While ISO 27001 certification is undeniably valuable, understanding its associated costs is crucial for budgeting and decision-making.
But before we explore these expenses and provide insights on navigating them effectively, let’s dip our toes into ISO 27001 and what it entails.
What is ISO 27001?
There are three main things you need to know when it comes to ISO 27001.
- ISO 27001 is the leading data security standard, trusted by companies worldwide.
- The certification is recognized as the international gold standard.
- ISO 27001 stipulates specific requirements for establishing, maintaining, and improving an organization’s information security management system (ISMS).
For more information on ISO 27001, take a quick detour to our ISO 27001 under 27001 milliseconds guide, wrapping up the most significant aspects of the leading global security standard. ISO 27001 is valuable, but it doesn’t always come cheap. So, in the spirit of saving (time and money), let’s cut to the chase – what’s the cost of compliance?
Understanding the ISO 27001 certification cost for companies
Now, we could blurt out a ballpark figure right out the gate, but that won’t do you any good. Why? Because each ISO 27001 cost will differ depending on a variety of factors, including:
- The size of your organization
- The approach you’re taking to obtain ISO 27001 (DIY or not)
- The risk profile of your company
- Whether or not you invest in automated compliance (hint-hint)
- The complexity of your Information Security Management System (ISMS)
That being said, saying “it depends” to your CFO won’t suffice when it comes to accurately analyzing and preparing for the cost of your ISO 27001 certificate. That’s why, to get the most accurate price range, companies must consider the following charges.
The preparation costs
To obtain an ISO 27001 certification, your organization needs to implement an Information Security Management System (ISMS). This includes all policies, processes, and procedures that help organizations to protect their information assets. So naturally, depending on the current state of your ISMS, you may have your work (and pricing) increase. If your company has never previously defined an ISMS, preparation costs can range between $10,000 and $60,000 – yikes!
This is because you’ll have to:
- Create security policies and procedures
- Determine and conduct a risk assessment
- Write a Statement of Applicability
- Create a risk treatment plan
- Determine how to measure and test security controls
All of the above needs to happen in preparation for your external audit and certification. However, before that can happen, you need to conduct an internal audit – which also influences the ever-increasing cost.
Internal audit costs
Internal audits are a critical part of assessing your external audit readiness. They allow companies to gauge where to implement corrective actions to prevent them from failing the external audit. Not only does this help companies monitor the effectiveness of their current ISMS, but it falls within the mandatory steps required by the ISO 27001 standard. The cost of an ISO 27001 internal for a small to medium size company will cost between $5,000 to $15,000. This is if companies opt to use an independent consultant.
Although internal audits can be done internally, many small companies cannot afford the productivity loss that comes with the resource-intensive process. Therefore, many companies opt-in for an independent consultant to perform the audit.
Implementation costs
You’ve got the blueprint during the preparation and audit phases, but that doesn’t mean much without successful implementation. Implementation costs are the ongoing expenses that relate to creating and sustaining an effective ISMS. This includes the cost of productivity to get (and stay) compliant and the practical requirements related to ISO 27001 compliance. Examples of ongoing implementation costs include:
- ISO 27001 security awareness programs
- The external audit and certification cost
- Hiring a team dedicated to implementing and continuously maintaining ISO 27001 compliance
- Productivity costs related to updating your ISMS, documenting new risks and policies, managing your certification, and implementing new systems to stay compliant
- Maintaining licenses for software and tools to achieve compliance
Maintenance costs
Once you’ve successfully obtained your ISO 27001 certification, your organization must undergo both an internal and surveillance audit in years two and three, respectively. This can amount to roughly $15,000 for both, annually. In addition to these audits, companies must conduct a recertification audit in year three, adding to the ongoing maintenance costs.
These maintenance costs, including annual internal and surveillance audits, as well as the triennial recertification audit, are essential for ensuring that your ISMS remains effective and up-to-date with evolving security threats and organizational changes.
An additional fundamental cost to consider is the possibility of an ISMS scope extension. What happens if you add new services or locations? Your ISMS scope may expand and require additional auditing.
All-in-all, is it worth it?
Although the different costs of ISO 27001 certification quickly start to stack up, it’s important to put it in perspective. The global average cost of a data breach increased 2.6% from $4.24 million in 2021 to $4.35 million in 2022 — the highest it’s been in the history of IBM Security’s “The Cost of a Data Breach Report.” However, apart from protecting your business from significant financial and reputational loss, there are critical additional benefits of ISO 27001 certification that make it very much worth the fuss (and cost). Key benefits include:
Enhanced security posture
By aligning with ISO 27001, you not only comply with a respected standard but significantly strengthen your overall security posture, making your company less vulnerable to cyber threats.
Better attract and retain new clients
ISO 27001 is known as “The Golden Standard”, proving that your organization has implemented the highest security standard. This provides you with a significant competitive advantage over companies.
Accelerate sales
Clients are increasingly concerned about the safety of their data and hesitant to trust just any organization. Proving due diligence regarding information security can drag out the sales process. Unless, of course, you have the ISO 27001 stamp of approval.
Meet regulatory requirements
Security compliance isn’t always optional. Your compliance journey may differ depending on whether or not you need to meet regulatory framework requirements like NIST CSF (Cybersecurity Framework) and the General Data Protection Regulation (GDPR) of the European Union. This will generally depend on the type of data you handle, your specific industry and your location. ISO 27001 creates a firm foundation for infosec compliance, and generally streamlines and reduces the costs when implementing additional regulatory frameworks.
Reduce human errors
Did you know that up to 90% of security violations and breaches still come from internal threats? Becoming ISO 27001 certified improves your security awareness, posture and overall compliance culture. This mitigates the risk for the vast majority of security threats while simultaneously encouraging an environment of continuous security and compliance.
Are you overpaying for ISO 27001?
As the importance of security compliance increases, along with the popularity of “The Golden Standard’, it’s easy to lose sight of what you should and shouldn’t be paying for, especially when it comes to the complexities of establishing and monitoring your ISMS. However, one thing that should never be over complicated is understanding what you’re paying for and whether or not it’s fair. So, how can organizations trim down on ISO 27001 costs while getting and staying compliant up to 90% quicker?
You may already have a good guess about what we’re about to say.
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