TL;DR
- ISO 27001 is more accepted internationally.
- While both want you to prove you have the security controls to protect customer data in place, ISO 27001 also wants you to prove you have an operational ISMS ISO
- 27001 usually requires about 50-60% more time to complete than SOC 2.
- In summary: ISO 27001 is harder to achieve than a SOC 2 report
As a provider of business-to-business (B2B) software as a service (SaaS), it is common for customers to request ISO 27001 and SOC 2 compliance reports, as both frameworks demonstrate robust cybersecurity practices and are recognized as industry standards. The primary goal of these certifications is to assure customers that security is of utmost importance to the organization.
Determining which compliance certification to pursue depends on various factors, which are discussed in detail in this article. By examining the differences and similarities between ISO 27001 and SOC 2 frameworks, their level of overlap, and the requirements for achieving compliance, businesses can make informed decisions about the certification(s) that best align with their goals and priorities.
ISO 27001
ISO 27001 is an internationally recognized standard for information security management systems (ISMS). It provides a systematic approach to managing sensitive information, including policies and procedures for risk management, asset management, and access control. The standard specifies the requirements for establishing, implementing, maintaining, and continually improving an ISMS to protect against information security risks.
Some key features and benefits of ISO 27001 include risk assessment and management, implementation of security controls, and continuous improvement of the ISMS. By obtaining certification, organizations can demonstrate to their customers and stakeholders their commitment to information security and compliance with industry best practices.
Read more abour ISO 27001 here
SOC 2
SOC 2 is an auditing framework developed by the American Institute of Certified Public Accountants (AICPA) to evaluate and report on an organization’s internal controls related to security, availability, processing integrity, confidentiality, and privacy. The framework aims to assess how well an organization’s internal controls safeguard customer data and other sensitive information.
Some key features and benefits of SOC 2 include an independent audit process, a comprehensive approach to evaluating internal controls, and the ability to meet customer demand for assurance of information security. By obtaining SOC 2 certification, organizations can provide their customers with an independent and trustworthy assessment of their security practices.
Comparison of ISO 27001 and SOC 2
Differences in scope and focus:
- ISO 27001 focuses on creating and maintaining an Information Security Management System (ISMS) that covers the entire organization, while SOC 2 is more narrowly focused on the controls that an organization implements to safeguard customer data.
- ISO 27001 has a broader scope and covers a wider range of information security practices, while SOC 2 is specific to service organizations that store, process, or transmit customer data.
Differences in audit requirements:
- ISO 27001 requires an external auditor to assess and certify the organization’s ISMS, while SOC 2 requires an external auditor to evaluate and report on the organization’s controls related to the TSC.
- SOC 2 requires the organization to undergo a Type 1 and Type 2 audit, while ISO 27001 only requires a single audit.
Pros and cons of each standard:
- ISO 27001 is more flexible and can be applied to any industry, while SOC 2 is specific to service organizations that store, process, or transmit customer data.
- SOC 2 provides a comprehensive evaluation of internal controls related to customer data, while ISO 27001 provides a more general approach to information security management.
- ISO 27001 is a globally recognized standard, while SOC 2 is more common in North America.
- Implementing either standard can be time-consuming and costly, and the choice of which standard to pursue depends on the organization’s goals and priorities.
Market Applicability: While SOC 2 is mostly sought by businesses with customer bases in the United States, ISO 27001, in comparison, has a broader appeal and is accepted as a security standard the world over.
In summary, both ISO 27001 and SOC 2 have different scopes, focuses, and audit requirements. The right choice depends on the industry, size, and information security needs of the organization. Both standards have their own benefits and drawbacks, and organizations must assess which one is the best fit for their needs.
Table : Comparison of ISO 27001 and SOC 2
| ISO 27001 | SOC 2 | |
| Focus | Comprehensive approach to information security management | Narrowly focused on controls related to customer data |
| Scope | Covers the entire organization | Specific to service organizations that handle customer data |
| Accreditation body | National Accreditation Board | AICPA |
| Target Market | International | United States |
| Timelines | The ISO 27001 compliance can take 6-12 months. | It takes about 6-12 months to become SOC 2 compliant. |
| Applicability | Can be applied to any industry | Specific to service industries that handle customer data, such as healthcare, finance, and technology |
| Benefits | Globally recognized standard, comprehensive approach to information security management | Provides assurance to customers that the organization has effective controls in place to protect their data |
| Renewal Period | The ISO 27001 certification is valid for three years. There are surveillance audits once every year. | The SOC 2 compliance needs to be renewed every year (audit once every year) |
Which Standard is Right for Your Business?
When choosing between ISO 27001 and SOC 2, there are several factors to consider, including:
Industry
SOC 2 is specifically designed for service organizations that handle customer data, such as healthcare, finance, and technology, while ISO 27001 can be applied to any industry.
- Examples of businesses that might choose SOC 2: A healthcare provider that stores patient data in the cloud, a payment processor that handles credit card data, or a technology company that provides Software-as-a-Service (SaaS) to clients.
- Examples of businesses that might choose ISO 27001: A retail company that handles sensitive customer information, a manufacturing company that wants to secure its intellectual property, or a professional services firm that wants to protect its confidential client data.
Size of Organization
Implementing either standard can be a time-consuming and costly process, and the resources required may be a factor in choosing which standard to pursue. ISO 27001 might be more manageable for smaller organizations with fewer resources, while larger organizations might opt for SOC 2 due to its narrow focus on controls related to customer data.
Information security needs
The organization’s specific information security needs should also be taken into account when choosing between ISO 27001 and SOC 2.
- ISO 27001 provides a comprehensive approach to information security management, while SOC 2 focuses specifically on controls related to customer data.
- Organizations that prioritize a broad approach to information security may choose ISO 27001, while those that primarily focus on protecting customer data may choose SOC 2.
In summary, when deciding between ISO 27001 and SOC 2, organizations should consider their industry, size, and specific information security needs. Both standards have benefits and drawbacks, and the choice ultimately depends on the organization’s goals and priorities.
ISO 27001 and SOC 2 similarities
ISO 27001 and SOC 2 have some similarities, despite their significant differences. Here are some of the ways in which they are similar:
- Voluntary frameworks: Neither ISO 27001 nor SOC 2 is a regulatory compliance requirement; both are voluntary. Organizations choose to undertake these certifications as a matter of choice rather than due to regulatory pressure, unlike mandatory frameworks such as GDPR Compliance and HIPAA Compliance.
- Security assessment: Both frameworks enable organizations to assess their security practices, identify strengths and weaknesses, and manage risks through internal risk assessments.
- Effective information security systems: Both frameworks help organizations design effective information security systems through a combination of policies, procedures, and best practices. Build trust: Both standards are widely recognized as ways for organizations to demonstrate the robustness of their security practices and build trust with customers and vendors.
- Scope overlap: There is an overlap of approximately 80% in terms of security requirements between the two frameworks.
- Continuous monitoring: Both frameworks require ongoing compliance efforts, including continuous monitoring, rather than being one-off projects.
Conclusion
Choosing between ISO 27001 and SOC 2 requires careful consideration of an organization’s specific needs, size, industry, and information security priorities. ISO 27001 offers a comprehensive approach to information security management and can be applied to any industry, while SOC 2 is more narrowly focused on controls related to customer data and is specific to service organizations that handle customer data. Both standards have their own benefits and drawbacks, and the choice ultimately depends on the organization’s goals and priorities.
Despite their significant differences, ISO 27001 and SOC 2 also share some similarities, such as being voluntary frameworks, assessing security practices, designing effective information security systems, building trust with customers and vendors, having overlapping scope, and requiring ongoing compliance efforts.
Implementing either standard can be a time-consuming and costly process, and it’s essential to have a dedicated team and commitment from top management to ensure successful implementation. By carefully considering the factors outlined in this article, organizations can make an informed decision about which standard to pursue and ensure that their information security practices are robust and effective.