ISO 27001 vs. SOC 2: Which Should You Choose for Data Security?

ISO 27001 and SOC 2 are two of the most important compliance frameworks. They both aim to keep your data safe, but they go about it differently. ISO 27001 is comprehensive. It covers all aspects of information security. SOC 2, on the other hand, targets specific areas critical to protecting customer data.

Choosing between them isn't easy. The stakes are high, and the wrong decision could leave your data vulnerable. Below, we look at ISO 27001 vs. SOC 2 to explain their differences and help you make an informed decision.

What Is ISO 27001?

ISO 27001 is the global benchmark for information security management systems (ISMS). It pushes organizations to maintain the confidentiality, integrity, and availability of their information. The standard provides a systematic approach to protect information through risk assessment, continuous improvement, and controls. These include documentation, management responsibility, internal audits, and corrective actions. It also ensures compliance with relevant legal and regulatory requirements and demands collaboration across all departments within an organization.

» Want to know more about ISO standards? Learn the basics of ISO certification

What Is SOC 2?

SOC 2—short for System and Organization Controls 2—is an auditing procedure from the American Institute of Certified Public Accountants (AICPA). It verifies that service providers securely store and process client data according to five Trust Service Criteria (TSC):

1. Security
2. Availability
3. Processing integrity
4. Confidentiality
5. Privacy

Unlike other compliance frameworks with fixed guidelines, SOC 2 is unique to each organization. Companies design their own controls to comply with one or more of the trust principles based on their specific business practices.

ISO 27001 vs. SOC 2: Common Ground

Both standards focus on implementing and maintaining security controls. They help organizations protect sensitive data and manage information security risks effectively. In fact, they share many of the same controls for policies, processes, and technologies designed to protect sensitive information. These overlapping controls cover critical areas such as:

• Risk management processes
• Access controls for employees and contractors
• Physical security measures
• Employee training in data security and breach prevention

But they take different approaches. Here's a quick comparison:

ISO 27001 vs. SOC 2: Scope

ISO 27001 covers the entire ISMS and various security-related aspects. It requires organizations to establish, maintain, and continuously improve their ISMS. The standard is prescriptive. It mandates the implementation of all 93 controls, which span different areas of information security. This ensures a well-rounded approach to data protection.

By comparison, SOC 2 has a more targeted scope. It focuses on particular services or products and addresses specific TSC relevant to the organization's operations. For example, SOC 2 audits can be limited to one mandatory criterion: Security. The inclusion of extra criteria depends on the company's services and customer requirements. This flexibility allows teams to implement anywhere from 70 to 150 controls—depending on their selected TSC.

ISO 27001 vs. SOC 2: Market Applicability

ISO 27001 is an internationally recognized standard. It's suitable for organizations of all sizes and industries, particularly those with a global presence or international clients. The standard is widely used in IT, finance, telecommunications, and healthcare. While vendors may not specifically request ISO 27001 certification, it can help win enterprise clients due to its credibility and reputation. ISO 27001 is especially popular outside of North America—where it's considered the gold standard for information security compliance. European and Asian clients usually expect it. 

In contrast, SOC 2 is more closely associated with North America. It often applies to companies operating in the United States, particularly in the technology sector. Here, the SOC 2 Type 2 report has become the industry standard for third-party information security compliance. Cloud service providers, SaaS companies, and IT services firms widely adopt it.

ISO 27001 vs. SOC 2: Certification Process

ISO 27001 and SOC 2 both require an external audit to certify compliance. However, there are differences in the auditing bodies, the process, and the resulting documentation.

ISO 27001 Certification Process

To achieve ISO 27001 certification, an organization must be audited by an accredited certification body. The process involves several key steps:

1. Set up an ISMS based on the ISO 27001 standard.
2. Conduct a comprehensive risk assessment to identify potential threats and vulnerabilities.
3. Put appropriate security controls in place to mitigate identified risks.
4. Document all policies, procedures, and controls in line with ISO 27001 specifications.
5. Go through a two-stage audit:
   1. Stage 1: Documentation review to assess ISMS readiness and identify gaps.
   2. Stage 2: Formal audit to test the effectiveness of the implemented controls.
6. Address any non-conformities identified during the audit.
7. Receive ISO 27001 certification upon successful completion of the audit.

An accredited body conducts the audit, which can take three to 12 months, depending on your organization's size, complexity, and security posture. This includes three to six months for ISMS implementation and documentation, one to two months for Stage 1 and Stage 2 audits, and additional time for addressing any non-conformities identified during the audit.

SOC 2 Certification Process

To prove SOC 2 compliance, an organization must engage a licensed CPA firm to perform the audit. The process includes the following steps:

1. Select the relevant TSC for the audit scope.
2. Prepare for the audit by documenting policies, procedures, and controls related to the selected TSC.
3. Engage a licensed CPA firm to conduct the audit.
4. Provide the auditor with the necessary evidence and documentation.
5. Submit to the audit, which involves:
   1. Reviewing the audit scope and developing a project plan
   2. Testing the effectiveness of security controls
   3. Documenting the results and issuing an opinion on the organization's compliance
6. Receive a SOC 2 attestation report detailing the auditor's findings and opinion.

The process typically varies based on the type of report. It can take anywhere between five weeks and 12 months to become SOC 2 compliant.

Note: Both standards involve significant preparation and resources, but ISO 27001 tends to be more comprehensive and time-intensive.

ISO 27001 vs. SOC 2: Which One Is Right for You?

Choosing between ISO 27001 and SOC 2 depends on factors specific to your organization. Keep these points in mind as you decide:

• Industry and regulatory requirements
• Customer expectations and demands
• Geographical focus and target markets
• Existing ISMS
• Available resources for implementation and maintenance

Pro tip: Base your choice between ISO 27001 and SOC 2 on a thorough assessment of your organization's specific needs, risk profile, and compliance standards. 

When to Consider ISO 27001

ISO 27001 may be the better choice for organizations that:

• Have a global presence or serve international clients
• Need a comprehensive and internationally recognized ISMS
• Need to show a firm dedication to information security
• Operate in industries where ISO 27001 is a common requirement
• Want to lay a strong foundation for their information security practices

» Find out why ISO 27001 certification matters for your business

When to Consider SOC 2

SOC 2 may be more suitable for organizations that:

• Primarily serve customers in the United States
• Operate in the technology sector, particularly SaaS or cloud services
• Handle sensitive customer data as part of their core business
• Require a more targeted and flexible assessment of their security controls
• Have an existing ISMS and want to confirm its effectiveness

Make the Right Choice: ISO 27001, SOC 2, or Both?

Both ISO 27001 and SOC 2 are popular certifications for data security. But they serve different purposes and offer distinct benefits.

If you're looking for a comprehensive, globally recognized framework, ISO 27001 is a strong choice. It's ideal for organizations that want a thorough approach to data security. Then again, if you're more focused on protecting specific types of customer data, SOC 2 might be the way to go. It's especially relevant for companies in the tech sector that handle sensitive information.

But you don't necessarily have to choose between them. Many teams combine ISO 27001 and SOC 2 to cover all their bases and show a strong commitment to data security.

The choice is yours. And it's an important one. Your data is your most valuable asset, and protecting it should be a top priority. Take the time to understand your options, and make the decision that's right for your organization. Your customers are counting on you to keep their data safe.

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