SOC 2 reports evaluate internal controls to see how well a company identifies, assesses, mitigates, and monitors risks. In the context of third party risk management (TPRM), a SOC 2 can give you confidence that your critical vendors are following best practices to protect your data.
If you’re getting started with SOC 2 for third party risk management or need an update, this blog has got you covered.
A SOC 2 report (short for Service Organization Control) is a standard to provide assurance that an organizations’ systems are set up to cover five core subject areas:
The purpose of this audit is for an organization to detail the operational effectiveness of their systems, based on the Trust Service Criteria.
In order to comply, organizations must develop and document clear security policies, procedures, and supporting evidence.
Unlike a SOC 1, which focuses on financials, a SOC 2 is all about compliance. There are two types of reports:
SOC 2 Type 2 reports are generally preferred in third party risk assessments because they cover a longer period of time.
SOC 2 type 2 audits are essential in regulatory oversight, vendor management programs, internal governance, and risk management.
They are used for auditing service organizations (or third party vendors) such as cloud service providers, software providers and developers, and financial services organizations. They cover nearly everything you need to know about how a vendor protects your data—from security and privacy to business continuity and internal procedures.
They also show how exceptions are —or aren’t— corrected to determine vendor reliability. This is why they are a key component of vendor due diligence and third party risk assessments.
The controls assessed include:
Some vendors share SOC 2 reports of their data centers, but ideally you need one that covers their own business operation, end-to-end. If a critical or high-risk vendor does not have a SOC report, it’s still necessary to engage in due diligence to address their inherent risk and ensure your data is protected.
As a leader in third party risk and vendor management, ThirdPartyTrust recognizes the burden that risk assessments and due diligence work puts on organizations.
With our TPRM automation tool, you can address SOC 2 third party risk management requirements by:
The ThirdPartyTrust third party risk management platform provides a central repository for vendor management, with capabilities such as rule-based access management, and tiering logic for prioritizing vendor risk assessments.
It can help you automate the end-to-end vendor risk assessment process, including setting risk and impact scoring based on risk acceptance and tolerance levels.
The ThirdPartyTrust risk management tool is backed by a stellar Customer Success team and managed services that can help you set up, optimize, or even handle the risk management process for you. SOC 2 compliance doesn’t have to be painful.
Watch us explain how to simplify risk assessments and due diligence with ThirdPartyTrust:
Let us show you how to make TPRM easier. Talk to an expert today.
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