SOC 2 vs ISO 27001: Which Certification Do You Need?

According to the 2025 Thales Data Threat Report, 24% of businesses have little or no confidence in identifying where they store their data. If you are a business that handles customer data, you have an obligation to keep it safe. Not doing so can lead to legal troubles, fines, and a degradation of public trust.

Compliance is becoming a standard practice among the top performing organizations, and rightfully so. As we navigate an ever-evolving digital landscape, protecting your clients' information is key. After all, cybercriminals thrive on weak security systems. Creating strong security systems is just the beginning.

To set up a strong information security management system (ISMS), professionals often refer to these two popular frameworks:

• ISO 27001
• SOC 2

In this article, we will go over the difference between scoring your ISO 27001 certification and writing a SOC 2 report. Let's dive right in!

What is ISO 27001?

The ISO/IEC 27001 standard comes from the International Organization of Standardization (ISO) and the International Electrotechnical Commission (IEC). It is widely known around the world as a framework that supports compliance standards. First established in 2005, the framework sections off into four categories:

• Organizational.
• People.
• Physical. 
• Technological.

These categories focus on providing clear requirements for companies to follow, using strategies such as:

• Risk assessment. 
• Access control.
• Incident reporting protocols.

Not only does this security framework require organizations to build information security management systems. ISO 27001 requirements demand your team maintains and continuously improves on them, too.

Achieving certification and compliance through ISO 27001 is a good way to show customers and investors your dedication to protecting their sensitive information. 

What is ISO 27001 Compliance?

Being ISO 27001 compliant means your organization has a better chance of meeting your industry's security regulations. Common regulations supported by ISO 27001 certification are General Data Protection Regulation (GDPR) and Health Insurance Portability and Accountability Act (HIPAA). Keeping on top of your compliance protocols means keeping on top of mounting security threats.

What is an ISO 27001 Audit?

An ISO 27001 audit examines whether an organization's ISMS meets regulatory standards. As well as the organization's own security management requirements. This audit process actually includes multiple types of audits. They consist of 1 internal audit and 3 external audits. These audit types include:

• ISO 27001 Internal audit.
• ISO 27001 Certification audit.
• ISO 27001 Surveillance audit.
• ISO 27001 Recertification audit.

Before beginning your external audit journey, it's suggested you complete these steps first:

1. Define the scope of your ISMS.
2. Decide what information assets you’ll want to represent.
3. Perform a risk assessment.
4. Prepare documentation. 
5. Conduct an internal audit.

Once you complete these steps, you will move onto Stage 1 and Stage 2, certification audits, surveillance audits, and recertification audits. These span years down the road and are pretty intensive, so tune in for an upcoming blog dedicated to this process!

What is SOC 2?

SOC 2 (Systems and Organization Controls 2) is another security and compliance standard. Created in 2010 by the American Institute of Certified Public Accountants (AICPA). This framework specifies how businesses should protect their data from the following threats:

• Unauthorized access.
• Cybersecurity incidents.
• Other vulnerabilities.

SOC 2 provides auditors guidance when evaluating the operating effectiveness of an organization's security measures. More specifically, SOC 2 tells organizations how they should handle customer data stored in the cloud. 

What is SOC 2 Compliance?

SOC 2 defines the requirements for managing and storing sensitive data. This is according to the five Trust Services Criteria (TSC):

• Security
• Availability
• Processing integrity
• Confidentiality
• Privacy

Being SOC 2 compliant means your organization passed your audit. But what is a SOC 2 audit?

What is a SOC 2 Audit?

An audit starts with your team deciding on what kind of SOC 2 attestation report you need: Type 1 or Type 2. Next, you must define the scope of your audit. Ask yourself these questions:

• Am I trying to focus on company level protocols or a specific service?
• What period of time will the audit cover? 
• Which Trust Services Criteria do I want my audit to cover?
• Which information security controls and systems are relevant?

Perform a gap analysis to assess where you stand currently with SOC 2 regulations. By doing this, you can see where you fall short when it comes to compliance.

After that, complete your readiness assessment. A readiness assessment often involves a third-party auditor who helps determine how ready your organization is for an audit. So, pretty much a test run. It's not mandatory, but it sure is helpful.

Once you determine your organization is ready, you can now focus on finding an accredited certified public accountant (CPA). They can issue your company a formal report. This usually takes a few weeks to a few months to complete. But once it's done, you'll have a (hopefully) clean SOC report!

The Difference Between SOC 2 Type 1 & Type 2

I mentioned that there are two different types of SOC 2 reports earlier. Let's go over the difference between the Type 1 and Type 2 reports. SOC 2 Type 1 is an audit report that checks if your systems align with the Trust Services Criteria. While these types of audits are cheaper in comparison, they are also less thorough. 

SOC 2 Type 2 not only examines your systems' design, but also if they work. These audits take longer, up to a year, and are more expensive. However, if you pass the Type 2 audit, there is no question that your organization takes security compliance seriously.

SOC 2 and ISO 27001: Key Differences

So what is the difference between ISO 27001 and SOC 2? I know I just threw a ton of information at you, so let me try to break down the differences in a more bit-sized way. 

First of all, the target market for each framework is vastly different. While SOC 2 focuses on businesses in the United States, ISO 27001 certification is the gold standard when dealing internationally.

The level of flexibility also differs between frameworks. When dealing with SOC 2, you can choose which of the five TSC you want to evaluate. This is in direct contrast to the required 93 Annex A controls when completing an ISO 27001 audit. 

Audit scope is the next key difference to remember. SOC 2 audits are much smaller in scope, and also cheaper. They only need to really focus on one TSC: Security. ISO 27001 covers a much broader scope, requiring:

• Policies. 
• Risk assessments. 
• Audit processes. 
• Annex A documentation. 
• A Statement of Applicability.
• A plan to evaluate and improve your ISMS over time.

Needless to say, this route is more expensive as well. 

Finally, let's go over who needs to perform the audit and the time frames. SOC 2 audits utilize the talents of a licensed CPA firm and finish faster. Type 1 audits usually finish after about a 3 month prep window plus 2 months of an actual audit. Type 2 has about a 4 month prep window coupled with a 3-12 month audit. 

An accredited registrar is in charge of running ISO 27001 certification audits. It takes longer than 4 months to prepare for and can take 6 months for both Stage 1 and Stage 2 audits.

ISO 27001 Vs SOC 2 Certification

The certification process for both of these frameworks is another point of differentiation. Note that ISO 27001 standard certification comes from verifying an organization's compliance with ISO regulations.  While SOC 2 results in an attestation report. This is essentially based on the auditor's opinion on whether the organization meets TSC standards. 

Similarities Between ISO 27001 and SOC 2

We've gone over the differences between ISO 27001 and SOC 2 criteria. We've delved into the compliance and certification processes. Now it's time to discuss what overlap between ISO 27001 and SOC 2 there is. I'm sure after reading up to this point, you may have found some overlap yourself. Let's take a quick look together.

Both frameworks overall demonstrate an organization's dedication to keeping client data safe. They both follow security and compliance standards which are globally respected. Both cover foundational security principles such as:

• Defining security objectives. 
• Conducting gap analysis.
• Implementing necessary controls.
• Accumulating documentation.
• Establishing a method to review and continue to improve security processes. 

They both also need a certified third party professional to complete audits.

ISO 27001 and SOC 2: Which is Best?

So you have the basics all laid out in front of you... but which is the best for your company? SOC 2 or ISO 27001? After all, both are highly respected frameworks that help your organization prioritize data security. 

It might help to consider the following when making a decision on which process is best for you:

• Where your clients are located - International clients and companies call for ISO 27001. While business dealt within the US tends to use SOC 2.
• Do you need specific certification - This is an easy one. If your clients are specifically asking for one type of certification report over the other, simply go with that framework.
• Industry standards - Your choice of framework may depend on the industry you work in. A great example are Software as a Service (SaaS) companies who often require SOC 2.
• The maturity of your current information security process - SOC 2 tends to be a good starting point for beginners in this space. 

At the end of the day, pay attention to what your target market requires. Listen to what your clients and partners ask for.