What is SOC 2 Compliance?
Many organizations prioritize information security, including businesses that outsource critical operations to third parties, be it cloud computing or SaaS, and rightfully so. After all, mishandled data use, especially from network and application security providers, could potentially leave businesses vulnerable to cyber-attacks like data breaches and theft, ransomware, and malicious software installation.
SOC 2 refers to the auditing process that ensures the chosen service providers properly manage data to protect your organization’s interests and client privacy. For any security-conscious enterprise, compliance in SOC 2 is a requirement for considering SaaS providers.
SOC 2 – What is it?
Developed by the AICPA or American Institute for CPAs, the Services Organizational Control 2 defines the criteria for adequately managing consumer information based on five principles – privacy, confidentiality, processing, availability, and security. Due to its importance, many businesses use compliance automation in one form or another to check their adherence to all compliance frameworks continuously and effectively, including SOC 2.
Unlike the PCI DSS, which imposes strict and rigid requirements, the SOC 2 reports remain unique to every organization. Each report designs specific controls with the abovementioned principles based on the organization’s particular practices. As a result, the internal reports offer businesses essential information on how the service provider manages information.
SOC reports are generally categorized into two distinct groups:
- Type 1 is defined as the vendors’ systems and if their design can meet all the trust principles relevant to the business.
- Type 2, on the other hand, details the system’s operational effectiveness.
Third-party auditors generally issue the certification for SOC 2. They assess and evaluate the extent vendors comply with the trust principles as previously mentioned based on existing processes and systems in place.
- Privacy. This principle addresses your system’s collection, retention, use, disposal, and disclosure of information based on the privacy notice of an organization and the AICPA’s criteria.
- Confidentiality. Information is considered confidential when the disclosure and access remain restricted to specific groups or individuals. Some examples are intellectual properties, business plans, price lists, and other sensitive information.
- Processing integrity. The principle behind processing integrity addresses whether the system can achieve its intended purpose. Accordingly, the data processing needs to be valid, complete, timely, authorized, and accurate.
- Availability. As its name implies, availability is the principle referring to system, service, or product accessibility as stipulated in the SLA or contract. Therefore, an acceptable level of performance is established by the parties involved.
- Security. This particular principle is all about the protection of an organization’s system resources. Through access controls, it’s possible to prevent the potential for system abuse, theft, unauthorized access, software misuse, and more.
The role of SOC 2 in ensuring data security can’t be overstated, even if cloud computing and SaaS vendors do not necessarily require it. With its compliance, an organization can ensure the safety and protection of web applications, DDoS, content delivery, and much more. Therefore, it’s recommended to adhere to SOC 2.