Watertight cybersecurity is a necessity in today’s business landscape. Fraught with privacy and safety threats, the online world in which virtually every start-up operates needs to be constantly monitored.
Clients are asking to see proof of safety and security measures that are being implemented to protect their data, and certification is a sure-fire way to offer them the assurance that they need.
The first step in obtaining certification is deciding which standard to go for. The decision comes down to two almost-equal frameworks – ISO 27001 vs SOC 2.
What’s the difference between SOC 2 and ISO 27001?
SOC 2 and ISO 27001 are similar, but with enough differences to make it clear to anyone who has a good understanding of each, which one will suit their organisation. That’s why it’s vital that you understand the difference between SOC 2 and ISO 27001 before deciding which one you’ll go for.
What is SOC 2?
Developed by the American Institute of CPAs, SOC 2 stands for Systems and Organisation Controls 2. It’s a security framework that outlines how companies should protect their customers’ data using guidelines around security, availability, processing integrity, confidentiality, and privacy of customer data.
These 5 categories form the TSC (Trust Services Criteria) that must be implemented across the organisation and IT infrastructure of your company if you choose SOC 2.
To find out more, have a look at this useful blog: ‘SOC 2, who?’
SOC 2 gives you:
- Improved information security practices
- Cost savings due to reduced costs related to breaches
- A competitive advantage thanks to greater confidence from customers and suppliers
- Improved compliance with legal and regulatory requirements
What is ISO 27001?
In our article on the definition of ISO 27001, we answer this frequently asked question. In short, ISO 27001 was published in 2005 by the International Organisation for Standardisation and the International Electrotechnical Commission. It’s a standard for information security management systems (ISMS) which uses the CIA triad (confidentiality, integrity and availability) to protect data.
ISO 27001 gives you:
- Greater protection of information assets
- Cost savings due to reduced costs related to breaches
- Reduced risk of information breaches
- Increased efficiency and effectiveness of security management
- Improved compliance with legal and regulatory requirements
- Greater confidence from customers, partners, and shareholders
The most evident difference between the two frameworks is that, while ISO 27001 develops an ISMS, SOC 2 audits the security systems that are already in place.
Upon completion, organisations receive a certificate for their ISO 27001 audit, while SOC 2 is an attestation.
| ISO 27001 | SOC 2 |
|---|---|
| Certification | Attestation |
| ISMS | Security controls |
| More extensive | Narrow focus |
| International security certification standard | Set of audit reports |
| Prescriptive | Flexible |
Although not specific to ISO 27001 vs SOC 2, perhaps one of the most interesting and under-exposed differences between ISO and SOC is the fact that ISO contributes to all of the UN’s sustainable development goals. Find out how, here.
How do SOC 2 and ISO 27001 differ in scope?
Comparing the scope of each standard is where we really start to see the differences between them.
The scope of ISO 27001 is quite extensive. It provides a charter of data management, and outlines how a company can prove that they have a functioning ISMS. It audits the overall effectiveness of an organisation’s Information Security Management System using over 100 controls which fall into 14 sets:
Annex A.5 – Information security policies (2 controls)
Annex A.6 – Organisation of information security (7 controls)
Annex A.7 – Human resource security (6 controls)
Annex A.8 – Asset management (10 controls)
Annex A.9 – Access control (14 controls)
Annex A.10 – Cryptography (2 controls)
Annex A.11 – Physical and environmental security (15 controls)
Annex A.13 – Communications security (7 controls)
Annex A.14 – System acquisition, development and maintenance (13 controls)
Annex A.15 – Supplier relationships (5 controls)
Annex A.16 – Information security incident management (7 controls)
Annex A.17 – Information security aspects of business continuity management (4 controls)
Annex A.18 – Compliance (8 controls)
The scope of SOC 2 is not as broad and merely shows how an organisation has implemented essential data security controls. However, it does provide a certain amount of flexibility for organisations who want to upgrade their compliance.
E.g. Within the 5 aforementioned TSCs, there are 64 requirements. Organisations must have policies and procedures in place to fulfil these requirements. For a detailed understanding of the 64 requirements, have a look at this article by Nicole Hemmer.
How do SOC 2 and ISO 27001 differ in market applicability / region?
SOC 2 is mainly used in North America while ISO 27001 (at this stage) is preferable for outside the US. Apart from this, there really is no difference in terms of regional applicability.
As for markets, both frameworks apply to any and all markets, so it really comes down to personal preference and what you believe your customers will find more reassuring in terms of security.
How are the certification processes different?
There’s no difference really, except that the ISO certification must be conducted by an auditor, while the SOC 2 accreditation can only be conducted by a licenced CPA.
According to the official SOC 2 site, ‘Strictly a SOC 2 report is not a certification. It is a service organization control report with an assurance report in accordance with SOC 2 and/or ISAE 3000. Generally, in the market often is referred to as a SOC 2 certification.’
Both SOC 2 and ISO 27001 require that companies go through a four-phase process: gap analysis, risk assessment, implementation and certification.
Different outcomes between SOC 2 and ISO 27001 processes
Meanwhile, both standards follow similar processes but the outcomes are different.
| ISO 27001 | SOC 2 |
|---|---|
| ISO 27001 auditors will assess management processes with your organisation, management of vendors, network security and asset management. | SOC 2 auditors will look at internal controls with regards to financial reporting, security and compliance. |
| ISO 27001 is certified by an ISO 27001-accredited certification body. | SOC 2 is attested by a licensed CPA firm. |
| A certificate of ISO 27001 is valid for three years with a surveillance audit every year. | From the date of the report, type 1 and type 2 SOC 2 reports are remain valid within the industry for 12 months. |
Perhaps the key phrase when looking at the two frameworks is ‘certification’. ISO 27001 is exactly that – a certification. It provides you with an official piece of paper that you can hang on your wall to show that you’re certified.
ISO 27001 is definitive – either you’re certified, or you’re not. There’s no in between. However, even if you get your certificate, your auditor might make recommendations for addressing any minor (or even major) non-conformities. These should be addressed as quickly and thoroughly as possible.
As opposed to a certificate, the SOC 2 attestation is a lengthy document that does not give you an official ‘pass’ or ‘fail’. The final outcome is an opinion provided by a licensed CPA (Certified Public Accountant).
Which different opinions can be applied in your SOC 2 attestation report?
There are 4 types of opinions that could be applied in your SOC 2 attestation report:
Unqualified Opinion
An unqualified opinion means that your audit was successful and the controls were designed, implemented and are operating as they should be. Basically, you passed.
Qualified Opinion
Some controls weren’t designed or aren’t operating as they should be. Although this is unofficially a ‘fail’, the controls that weren’t quite up to scratch might not have any impact on your customers (depending on who they are).
Disclaimer Opinion
If the CPA can’t provide an opinion because of a lack of sufficient information, they will give a disclaimer opinion.
Adverse Opinion
This speaks for itself. The CPA wasn’t happy with the controls and is recommending that customers shouldn’t trust your systems.
The similarities between these two compliance frameworks
As similar as they are different, SOC 2 and ISO 27001 both carry greater data security assurances.
Both standards cover important information security areas and, although neither one is mandatory, both assist companies in building trust, remaining compliant, keeping abreast of their own data and security practices and IT infrastructures, continuously improving data security.
SOC 2 and ISO 27001 are audited by an independent third party and take approximately the same amount of time to complete.
Which one is best for your business?
When should you choose SOC 2?
You might prefer SOC 2 if:
- You operate in the US alone
- You already have an ISMS in place
When should you choose ISO 27001
ISO 27001 is for you if:
- You work with companies in Europe and/or Asia, and American companies that operate outside the States
- You want to develop an ISMS
Frequently asked questions about ISO 27001 and SOC 2
Can you use ISO 27001 and SOC 2 at the same time?
Yes, you can use both ISO 27001 and SOC 2 frameworks at the same time. ISO 27001 is an information security management system (ISMS) framework that provides a systematic approach for managing sensitive company information, whereas SOC 2 is a set of auditing standards designed to assess the security, availability, processing integrity, confidentiality, and privacy of cloud-based services. Implementing both frameworks can help to ensure comprehensive security controls and improve the overall security posture of your organization.
When is SOC 2 certification not enough?
SOC 2 certification may not be enough in certain situations, such as:
- When you need to comply with specific regulations or standards that require ISO 27001 certification.
- When you need to demonstrate a strong commitment to information security to clients or partners who require ISO 27001 certification.
- When you need to expand your business globally and want to comply with international information security standards.
- When you want to implement a comprehensive information security management system that covers all aspects of your organization’s information security.
I have a global clientele. Which compliance framework should I use?
If you have a global clientele, it is recommended that you implement both ISO 27001 and SOC 2 frameworks to ensure comprehensive information security controls. ISO 27001 is an internationally recognized standard for information security management, and SOC 2 is widely used in the US for assessing the security of cloud-based services. Implementing both frameworks can help to meet the requirements of your clients across the globe and demonstrate your commitment to information security.
How do I get buy-in from leadership to use either compliance framework?
To get buy-in from leadership to use either compliance framework, you can:
- Explain the benefits of the framework, such as improved security posture, compliance with regulations and standards, and increased client trust.
- Outline the costs and resources required for implementation, and the potential ROI in terms of improved security and increased business opportunities.
- Discuss the risks of not implementing the framework, such as data breaches and regulatory fines.
- Provide case studies or examples of organizations that have successfully implemented the framework and the benefits they have achieved.
- Involve leadership in the decision-making process and seek their input and support throughout the implementation process.
Can I get ISO 27001 and SOC 2 certification at the same time?
Yes, you can get ISO 27001 and SOC 2 certification at the same time. However, it requires significant resources and planning to implement both frameworks and pass the certification audits. It is recommended that you assess your organization’s readiness for both certifications and develop a comprehensive implementation plan that addresses the requirements of both frameworks. You may also consider hiring a consultant or auditor with expertise in both frameworks to help you with the implementation and certification process.
How can you simplify your compliance?
However, you do what you do and compliance officers do what they do, so finding a compliance company that will further clarify the difference between SOC 2 and ISO 27001 is a must. They will help you decide which standard to implement and even make your compliance journey (almost) fun.
Have a look at how Compleye has simplified compliance for numerous start-ups. Lastly, give us a call and we’ll start you off on your journey by helping you make the decision between these two almost-equal frameworks – ISO 27001 vs SOC 2.
