Lee Govender

Compliance Success Manager


Why Your Cloud Provider Compliance Alone is Not Enough

Summary: Learn why your cloud service provider’s compliance isn’t enough and why your organization also needs to undergo security compliance.

Many businesses utilize the efficiency of cloud provider services for most (or all) of their IT requirements. However, there’s a common cloud compliance trap that many organizations fail to see until it’s too late. This trap is a misunderstanding of the extent of a cloud provider’s role in compliance. Businesses beware, your cloud provider is not solely responsible for your information security compliance!

It’s crucial to understand that while cloud service providers manage specific aspects of security and compliance, particularly in hosting and maintaining the cloud infrastructure, the ultimate responsibility for ensuring compliance with various regulations (such as GDPR, HIPAA, or PCI-DSS) rests on the business utilizing these cloud services.

But you know us; we wouldn’t simply give a warning and leave you to fend for yourself. So, here’s what you need to know about cloud provider compliance and why it alone isn’t enough. 

What is a cloud service provider?

Cloud service providers are companies that establish public clouds, manage private clouds, or offer on-demand cloud computing components like Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS), and Software-as-a-Service(SaaS). It’s vital to understand the specific compliance responsibilities associated with each service model.

Cloud services can reduce business process costs when compared to on-premise IT. This allows businesses to get the most out of their business model without becoming software and IT experts. Once adopted, cloud service providers (CSP) enable businesses to migrate all (or part) of their IT functions to an external third party specializing in that area. 

It’s important to note that the level of compliance support provided by CSPs may vary depending on the service model they offer. Businesses should carefully assess whether a CSP’s compliance capabilities align with their specific requirements, especially in terms of data protection, privacy, and industry-specific regulations.

The choice of a provider should also factor in their ability to meet specific compliance requirements. But what about their unique compliance needs?

In a nutshell, businesses use a CSP for three core reasons:

  • To streamline and optimize processes
  • To simplify systems
  • To protect data

However, it’s the latter that can be easily misinterpreted and that often needs clearing up. Sure, a CSP may be compliant, but what does that have to do with your compliance?

Understanding the importance of information security compliance

Compliance risks and the cloud

Cloud service providers pose what is known as a third-party risk to compliance.  It’s essential for businesses to not only rely on the CSP’s compliance but also to ensure they themselves meet all relevant regulatory standards. Although it may address immediate business needs and have a robust security framework, its security measures form only a tiny fraction of the overall security compliance for a business. 

Although a CSP compliance can improve your security controls and mitigate third-party risk, they are not responsible for your compliance. Hence, businesses need to consider whether or not their CSP protects their data, services, and reputation appropriately but still need to focus on their own compliance.

The overarching idea of cloud compliance involves the procedures, policies, and practices that monitor data in the cloud and ensure that this cloud environment complies with governance and regulatory requirements. Organizations deal with customers from all over the globe, all of whom are governed by different regulatory requirements, such as GDPR, NIST, SOX, and many others. 

Businesses must better understand where their data is stored as a starting point for cloud compliance. The biggest pro? Storing data in the cloud is possibly the safest way to store data when following best compliance practices. So, for something known as the safer bet, why is your cloud provider compliance alone not enough? Let’s take a look at just some of the reasons.

Over-reliance on your cloud system provider

Many businesses rely heavily on their cloud service provider to stay operational. However, it’s critical to have contingency plans in place beyond what the CSP offers. Which IT tool, service, or platform is used most regularly in your organization? How would it impact your organization if you were to remove it for the day? It will most likely prove to be a significant roadblock. Most CSPs have a reputation for being consistent and stable to ensure minimal disruption to operational activity. However, businesses are encouraged to have a system in place to restore and protect any sensitive data in the event of a functional failure. 

Employee risk

Your cloud service provider may have the most robust security controls in place, but your organization is only as strong as your team’s ability to navigate your own best practices. Regular training and awareness programs are essential to mitigate this risk. Most compliance frameworks, such as ISO 27001 and SOC 2, require a business to implement security awareness training to stay compliant. Within the cloud, your team members may have access to sensitive data or cause accidental data breaches and threats due to negligence. 

This is a prime example of how even though your provider may have the required security controls, it does not mean that your business is compliant. Your team needs to adopt security best practices and security culture to ensure that the provider’s compliance bolsters its own security efforts without the risk of believing that it can ever replace it. 

Data leakage

Another compliance risk that occurs without the proper business security controls is data leakage. Although your cloud service provider ensures that your data is stored safely, data leakage can arise in other ways within your organization.  Businesses need to implement their own measures, such as data loss prevention (DLP) strategies, to complement the CSP’s security measures. However, this can be mitigated with the right encryption, security controls, and restrictive access within the business.

Cyber threats and account hijacking

Account hijacking and unauthorized access are still a real threat to businesses with compliant cloud service providers. Cybercriminals can still easily obtain login information or exploit vulnerabilities within the user’s network. Ultimately, businesses must understand that the responsibility for compliance cannot be outsourced; it involves an ongoing process of risk assessment, implementation of control measures, and regular reviews, and always falls squarely on the shoulders of each organization. This risk is amplified by organizations that do not implement security measures regarding password encryption and/or control.

Compliance and cloud security 

Ultimately, businesses must understand that the responsibility for compliance cannot be outsourced and involves an ongoing process of risk assessment, implementation of control measures, and regular reviews, and always falls right on the shoulders of each organization. As part of this due diligence process of ensuring compliance, organizations are also responsible for ensuring that their cloud providers meet current security and compliance standards. If there is a data violation, non-compliance, or breaches – consequences will most likely fall squarely on the business (not the cloud provider). Unless, it is specifically a cloud provider issue alone. 

The cloud provider is only responsible for undergoing the process of compliance regarding the underlying infrastructure and service they provide. This compliance does not transcend to its users or how they decide to utilize the cloud or follow security best practices. 

How to evaluate cloud service provider security

As an organization migrates to a new cloud service provider, it’s responsible for ensuring that the provider meets the standard security requirements for security compliance. It’s also crucial for businesses to regularly review their CSP’s security and compliance capabilities to ensure they remain aligned with the business’s evolving needs. However, to do this, it’s also essential that they choose a provider that aligns with their current security practices. Here’s how organizations can ensure cloud service provider security. 

Identify the data

Which data will be migrating to the cloud? Identifying the type of data the CSP will obtain and store is essential. Depending on the cloud system or service, the data type will differ. Types of data that can migrate to the cloud include: 

  1. Customer data
  2. Staff details
  3. Email data
  4. Intellectual property

The security measures and compliance expectations will somewhat differ depending on the type of data that migrates to your CSP. 

Conduct a risk assessment

Risk assessments are pivotal in any compliance framework, and most security standards consider it an obligatory step in ongoing compliance. Once you’re aware of the type of data collected and used by your CSP, the next step is to conduct a risk assessment. 

A risk assessment aims to identify any security risks or gaps that could cause non-compliance. This specific risk assessment delves into the data that is now (or will be) handled by the CSP. This includes an in-depth analysis of the providers’ processes and any risks posed by entities the providers connect with, such as hardware support personnel, helpdesk staff, or software developers. 

Run a security assessment

As an organization, you should be aware of your specific compliance requirements. However, seeing if they overlap with the technical controls of a CSP requires in-depth knowledge of your organization’s intricate security and technical controls, as well as a thorough vendor review. Needless to say, this is a much more daunting task than simply skimming over the terms and conditions of each provider. 

A security assessment ensures that the cloud service provider you are using meets an organization’s specific compliance needs and follows industry best practices. 

Your cloud provider won’t do it, but Scytale will

Are you currently unsure how your cloud provider affects your overall compliance? Or if you need to be compliant with SOC 2, ISO 27001 or even HIPAA? We’ve got it covered. Ensure security across your organization with Scytale’s cloud compliance management. Streamline your journey to compliance and ensure that your business (including your CSP) doesn’t leave any room for risks.