SOC 2 vs ISO 27001

As the business world becomes more interconnected, the risk of data breaches and cyber threats has grown significantly. On average, it costs a US-based company almost $10 million to recover from a single data breach. Such grim statistics drive businesses that rely on SaaS solutions to hold service providers to higher cybersecurity standards, including compliance with frameworks like SOC 2 and ISO 27001.

Customers increasingly gravitate towards SaaS providers who can reliably protect sensitive customer data from marauding cybercriminals. Demonstrating cybersecurity compliance for SaaS helps build customer trust while mitigating legal, financial, and reputational risks.

SOC 2 and ISO 27001 are among the most popular frameworks to help service providers bolster their cybersecurity posture. But how do you pick between them?

Dig in as we weigh in on the SOC 2 vs. ISO 27001 debate to help you pick the best cybersecurity frameworks to bolster your cybersecurity posture and head off cyber threats.

What is a SOC Certification?

Although commonly used in many blog posts, SOC certification is a misnomer. It’s widely used to refer to an attestation that a service provider has implemented sufficient cybersecurity controls to protect customer data.

After a SOC audit, you receive a SOC report rather than a SOC certification because there aren’t universally accepted standards for SOC assessments.

A SOC report indicates that a SaaS provider has implemented adequate security measures to deliver the service THEY promise.

Short for Systems and Organization Controls, SOC refers to a set of standards that help measure how well your company controls and safeguards its information. A SOC report provides reassurance and peace of mind companies need to engage a SaaS provider. You have a choice of three types of SOC reports—SOC 1, SOC 2, and SOC 3—to pick from when you need to demonstrate cybersecurity compliance.

SOC 1 uses Statements on Standards for Attestation Engagements 16 (SSAE 16) which was superseded by SSAE 18 in 2017, assures prospects that you can securely handle financial reports and information. A SOC 2 report attests to your company’s capacity to safely control and manage customer data based on five Trust Services Criteria (TSC).

A SOC 3 report is a SOC 2 report without confidential information intended for the general public. After completing the SOC 2 report, the summarized version is prepared, excluding the security tests and their results.

What is SOC 2 Compliance?

SOC 2 compliance means that a service provider employs the best cybersecurity practices related to the 5 Trust Services Criteria when protecting customers’ data. To demonstrate SOC compliance, you must hire an independent auditor to evaluate your IT systems and controls and ensure you adhere to the best security practices.

SaaS providers pursue SOC compliance to improve their cybersecurity posture to stakeholders or potential clients. The audit process helps identify any weaknesses in your cybersecurity armor and helps bridge any gaps. SOC compliance improves your capacity to protect and safely handle sensitive client data. It gives you an edge and increases the likelihood of working with enterprise clients. Such clients are often targeted by cybercriminals looking to access their prime data.

When you need to demonstrate SOC 2 compliance, you have a choice of two reports— the SOC 2 Type 2 vs Type 1. A Type 1 report provides a snapshot of your security controls and design at a single point in time, while a Type 2 report is more comprehensive and evaluates your system’s operating effectiveness over a period of time.

Typically, the choice between the two reports comes down to the timeframe, available resources, and your client’s security needs. Many enterprise clients gravitate toward SOC 2 Type 2 reports because they provide the highest security assurance.

Is SOC 2 a Certification or Accreditation?

A SOC 2 is neither a certification nor accreditation but an attestation. Unlike other standards, SOC 2 isn’t a mandatory cybersecurity framework. Instead, it’s an optional attestation verified by an independent 3rd party auditor.

With SOC 2 compliance, there’s no certifying body—you can hire any certified CPA to audit your system. Despite setting the SOC 2 standards, AICPA doesn’t provide certifications. As such, SOC 2 certification isn’t universally accepted. As such, there’s no pass or fail when it comes to SOC 2 compliance.

A SOC 2 auditor only provides a report detailing your company’s security posture. However, they’ll offer a qualified opinion about your security controls, detailing whether they do or don’t meet the criteria under review. As such, when clients ask about your firm’s security, they wish to view your SOC 2 attestation report.

• SOC 2 Type 1 attestation: It’s a static snapshot that captures your firm’s compliance frameworks at a given date. The auditor will investigate the snapshot to determine if the controls are present but won’t attest to their functionality.

• SOC 2 Type 2 attestation: It’s more comprehensive, and an auditor will investigate the operational efficiency of your controls for 3 to 12 months. As such, a Type 2 audit is more expensive and intensive but provides a more meaningful and highly sought-after assurance.

Instead of a SOC 2 certificate, you’ll receive a SOC 2 report after a SOC 2 audit. A SOC 2 report provides detailed insights into your controls and security measures to reassure stakeholders and clients of your firm’s commitment to data security.

What is the ISO 27001 Certification?

ISO 27001 certification is an international compliance security standard developed by the International Organization of Standardization (ISO). It’s the gold standard for the global cybersecurity best practices in information security and provides a framework to help you establish, implement, and continually improve your Information Security Management System (ISMS).

It sets the requirements that a safe and efficient ISMS should meet and certifies all organizations that meet these standards. ISO 27001 outlines specific security, standardized protocols, and internal policies to help you protect your client data from theft and misuse.

An ISO 27001 certification indicates that your firm meets all the ISO compliance standards and framework requirements. An ISMS implemented to these standards epitomizes cyber resilience, risk management, and operational excellence. It allows you to repulse cyberattacks while guaranteeing data confidentiality, integrity, and availability.

Unlike a SOC 2 attestation, the ISO 27001 certification cost ranges from $50,000 to $200,000. But the actual costs come down to your preferred audit partner, company size, and the nature of your IT infrastructure and security stack.

To protect your firm’s data and lower the risk of cybersecurity threats, you may need to choose between ISO and the NIST CSF. While both serve as standards for cybersecurity, they’re remarkably different. Comparing ISO 27001 vs NIST can help you make an informed choice. ISO 27001 helps certify your security posture, while NIST provides instructions to help you build a robust security program.

Which SOC Report is Closest to an ISO Report?

As far as SOC reports go, the SOC 2 Type 2 report bears the closest resemblance to the ISO 27001 report. Let’s explore some of the similarities:

• Control coverage: ISO 27001 and SOC 2 evaluate your company’s information security controls. While a SOC 2 Type 2 report addresses controls related to the Trust Services Criteria, ISO 27001 is a comprehensive international standard detailing what you need to build an ISMS.

• Control frameworks: Both standards entail assessing and implementing controls. ISO 27001 helps implement controls based on identified risks, while SOC 2 Type 2 entails auditing your controls over a specified timeframe.

• Third-party assurance: An independent auditor must assess your controls and security practices and ensure they meet the set standards for both frameworks.

• Stakeholder assurance: You may use the SOC 2 Type 2 report to reassure stakeholders and clients of your capacity to handle sensitive data safely and securely. An ISO 27001 certification assures stakeholders that your company follows globally recognized information security practices.

Ultimately, the choice between ISO 27001 vs. SOC 1 comes down to whether you need an attestation report or globally recognized certification. You’ll need a SOC 1 report if marketing to US-based clients while an ISO 27001 certification has a global appeal.

What is the Difference Between SOC 2 and ISO 27001 Control Mapping?

SOC 2 control mapping to ISO 27001 entails matching the ISO 27001 standard requirements and controls with the SOC 2 framework criteria and controls. It allows your company to use your current controls and processes to meet the needs of both frameworks. The mapping process offers insights into how the frameworks connect and overlap.

Control mapping helps accelerate compliance by allowing you to complete the requirements of each standard simultaneously. Leveraging the controls, requirements, and criteria overlaps via SOC 2 vs. ISO 27001 mapping saves time, effort, and resources.

Despite the overlaps, the two frameworks approach control requirements from different angles, which triggers differences in control mapping. ISO 20071 takes a holistic approach and covers the entire spectrum of your information security management. Conversely, SOC 2 focuses on controls related to the Trust Services Criteria.

Additionally, the ISO standard provides a risk-based approach to help you identify and assess risks and use the risk treatment plan to select and implement controls. SOC 2, on the other hand, requires you to implement the controls that meet the AICPA-defined Trust Services Criteria.

How Do I Get 27001 Certified?

If your company mainly caters to U.S. clients, you may face the SSAE 18 vs. ISO 27001 dilemma when choosing a framework. While getting ISO 27001 certified is a complex undertaking that requires adequate planning and preparation, it comes with a distinct advantage. An ISO 27001 certification provides a roadmap to help you meet the SSAE 18 (Statement on Standards for Attestation Engagement 18) requirements.

Preparing for ISO 27001 Certification

The preparation required to prepare your firm for ISO 27001 certification depends on its size, complexity, and current compliance standards. Here’s a simplified preparation guideline:

1. Conduct a gap analysis to identify shortcomings against the ISO 27001 requirements.
2. Establish an implementation plan outlining how you intend to fix the identified gaps.
3. Bring your staff up to speed and train them on the ISO standard and your implementation plan.
4. Establish your firm’s ISMS documentation, including procedures, policies, and supporting documentation.
5. Conduct internal audits to establish that your ISMS functions as expected and your employees are proficient with its protocols and procedures.
6. Schedule an external certification audit with an accredited certification body.

The ISO 27001 Accreditation Process

You’ll need to engage an independent, accredited certification body to conduct the ISO 27001 certification process, which comprises two stages:

• Document review: During this phase, the auditor reviews your documentation to ascertain that you’ve deployed the ISMS according to the ISO 27001 standards. The auditor will review your ISMS policy and objectives, statement of applicability, and risk assessment report. You’ll be required to provide evidence that all critical aspects of the ISMS comply with the standards. The auditor will also require records of at least one management review and internal audit.

• Primary audit: Usually happens a few weeks following the stage 1 audit. During this phase, the auditor assesses how you’ve implemented the ISMS with your company. They’ll review your records, observe your processes in action, and interview key employees. As such, you must ensure that your operations comply with all you’ve outlined in the security procedures and policies. In the absence of any significant nonconformities, the certification body will certify your company.

If the auditor uncovers significant compliance issues, they’ll give you a deadline, usually 90 days, to resolve them. On rectifying the problems, you may notify the auditor and attach evidence of the corrective actions. If you do a swell job, the auditor will accept the new measures and proceed with the ISO 27001 certification.

How Much Does it Cost to Get SOC 2 Certification?

The cost of a SOC 2 audit for small businesses ranges from $7,500 to $20,000, depending on the type of attestation. A SOC 2 Type 1 is more affordable and will likely set you back $7,500 to $15,000. 3 Conversely, the more comprehensive SOC 2 Type 2 attestation costs between $12,000 and $20,000.

Ultimately, the cost of getting SOC 2 attestation depends on the size of your firm, the scope of the assessment, the complexity of your IT infrastructure, and your preferred service provider.

Protect Your Business While Winning More Business

The ultimate choice between SOC 2 vs. ISO 27001 comes down to your target audience. SOC 2 attestation is the more affordable option and is ideal for SaaS providers catering to the U.S. market. Conversely, ISO 27001 is more costly and is perfect for service providers catering to a global audience. Alternatively, securing a SOC 2 attestation and an ISO 27001 certification can give your company a global appeal without neglecting your US-based customers. Due to a massive overlap between the two standards, you can save precious time, effort, and resources.

Need help picking the appropriate cybersecurity framework for your business? Schedule a free consultation.