report on an organization’s security controls. The standard was developed by the American Institute of CPAs (AICPA). It focuses on the Trust Service Criteria for: Security, Availability, Confidentiality, Processing Integrity, and Privacy. There are two different SOC 2 reports, Type 1 and Type 2, with Type 2 being the more thorough report.

Here are some of the similarities and differences to consider when making the ISO 27001 vs SOC 2 comparison.

Scope

ISO 27001 and SOC 2 have many security requirements in common. So whichever route your organization chooses, you’ll end up implementing many of the same policies and procedures.

Both frameworks allow organizations to customize some of their scope based on their specific needs and operations. SOC 2 offers more flexibility because it doesn’t have a required set of controls.  The organization must have controls that cover the relevant Trust Services Criteria, but they are not defined or prescriptive in how they meet the criteria. Out of the 5 Trust Security Principles, only Security is mandatory. Organizations can implement controls for the other principles as they deem necessary.

ISO 27001 has two separate parts, Clauses and Annex A. There are seven mandatory Clauses, they are:

Clause 4: Context of the Organization: Identify internal and external stakeholders, client lists, regulatory environments, etc.

Clause 5: Leadership: Identify strategic objectives and the necessary resources.

Clause 6: Planning: Detail how security objectives will be met.

Clause 7: Support: Detail how the organization will provide the resources needed to establish, implement, and maintain the ISMS.

Clause 8: Operation: Identify processes to mitigate risks that arise.

Clause 9: Performance Evaluation: Requires the monitoring, measurement, analysis, and evaluation of the ISMS.

Clause 10: Improvement: Identify actions designed to continuously better the ISMS.

Annex A controls are not mandatory, but they are highly recommended. The controls represent a comprehensive set of highly regarded information security best practices. Implementing them provides a strong foundation for your ISMS.

Organizations can tailor their ISMS based on their specific risks and needs, which means some Annex A controls may not be relevant. During your risk assessment you’ll need to identify which Annex A controls are necessary to mitigate the risks you’ve found.

A Statement of Applicability is an essential element of ISO 27001 compliance. This document explains which Annex A controls you’ve chosen to implement or not, and the justifications for your decisions. During the certification audit, you’ll need to demonstrate that the controls in Annex A have been considered and addressed, even if you haven’t implemented all of them.

ISO 27001 vs SOC 2 Market Reach

When you decide between ISO 27001 and SOC 2, consider the location of your customers. Both are global standards, but ISO 27001 is used more widely internationally. Businesses with many customers outside North America may need ISO 27001 certification to meet customer requirements.

Businesses with a customer base in North America are more likely to have customers that require SOC 2 compliance.

Certification vs Attestation

Organizations that can prove compliance with ISO 27001 will receive a certification. To get certified, a business needs to pass an audit to see if its security measures meet the standard. An ISO 27001-accredited certification body must conduct the audit.

SOC 2 is not a certification; it is an attestation. After going through an audit, organizations will get an attestation report with one of the following opinions:

• Unqualified Opinion: The equivalent of a “pass.”
• Qualified Opinion: A mostly clean report but there was some sort of issue found. Organizations can proceed with a Qualified Opinion. They will want to explain to customers why the exception was rare and how they fixed it.
• Adverse Opinion: The equivalent of a “fail.”
• Disclaimer of Opinion: This happens when the required evidence wasn’t provided to the auditor.

A licensed CPA must conduct a SOC 2 audit. Organizations can select their auditor.

SOC 2 vs ISO 27001 Timelines and Workloads

There is no set amount of time it will take to reach compliance with either standard. Estimates to complete a SOC 2 Type 2 report usually range from 6-12 months. For ISO 27001 certification, expect a minimum of 6 months, but the process can take more than a year. The time frame depends on the amount of work needed to meet the requirements.

Typically, ISO 27001 audits are more expensive than SOC 2 audits. This is because they require additional documentation to demonstrate that a compliant Information Security Management System is in place.

Before beginning the formal audit for either framework, organizations should take the following steps to prepare:

1.      Conduct a gap analysis to determine where your current security policies and procedures fail to meet ISO 27001 or SOC 2 requirements.

2.      Identify and implement security controls that will remediate the gaps discovered in the analysis.

3.      Conduct an internal audit to ensure the new controls are effective.

4.      Gather the documentation that will be necessary for the audit.

As with any security standard, a certification or a successful report is not the finish line. To keep a SOC 2 report current, organizations must go through an annual audit. An ISO 27001 certification is valid for three years, but companies must conduct surveillance audits annually.

What About Both?

It could make sense for your business to complete SOC 2 and ISO. If you have customers domestically and internationally, you could very well encounter customer requirements for both. Being able to demonstrate compliance with both frameworks will prove your commitment to data security and potentially distinguish your organization from competitors.

Businesses can work towards both at the same time. Due to the overlapping controls between ISO 27001 and SOC 2, much of the work you do will advance your compliance efforts with both. Just be aware they don’t entirely overlap so there will be standalone efforts for each.

CompliancePoint has helped companies in a variety of industries reach their SOC 2 and ISO 27001 goals. To learn more about how we can put your business on the path to compliance, reach out to us at connect@compliancepoint.com.