You’ve heard about the importance of ISO 27001 certification and its globally-recognized standards for managing information security. But what exactly does the process entail? And what does being ISO 27001 compliant really mean? Many SaaS startups know they need to undergo an ISO 27001 audit but lack the knowledge and expertise to start the process.
Getting ISO 27001 certified is no small undertaking. If you’re not sure how to set up an information security management system or if you’re feeling overwhelmed, you’re not alone.
ISO 27001 is the leading international data security standard, trusted by companies around the world. In Europe, the protocol is generally recognized as the gold standard in information security.
ISO 27001 is a rigorous and comprehensive information security protocol that covers an organization’s overall information security protocols, including information security management systems, information security technology, and information security requirements.
Obtaining an ISO 27001 certification demonstrates that a company complies with the highest internationally-recognized information security standards.
This certification demonstrates world-class operational security in threat monitoring, security breach mitigation, and sensitive data protection. With this exemplary reputation for risk management, partners and customers of ISO 27001 accredited organizations are very confident in the security of their information assets.
However, implementing ISO 27001 is more than a highly effective way to enhance an organization’s information security process. Becoming ISO 27001 certified is evidence of world-class security protocols and therefore offers a key competitive advantage in any sector where robust security is a highly prized asset. Indeed, SaaS companies without evidence of a robust data security protocol may struggle to attract customers and fail to meet clients’ demanding procurement requirements.
ISO 27001 certification requires an investment of time and resources. However, with the right technology and insight, the process has the potential to be much simpler, faster and more efficient. When implemented effectively, the rewards of ISO 27001 are immense for many organizations.
We have created this guide to help you manage the demanding ISO 27001 certification process from start to finish, reducing the time and resources normally required to do so, as well as having a clear understanding of everything you need to know about ISO 27001 certification.
ISO 27001 certification is an internationally recognized compliance standard aimed at protecting critical information assets, mostly customer data. ISO 27001 stipulates specific requirements for the establishment, maintenance, and continuous improvement of an organization’s information security management systems (ISMS).
The ISMS is a broad framework consisting of policies and procedures designed to ensure the company effectively identifies risks and establishes and implements controls to effectively manage those risks. Ideally, the ISMS also sets a benchmark for continuous assessment and improvement. Following ISO 27001 best practice, and seeking certification, is an effective way to both develop a robust ISMS and demonstrate the effectiveness of your controls.
As many companies require evidence of effective information security, becoming ISO 27001 certified is an efficient way to meet exacting procurement requirements. To become certified, a business undergoes a rigorous audit by an independent third-party auditor. The auditor carefully evaluates the company’s policies and controls. If the audit is successful, the company receives ISO 27001 certification, which demonstrates that the ISMS meets the protocol’s high standards.
Nonconformities are a possible outcome of the certification audit, which means you do not fully meet the requirements of the standard, such as missing records or documentation. The more nonconformities, the less compliant you are. If the auditor observes a major nonconformity, a company cannot get certified. However, when this happens, the auditor will state the major non-conformity in the audit report and give you a deadline to resolve the causeof the non-conformity (usually 90 days). Once the auditor observes this evidence, if you have addressed the nonconformity thoroughly, most of the time the auditor will accept your corrective action and proceed to issuing the certificate.
While ISO 27001 certification is globally recognized, it is particularly valued in European markets. Any business looking to develop a European presence will gain a strong competitive advantage by becoming ISO 27001 compliant. The standard also helps SaaS companies, and any tech business that manages user data, meet demanding information security procurement protocols, in Europe and beyond.
But why, exactly, do you need a robust ISMS? Don’t most tech businesses already have advanced data security tools in place? Believe it or not, IT isn’t the key element in protecting information anymore. In the majority of cases, the companies already have a lot of relevant technology in place – for example, antiviruses, multi-factor authentication, and backups. However, in any organization, suitable technology is necessary but not sufficient. If the actual information security systems are not organized effectively and deployed properly, then there are likely to be data security weak points. In addition, without effective, ongoing monitoring, security risks are being compromised at any point in time, and not getting the right attention on time.
And this is what ISO 27001 compliance is about: it provides a framework for companies to find out the potential incidents that could happen to them (i.e., risks), and then develop robust procedures to manage those risks appropriately.
From this point of view, ISO 27001 has obvious value for any organization that seeks to (or has a mandate to) formalize and improve business processes around information security, privacy, and securing its information assets.
In the modern information economy, many businesses, in various sectors, manage large amounts of sensitive data, across various networks.
Let’s take a look at just some of the industries that are typically implementing this standard:
Tech companies
For cloud computing providers, Software as a Service, and IT support businesses, implementing ISO 27001 is good for business. Those companies can attract clients by demonstrating that they can safeguard their information in the best way possible. Many tech businesses also rely on ISO 27001 to guarantee compliance with contractual security regulations from their main clients. ISO 27001 is also an excellent way for startups and fast-growing companies to resolve problems in their procedures, as the standard forces companies to define responsibility and implement the steps that need to be taken in the most important operations.
Financial industry
Insurance companies, payment companies, brokerage houses, banks, and other financial institutions frequently take advantage of ISO 27001 certification in order to comply with the high levels of information security required in the financial sector. ISO 27001 is the proven, generally accepted methodology for achieving compliance in these industries. Financial services are also strongly motivated by the costs associated with poor risk management. Preventing incidents before they occur is significantly less costly than suffering a serious breach.
Telecoms
Internet providers and telecommunication companies are also very keen on protecting the huge amounts of data that they handle and also reducing the number of outages. ISO 27001 is an invaluable framework for achieving those goals. Furthermore, as with financial institutions, ISO 27001 helps telecom companies meet the ever-evolving set of laws and regulations governing the industry.
Government agencies
Government agencies typically handle extremely sensitive data. ISO 27001 is specifically designed to meet the exacting data security demands of organizations, making it an ideal methodology to manage information security risk.
A powerful standard for any sector
In fact, ISO 27001 compliance is not limited to any particular set of industries. It is a powerful standard that helps many organizations in various industries meet their most exacting information security requirements. Any company that stores sensitive customer information will benefit from implementing ISO 27001. For instance, healthcare providers rely on the framework to protect sensitive patient information and comply with strict confidentiality laws. Cybersecurity firms are able to assure clients of secure, reliable service. Indeed any businesses that manage confidential information, such as HR data and personnel files, will benefit from the enhanced security ISO 27001 provides.
Information security and compliance are not just a priority for information security and compliance teams. Being a certified ISO 27001 supplier means major benefits for an organization.
ISO 27001 compliance is internationally recognized and respected. Becoming certified confers a significant competitive advantage, especially when entering new markets. Customers want reassurance that their providers will effectively safeguard their data, and ISO 27001 certifications signal precisely that.
Many businesses have strict in-house security standards and will only do business with companies that offer sufficient reassurance of security and data integrity. Becoming ISO 27001 compliant is one of the most effective ways of meeting these requirements.
Prevention is better than cure, especially when it comes to data security. Becoming ISO 27001 compliant is one of the best ways of developing effective risk management systems that effectively prevent breaches and data leaks. Considering the lasting reputational damage caused by data security incidents, many businesses value ISO 27001 as a rigorous and effective risk-management system.
Most users will demand a high level of trust in your platform before they permit you to process their personal data. ISO 27001 certification demonstrates to users that you follow best data security practices and will safeguard their confidentiality.
Downtime means missed opportunities to supply your services. Frequent downtime also risks annoying your customers. As part of ISO 27001 ISMS, companies implement an effective business continuity (BC) and disaster recovery (DR) plan. These plans will help you continue to provide continuous service, even in the event of a crisis, and minimize downtime experienced by customers.
Data security is compromised if there are any weak links. If data is shared with third parties, you need a mechanism to ensure the entire chain of transmission is secure. ISO 27001 compliance involves comprehensive data protection policies that account for your data systems as a whole, including any third party vendors.
Security is as strong as the weakest link. ISO 27001 compliance helps reduce human error in two important ways. First, implementing controls around all checkpoints in an employee lifecycle: recruitment, onboarding, transition between roles and offboarding. Moreover, ongoing security awareness training and improved internal processes helps employees follow best security practices and stay up-to-date with the latest security protocols, ensuring a security-aware culture. In addition, having effective and reliable security systems and consistent risk monitoring in place prevents more human risks too.
Second, if you are using purpose-made compliance technology to manage your ISO 27001 compliance, it helps automate and simplify many complex human processes.
Implementing an ISO 27001-compliant Information Security Management System (ISMS) can be challenging but extremely rewarding. After all, building watertight information security systems across an entire organization takes an investment of time and resources, especially for startups and first-timers.
If you’re just starting out with the standard, we’ve put together this helpful ISO 27001 implementation roadmap to help you get it right the first time.
Considering the scope and complexity of implementing ISO 27001, it’s critical to have a dedicated manager driving the entire process. This shouldn’t be an afterthought: effective leadership is critical to the success of your compliance initiative.
The project manager needs sufficient authority and resources to implement all reasonable compliance interventions.
That said, ISO 27001 is not simply a top-down process. For startups, in particular, implementation will potentially affect everyone in the business. There needs to be clear lines of communication and precisely define roles and responsibilities from the outset.
At its best, ISO 27001 compliance isn’t a one-size-fits-all process. Startups and all dynamic businesses can implement a rigorous and independently-recognized security standard in a way that fits their specific operations and needs.
Of course, that means that, to get the most out of the process, the business needs to make a number of critical decisions at each stage in the process.
Once you’ve established the how, it’s time to clarify the what. That is, what people, systems, applications and processes will be covered by your ISMS. This is defined in your scope statement.
After all, the ISMS is the system of controls that safeguards data and ensures consistency and reliability. But each business has different security needs and operational requirements. Not every ISMS will look the same.
Defining the scope of your ISMS is therefore an important strategic decision. Your ISMS needs to be broad enough to cover all critical data security risks. At the same time, most startups can’t afford to waste time and resources on inessential or irrelevant processes. Finding the right balance is a critical step in developing an effective and efficient ISMS.
It is important to understand that ISO 27001 certification is for an organization (and its subsidiaries) and not for a product, and so a company needs to choose which part of the organization needs to be in scope.
Once the organization is clear on the scope of the ISMS, you need to establish your security policies. These are high-level policy documents detailing your security objectives. Remember, ISO 27001 is not a cookie-cutter standard. The security policies are unique to your company, devised in context of your changing business and security needs. Your policies will ultimately shape the way information security is implemented throughout the business.
Some required policies for ISO 27001 are the following:
In order to perform a precise, verifiable risk assessment of the company’s data security, you need to establish a method for scoring risks. ISO 27001 doesn’t specify any one method for scoring risks. The company has the flexibility to choose a method that suits its needs. You need to ensure, however, that the methodology is appropriate to your ISMS policy objectives and that all relevant personnel are fully briefed on the selected procedure.
Once you’ve defined your assessment methodology, it’s time to identify and evaluate any information security weaknesses in the organization.
This is a sophisticated multi-stage process that goes beyond simply identifying potential threats.
Once you have identified security gaps you should i) assess their impact and ii) devise a risk treatment.
Assessing risk impact
Not all risks are equally serious. You should assess the potential consequences of each risk and prioritize the risks accordingly.
Implement a risk treatment
Following the impact assessment, you need to decide how you will address each risk. High-priority risks obviously demand the most urgent and far-reaching attention.
In terms of ISO 27001 risk treatment procedures, the organization has four broad options in response to a given risk:
A Statement of Applicability is a requirement for your ISO 27001 audit. It outlines which Annex A controls are applicable to your organization and therefore, included in your scope.
A Statement of Applicability should:
To understand the details of Annex A controls and how they could be implemented, you need to consult ISO 27002, which serves as a guidance document of the ISO 27001 security controls.
ISO 27002 was officially updated on February 15, 2022, and updates in ISO 27001 Annex A will take place during the course of 2022. The 2022 updates apply to the security controls of ISO 27002 and therefore, Annex A of ISO 27001
The previous version of Annex A contained 114 controls across 14 families, while the new version contains 93 controls across 4 families:
The decrease in the number of controls is due to many controls being merged.
Turning your risk management blueprint into reality is about more than simply following a plan. The whole organization needs to effectively adapt to the new ways of working. For startups, this may seem like a drastic culture shift at first but will set a foundation for information security excellence as the business grows.
ISO 27001 isn’t meant to simply work on paper. It’s a practical toolkit for delivering robust real-world data security. Ongoing monitoring and reviewing of all policies, procedures and security controls are essential to help ensure your ISMS is functioning properly and delivering the results you require and your customers demand.
One reason ISO 27001 is such a respected global standard is that your compliance is carefully audited by an independent third party. To become certified, you must appoint a respected and accredited auditor, which will issue certification following a successful audit.
As we can see from the steps above, a successful audit depends on careful preparation and expert guidance.
In the first phase of the independent assessment, the auditor reviews the design of your ISMS to determine whether they are fit for the purpose for which they are designed.
After reviewing the design, the auditor issues an interim audit report. This report specifies whether there are any major or minor shortcomings in the design of the ISMS and proposes ways to address these issues.
The preliminary audit report can therefore provide an important opportunity for the company to improve its security posture and practices and enhance implementation before the official audit.
In the second phase of the review, the auditor assesses the actual operating effectiveness of your ISMS, possibly through the company Statement of Applicability (SOA). The auditor determines both that the controls have been implemented correctly and that they are operating effectively.
The independent auditor will carefully review your controls and policies and procedures against the criteria of ISO 27001 compliance.
If your information security standards meet this criteria, this should be the final step before certification. However, the audit process does not stop there. Ongoing reviews, in the form of surveillance audits, are the norm in ISO 27001 certification.
The International Organization for Standardization survey shows that in 2020 44,486 valid ISO 27001 certificates were issued at 84,166 sites. That’s even more impressive when we consider how exacting and rigorous ISO 27001 compliance is.
However, it is no surprise that more companies are taking measures to enhance their data security. Information security is not simply a theoretical concern. It’s a critical business risk issue. The IBM Cost of a Data Breach Report for 2021 reveals that the average cost of a data breach is an eye-watering $4.24 million. The highest cost in the history of the report.
Of course, those are not the only reasons to adopt ISO 27001. Market pressure also plays a critical role. As one researcher points out, most companies adopt an information security framework to meet clients’ demand. That is, many clients prefer, or even require, suppliers to implement a standard such as ISO 27001.
In Europe, the standard is especially prized for helping to meet regulatory requirements and to meet customers’ procurement standards.
While total financial losses may be larger for big corporations, smaller businesses, in particular, may struggle to recover from the lasting reputational damage of a serious breach.
However, as a UK government report indicates, large organizations tend to have enhanced cybersecurity capabilities. Smaller businesses and startups do not always have adequate protection in place.
Fortunately, as the IBM report makes clear, automation is transforming compliance. In fact, the report says that automation and AI “provide the biggest cost mitigation” against breaches.
The benefits of ISO 27001 compliance and certification are clear. Certified businesses can be confident that they comply with the highest standard of information security and enjoy a competitive advantage in global markets. And customers gain the reassurance and trust that they are partnering with a company that cares about information security.
Best of all, ISO 27001 compliance is now in reach of more businesses, including ambitious startups who want to lay a solid information security foundation. With compliance automation, expert advice, and an effective strategy, any company can take advantage of ISO 27001 compliance. For startups, compliance automation is a particularly useful way to ensure the highest standards of information security, as efficiently and time-effective as possible, making the process 90% faster and the total cost of compliance half the price.
