What is SOC 2?
SOC 2 is a compliance standard developed by the American Institute of Certified Public Accountants (AICPA), a nonprofit trade organization for CPAs. SOC 2 defines various criteria that organizations must meet to keep data about customers secure within business applications.
Who must comply with SOC 2?
SOC 2 is a voluntary compliance framework, unlike compliance frameworks that are defined by law like the GDPR or CPRA, or mandated by industry groups such as PCI DSS. There is no legal requirement for a business to meet SOC 2 compliance rules, nor is there even a strict requirement within specific industries to be SOC 2-compliant.
This does not mean that SOC 2 is something you can ignore. If you offer SaaS applications or other cloud-based services to customers, there is a high likelihood that they will expect you to demonstrate SOC 2 compliance as a condition for doing business. Showing SOC 2-compliance proves that you take cybersecurity seriously, and that you manage your customers’ data in a secure way.
For the same reasons, if you use SaaS apps or similar services, you should demand SOC 2 compliance on the part of your vendors. If a vendor can’t prove SOC 2 compliance, using that vendor’s services could expose you to supply chain attacks or data leakage due to their own security mistakes.
How does SOC 2 compliance work?
SOC 2 is designed to be flexible enough to accommodate a variety of businesses and software stacks. Thus, rather than establishing requirements like which specific tools a business needs to use or how those tools must be configured, SOC 2 is oriented around five high-level priorities, which are known as trust principles.
To be SOC 2-compliant, you must operate your IT systems in a way that aligns with each of these trust principles:
Security: Businesses should implement protections that harden the security of their systems and reduce the risk of unauthorized access.
Availability: Vendors should ensure their services are available by protecting against risks like DDoS attacks or infrastructure failures.
Processing integrity: Businesses must strive to ensure that they maintain data quality and deliver data processing results within the timeframes they promise. Part of this process requires protecting against data loss or manipulation by third parties.
Confidentiality: Businesses should ensure that confidential data is secured through mechanisms like encryption.
Privacy: Vendors must manage private data in a secure way, as well as maintain transparency about how they collect, store and process sensitive information.
Demonstrating SOC 2 compliance
To prove that your business meets SOC 2 compliance standards, you must hire an auditing firm. They will prepare one of two types of SOC 2 compliance reports. Type I evaluates the design of your IT systems and whether they are secure. Type II assesses the operational efficiency of your IT systems.
Type II reports are more detailed and comprehensive, so seeking a Type II report is best for demonstrating the deepest level of SOC 2 compliance. Reports measure a business’s compliance level over a specific period of time, such as a year, and need to be updated periodically to achieve ongoing compliance.
Best practices for achieving SOC 2 compliance
While responsibility for assessing and documenting SOC 2 compliance falls to outside auditing firms, businesses should take steps to ensure they are SOC 2-compliant prior to seeking an audit. Best practices for achieving SOC 2 compliance include:
Continuously audit IT configurations: Misconfigurations are an easy way to fail SOC 2 compliance audits. To protect against this risk, continuously audit your cloud IAM policies, Kubernetes RBAC rules, Active Directory permissions, and other configurations to detect weak settings.
Establish data governance: Rather than leaving it to developers within your organization to decide how to manage data within the software they write, establish comprehensive data governance rules that align with SOC 2 principles.
Document security: The more information you can give SOC 2 auditors about the security controls and processes you have in place, the more easily you will pass your audits.
Continuously update your compliance strategy: Since SOC 2 compliance audits are performed on a recurring basis, you can’t simply become compliant at one point in time and then consider yourself covered. Instead, you need to implement security tools and continuous self-auditing processes that allow you to detect and remediate compliance risks on an ongoing basis.
Getting started with SOC 2 compliance
Although SOC 2 compliance may technically be voluntary, in practice it’s a requirement for virtually any business that collects, stores, manages, or processes data from customers. If you don’t have a SOC 2 compliance strategy in place, now’s the time to get started by deploying the tools and processes that allow you to demonstrate SOC 2 compliance on an ongoing basis.