Gain Competitive Edge: 6 Business Benefits of Achieving SOC 2 Compliance
Keshava Murthy
CEO
September 2023 | 6 mins
Protecting against data breaches is not just a defensive strategy. It can also help your company grow.
Passing a SOC 2 audit gives your company an edge because you can assure customers and prospects that you are taking all of the steps necessary to keep their data safe, thereby protecting from damaging breaches.
One of three types of Service Organization Control (SOC) reports created by the American Institute of Certified Public Accountants (AICPA), a SOC 2 report details the controls of the systems that your company uses to process data and describes the security and privacy of that data.
SOC 2 compliance can help businesses that handle customer data for others—such as software-as-a-service, banking, or healthcare companies—strengthen their reputations, financial statements, and stability by documenting, evaluating, and improving their internal controls.
SOC 2 keeps your brand reputation intact by helping you prevent data breaches.
All told, 55 percent of the respondents to the Cisco 2018 Annual Cybersecurity Report said they had to manage public scrutiny of a breach in the past year.
More than half of all attacks resulted in damages exceeding $500,000, including lost revenue, customers, opportunities, and out-of-pocket costs, Cisco reported.
Operations, finance, intellectual property, and brand reputation were most commonly affected.
Organizations that are concerned with security are more likely to become customers if you can provide a SOC 2 report, which shows that you are applying best practices for implementing and reporting on control systems.
Bigger companies are particularly concerned about security, especially the Trust Services Criteria that the AICPA has established for evaluating and reporting on controls over information and systems.
The 2017 Cost of Data Breach Study commissioned by the Ponemon Institute estimated the average total cost of an organizational data breach was $3.62 million.
With so much at stake, more companies are requiring that vendors at risk of data breaches prove that they are properly protected by completing a SOC 2 audit.
When pursuing clients that require a SOC 2 report, having one available will give you an advantage over competitors that don’t.
Though your competitors may claim to be secure, they cannot prove that they are without an audit.
Getting a SOC 2 report can differentiate your organization from other companies in the marketplace that have not made as significant investment of time and capital.
You can market your adherence to rigorous standards while others cannot.
You also will learn how to be more secure—and efficient—by undergoing a SOC 2.
You can streamline your processes and controls based on your understanding of the cybersecurity risks that your customers face.
This will improve your services..
SOC 2 compliance also provides industry-specific benefits like
Managed services providers can set themselves apart by demonstrating their commitment to maintaining the strong internal controls that customers want when entrusting them with the management of their information systems, including applications, databases, information security, backup and recovery, network management, and system monitoring.
Organizations like credit unions, banks, credit card companies, insurance companies, consumer finance companies, and stock brokerages face numerous challenges in internal controls.
For example, physical and logical security plays a major role in ensuring customer data is secure.
They also must maintain confidentiality and privacy, as well as the completeness, timeliness, and accuracy of transactions.
Thus, demonstrating a robust SOC 2 compliance program can be advantageous.
Efficiency-seeking companies are turning to Software as a Service (SaaS) providers to reduce costs.
SaaS providers can gain an edge by showing prospective customers that they can be trusted because they adhere to widely accepted frameworks for internal controls.
A single data center can serve many customers, housing vast amounts of sensitive data, which would make a breach exponentially damaging.
Therefore, companies scrutinize the internal controls of a data center or colocation facility before trusting them with their data. SOC 2 compliance can provide those companies with the assurance they desire.
SOC 2 compliance isn’t always required. But it is always advantageous. Give your company an edge. Want to learn more about a SOC 2 audit for your organization? Contact us for a free consultation regarding your audit needs.
Achieving SOC 2 compliance demonstrates a firm commitment to data security, showing potential and existing customers that their sensitive information is handled responsibly.
Yes, SOC 2 compliance can be a differentiator in crowded markets, highlighting a company's dedication to security and potentially opening doors to more business opportunities.
SOC 2 compliance helps identify and mitigate security risks proactively, reducing the likelihood of data breaches and the associated financial and reputational damages.
