As digital breaches rise, so do the stakes for companies handling sensitive information. IBM’s 2022 report on data breaches reveals a sobering trend: the average cost of a breach hit $4.35 million globally.
The implications are clear – organizations need to take a proactive stance on data protection to earn and keep client trust. When businesses entrust sensitive information to managed service providers (MSPs), they expect robust security policies that adapt to the unique risks of their industry.
Yet, as practices vary widely, defining effective data safeguards across sectors becomes a daunting challenge. This is where compliance frameworks, which offer industry-specific standards, become essential.
What Is a Compliance Framework?
Compliance frameworks are structured sets of guidelines offering benchmarks to help businesses protect sensitive information. Different frameworks exist to cater to the specific demands of various industries:
General Data Protection Regulation (GDPR) — A cornerstone for data privacy in the European Union.
International Organization for Standards (ISO) — Known for its comprehensive standards across numerous fields.
Health Insurance Portability and Accountability Act (HIPAA) — Aimed at safeguarding health data in the U.S.
Payment Card Industry Data Security Standard (PCI DSS) — For companies handling card payment information.
The Importance of SOC Compliance
System and Organization Controls (SOC), established by the American Institute of Certified Public Accountants (AICPA), is a widely recognized compliance standard. It provides companies with an external validation of their data protection efforts, strengthening customer trust. SOC audits are conducted by certified public accountants who verify a company’s internal systems, providing assurance that data handling meets established security standards.
There are three SOC types:
SOC 1 assesses controls around financial reporting.
SOC 2 applies broader criteria across security, availability, processing integrity, confidentiality, and privacy. Currently, RedlineDCS is self-certified SOC 2
SOC 3 is a public-facing report derived from SOC 2, suitable for general distribution.
Preparing for a SOC Audit
Preparing for a SOC audit is no small task. Organizations must document and refine policies, protocols, and security measures, identifying potential gaps to ensure readiness. Once preparations are complete, a SOC-auditing firm can formally assess the controls.
RedlineDCS' Deal Software and SOC Compliance
RedlineDCS is dedicated to advancing data security for its clients. Currently, the platform holds a self-certified SOC 2 status and is in the process of obtaining a formal SOC 2 audit, which is expected to be completed by 2025. This milestone underscores RedlineDCS’s commitment to maintaining and enhancing its data protection standards as a leading deal management software solution.
Benefits of SOC Compliance
Achieving SOC compliance brings notable advantages:
Establishes Trustworthy Controls: Compliance ensures well-defined procedures for managing sensitive data.
Improves Data Security: The SOC framework highlights areas for data security improvement, helping reduce breach risks.
Strengthens Client Relationships: Certification signals to clients that data security is a priority, fostering trust.
Challenges in Achieving SOC Compliance
Despite its benefits, SOC compliance is not without its challenges:
Complex Requirements: SOC 2, for instance, includes five separate criteria that companies must meet, requiring significant interpretation and resources.
Lengthy Process: Becoming SOC compliant requires a detailed, sometimes protracted effort, often needing external expertise.
Costly Investment: SOC audits are expensive, with the average cost ranging from $5,000 to $60,000.
The journey to SOC compliance may be challenging for organizations committed to data protection, but it remains a worthwhile investment.
Learn more about RedlineDCS' commitment to data privacy and security here.
Written by Sarah Park, a guest writer who formerly danced Ballet.
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