SOC 2 Compliance Explained
Introduction to SOC 2
What Is SOC 2?
Imagine you're signing up for a new cloud service that will store your company's most sensitive financial data. How do you know you can trust them? You need some proof that they take security seriously. This is where SOC 2 comes in.
SOC 2 isn't a law, but a voluntary compliance standard for service organizations. It was developed by the American Institute of Certified Public Accountants (AICPA) to specify how organizations should manage customer data. Think of it as a report card for how a company handles data security and privacy.
System and Organization Control (SOC) 2 Type 2 is a compliance framework developed by the American Institute of Certified Public Accountants (AICPA) that focuses on how an organization’s services remain secure and protect customer data.
Achieving SOC 2 compliance shows that a company has established and follows strict information security policies and procedures. It gives customers and partners confidence that their data is being protected.
The Five Trust Principles
SOC 2 is built on five core principles called the Trust Services Criteria (TSC). These are the benchmarks used to assess a company's systems and controls. An organization can choose to be evaluated on any combination of the five criteria, but one is always required.
The framework contains 5 Trust Services Categories (TSCs), which contain criteria to evaluate the controls and service commitments of an organization.
The foundational principle is Security, which focuses on protecting information and systems from unauthorized access, unauthorized disclosure of information, and damage to systems that could compromise the availability, integrity, confidentiality, and privacy of information or systems.
The Security category is mandatory for any SOC 2 report. The other four are optional.
The other four principles are:
| Principle | Focus |
|---|---|
| Availability | Are systems accessible and operational as promised? This covers network performance, monitoring, and disaster recovery. |
| Processing Integrity | Is data processed completely, accurately, and on time? It ensures that system processing meets its intended purpose. |
| Confidentiality | Is sensitive information protected from unauthorized disclosure? This applies to data like business plans, intellectual property, or financial reports. |
| Privacy | How is personal information handled? This criterion addresses the collection, use, retention, disclosure, and disposal of personally identifiable information (PII). |
While Confidentiality and Privacy sound similar, they have a key difference. Confidentiality can apply to any type of sensitive data an organization wants to protect. Privacy, however, applies specifically to personal information collected from individuals.
What is the primary purpose of a service organization achieving SOC 2 compliance?
Which of the five Trust Services Criteria (TSC) is mandatory for any SOC 2 audit?
SOC 2 provides a clear, standardized way for companies to demonstrate their commitment to data security and privacy, building a foundation of trust with their customers.