Guide to SOC 2 Compliance
Information security is critical to every business, However, it’s more vital to organizations that deal with cloud computing and SaaS. This guide to SOC 2 Compliance should help you understand the importance of the certification. With these types of businesses, data mishandling can expose enterprises to devastating attacks.
The SOC 2 (Service Organization Control) compliance ensures service providers have the proper control measures to manage data securely. Specifically, it applies to any company that stores customer or stakeholders’ data in the cloud. This guide investigates the various aspects of the certification.
What Is SOC 2?
The American Institute of CPAs (AICPA) developed SOC 2 to define the best practices for handling and managing customer data based on trust principles. As a result, software vendors often adopt SOC 2 compliance. In addition, SOC2 involves policies for securing and protecting customer data.
Unlike most compliance certifications guided by rigid requirements, SOC 2 compliance reports are unique to your company. Therefore, depending on your business practices, you build appropriate controls aligned with the trust principles. The reports you create provide a baseline for your company and its stakeholders on matters of data management.
SOC 2 Trust Principles
SOC 2 compliance has five trust principles that establish the best practices for data management.
1. Security
The security principle ensures that your system is safe from unauthorized access. In addition, it assures your customers that their data is secure and well protected from malicious parties.
The enhanced back-end and front-end security are vital for SOC 2 compliance. Strong passwords and the implementation of two-factor authentication add a layer of protection. Establishing strong network and system firewalls and implementing threat detection systems can keep you safe from security breaches that steal customer data. And since intrusion techniques are constantly evolving, it is vital to make sure your security programs are continuously updated.
Because customer data is valuable, security incidents might arise at any time. Therefore, it’s imperative to establish patterns of known and unknown interactive activity in your system. Most importantly, SOC 2 compliance emphasizes your ability to provide accurate reports on any suspicious activity. It’s vital to demonstrate your organization’s ability to respond to threat incidents promptly and effectively.
2. Availability
This principle covers the availability of your system, services, and products as laid out in a service level agreement. As per the principle, quality and availability are agreed upon by the service user and service provider.
The required performance level may vary from one client to another Therefore, you should focus on meeting each customer’s expectations. In addition, it’s essential to monitor your customer’s needs as they evolve to ensure you are maintaining the best customer service relationships and SOC 2 compliance.
While this principle doesn’t cover system usability and functionality, it includes security issues affecting availability. Therefore, monitoring systems and network performance are essential.
3. Confidentiality
You’ll know how to assign access permission to different data categories within your company when you have well-defined confidentiality rules. Essentially, you should demonstrate that you have the suitable confidentiality measures to govern access to customer data.
However, maintaining confidentiality requires the implementation of other trust mechanisms and principles. For example, most companies ensure confidentiality by encrypting data when in storage and transit. In addition, strict external and internal access controls, network firewalls, and physical access controls can be great ways of safeguarding confidential information.
4. Processing Integrity
The principle of processing integrity relates to how efficient the system is in meeting stipulated goals. To be precise, data processing must be timely, accurate, and provided as requested.
If your business provides financial services, processing integrity plays a significant role in assuring your customers those transactions are accurate, valid, and timely. Besides, it’s a necessary factor for the correction of errors that are bound to arise.
However, this principle relates to data processing and does not necessarily cover the integrity or accuracy of the data. Therefore, to safeguard data integrity, it is vital to implement quality assurance procedures.
5. Privacy
The privacy principle is about ensuring your organization is handling data following accepted privacy principles. Most importantly, the collection, retention, use, disclosure, and disposal of customer data must align with your company’s privacy notice.
According to the Pew Research Centre, at least 93% of adults insist on the importance of being in control of who can access their personal data. Similarly, the group reported that customers want to share confidential information without fear of security breaches.
Become SOC 2 Compliant
Typically, the compliance process can take about six months. To make sure the project doesn’t stall, build a team responsible for the compliance process. The team will define the audit scope and carry out the necessary readiness assessments. Gradually, they will develop security policies and procedures as well as essential implementation plans.
When all appropriate compliance steps are complete, the team will engage a third-party assessor for an audit. Nevertheless, becoming SOC 2 compliant is a voluntary decision unrelated to other compulsory regulations like HIPAA. On the contrary, the need to pursue SOC 2 compliance may come from your customers and stakeholders.
When your customers are concerned about their data security, it’s best to assure them you have appropriate security measures. In the end, SOC 2 is about demonstrating that you have the necessary systems and policies to handle and respond to security incidents in the right way.
Why Pursue SOC 2 Compliance
While your customers may not have started inquiring about your security measures, they most definitely will. However, there are other reasons to seek SOC 2 compliance.
1. Improve Security
The gradual approach necessitated by SOC 2 principles will enhance the overall security of your business. In addition, the process can help you mitigate potential attacks and improve your propensity to win new business by better responding to risk inquiries.
Security and compliance is an ongoing process but not a one-time event. And SOC 2 standards help your company build a sustainable program to enhance your security.
2. Enhance Company Culture
Adopting and implementing security measures can be a daunting task. Initially, employees might feel aggravated by the requirements, but the ultimate outcome is worth it. But as far as building a secure company culture is concerned, the earlier you start, the better. And you may not do it all at once but taking the first steps towards compliance is most vital.
By automating the processes, you can integrate the security protocols into your company culture. This way, it can be easier to scale as your business grows.
3. Helps with Risk Management
Getting ready for SOC 2 compliance and audit will help you develop a system for identifying and mitigating risks. On the contrary, companies that haven’t seriously considered compliance may not be aware of the various security risks and the appropriate mitigation measures.
A systematic compliance process will ensure mitigation against the least perceived risks. Primarily, organizations tend to focus on the more significant risks often overlooking the lesser threats. However, every risk deserves to be taken seriously and addressed with utmost urgency.
4. Provides Documentation
In your organization, it’s crucial to document policies, procedures, and standards. The documentation not only ensures seamless internal communication but also facilitates consistency.
SOC 2 can also help you deal with compliance challenges and win more business. And in case your business is in a growth stage that requires VC funding, mergers, or acquisition, having the correct documentation can go a long way.
Final Words
Running a business can be daunting, especially when security threats are quickly evolving. Hopefully, this guide to SOC 2 compliance has helped clarify the importance of the certification. While SOC 2 compliance is not a compulsory certification, it helps assure your customers and business partners that you are serious about safeguarding their data privacy.
You can learn more about cybersecurity from K2 with our Understanding Key Controls over Technology course or Why Should CPA Firms Prioritize Cybersecurity as a Top Priority?
