ISO 27001 vs. SOC 2 vs. GDPR: Key Differences Explained

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Nowadays, data security compliance isn’t just a legal requirement but is essential for protecting your company and customers. With cyber threats increasing and regulators imposing heavy fines, you need a structured approach to safeguard sensitive data. In fact, HIPAA revealed that data breaches compromised the personal information of over 1.7 billion individuals in 2024. 

With compliance, you can reduce the risk of data breaches and maintain customer trust. That said, ISO 27001, SOC 2, and GDPR are three major frameworks that guide companies like yours in securing data, but they serve different purposes. This article will help you know their key differences. 

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TL;DR

• ISO 27001 focuses on internal security processes, SOC 2 validates how you protect customer data, and GDPR enforces legal privacy rights for EU citizens.
• ISO 27001 is often expected in regulated industries, SOC 2 suits U.S.-based SaaS and cloud vendors, while GDPR applies globally to anyone processing EU data.
• ISO 27001 involves 114 prescribed controls, SOC 2 requires customized documentation and audits, and GDPR focuses on legal obligations like consent and breach reporting.
• ISO 27001 and SOC 2 failures damage trust and sales, whereas GDPR violations lead to legal penalties and steep fines.
• CloudEagle.ai simplifies ongoing compliance and audit readiness. It automates access reviews, monitors user activity, flags risks, and generates reports aligned with ISO 27001, SOC 2, and GDPR.

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1. What is ISO 27001?

ISO 27001 is an internationally recognized standard for information security management. It provides a structured framework for establishing, implementing, maintaining, and continually improving an Information Security Management System.

A. What Does ISO 27001 Cover?

ISO 27001 covers various security aspects, ensuring that your company adopts a comprehensive approach to data protection. It includes risk assessment, access control, incident management, asset management, and encryption practices.

B. What Are Its Key Principles and Requirements?

ISO 27001 follows three key principles:

• Confidentiality: Ensuring that only authorized individuals can access sensitive data.
• Integrity: Protecting information from unauthorized modifications.
• Availability: Ensuring data remains accessible when needed.

To comply with ISO 27001, your company must meet several requirements, including:

• Conducting a risk assessment and identifying security vulnerabilities.
• Implementing necessary security controls and policies.
• Establishing roles and responsibilities for information security.
• Continuously monitoring and improving security measures.
• Undergoing regular internal audits and management reviews.

C. What Is the Certification Process Like?

To achieve ISO 27001 certification, your company must go through a structured process:

• Gap Analysis: Assess your current security posture against ISO 27001 standards.
• ISMS Implementation: Develop policies, conduct risk assessments, and implement necessary security controls.
• Internal Audit: Conduct an internal review to ensure compliance before the external audit.
• Stage 1 Audit: A certification body reviews your documentation and security policies.
• Stage 2 Audit: A more detailed audit evaluates the practical implementation of security controls.
• Certification Issuance: If your company meets all requirements, you receive ISO 27001 certification, valid for three years.
• Ongoing Maintenance: Regular audits and continuous improvements are required to maintain certification.

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2. What is SOC 2?

SOC 2 (System and Organization Controls 2) is a compliance framework developed by the American Institute of Certified Public Accountants (AICPA). It is designed to ensure that service providers securely manage customer data to protect privacy and confidentiality.

A. What Does SOC 2 Assess?

SOC 2 evaluates how well your company protects sensitive information when storing, processing, or transmitting data. The framework is particularly relevant for SaaS companies and any business handling third-party data.

B. What Are the Five Trust Service Criteria?

SOC 2 compliance is built around five key Trust Service Criteria:

• Security: Ensuring systems are protected against unauthorized access and threats.
• Availability: Verifying that systems and services are operational and accessible as agreed.
• Processing Integrity: Ensuring that data processing is accurate, complete, and timely.
• Confidentiality: Protecting sensitive company and customer data from unauthorized access.
• Privacy: Ensuring the proper handling, storage, and use of personally identifiable information (PII).

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3. What is GDPR?

The General Data Protection Regulation (GDPR) is a comprehensive data privacy law enacted by the European Union (EU) to protect the personal data of individuals. It applies to any company that collects, processes, or stores data of EU residents, regardless of where the company is based.

A. Purpose of GDPR

GDPR was introduced to standardize data protection laws across EU member states and enhance individuals’ privacy rights. Its primary goal is to ensure that companies process personal data lawfully, transparently, and securely.

B. What Are the Penalties for Non-Compliance?

Non-compliance with GDPR can result in severe financial penalties. There are two tiers of fines:

• Up to €10 million or 2% of annual global revenue, whichever is higher, for less severe violations.
• Up to €20 million or 4% of annual global revenue, whichever is higher, for serious violations, such as failing to obtain proper user consent or not implementing adequate security measures.

For example, in 2023, Meta Platforms Ireland Ltd was fined €1.2 billion for violating GDPR’s data transfer regulations. These strict penalties showcase the importance of compliance and the need for companies to take data protection seriously.

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4. How Do ISO 27001, SOC 2, and GDPR Compare?

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A. Framework

ISO 27001, SOC 2, and GDPR all aim to enhance data security, but they have distinct focuses and objectives.

ISO 27001

ISO 27001 is a certifiable security standard that helps you establish a structured Information Security Management System (ISMS). Its primary goal is to proactively manage risks and protect the confidentiality, integrity, and availability (CIA) of information.

SOC 2

SOC 2 is an audit-based framework designed to demonstrate trustworthiness in handling customer data. It focuses on assessing security controls through the lens of the Trust Service Criteria (security, availability, processing integrity, confidentiality, and privacy).

GDPR

GDPR is a regulatory law focused on data privacy rights. Unlike ISO 27001 and SOC 2, which concentrate on security controls, GDPR emphasizes how personal data is collected, stored, processed, and shared, ensuring compliance with privacy laws in the European Union (EU).

In short, ISO 27001 helps you implement security best practices, SOC 2 ensures you can prove your security practices to customers, and GDPR mandates legal compliance with strict data protection laws.

“Privacy is not an option, and it shouldn’t be the price we accept for just getting on the internet.” — Gary Kovacs, former CEO of Mozilla.

This distinction matters because, while all three frameworks contribute to better security, their end goals vary: ISO 27001 builds internal security policies, SOC 2 provides customer assurance, and GDPR enforces legal responsibility for protecting personal data.

B. Scope

When deciding between ISO 27001, SOC 2, and GDPR, you need to consider where they apply, which industries require them, and whether compliance is a business decision or a legal necessity.

ISO 27001

ISO 27001 applies to any industry handling sensitive data, including finance, healthcare, technology, and government. If your company wants to establish a structured ISMS, this certification helps you build trust and meet industry requirements. While ISO 27001 compliance is voluntary, many enterprise clients and regulatory bodies expect it.

SOC 2

SOC 2 is widely used in the U.S., particularly for technology and cloud-based service providers. If your company offers SaaS solutions, IT services, or manages third-party data, you may find that clients demand a SOC 2 report before doing business with you.Complying with SOC 2 compliance provides your company a competitive advantage in security-conscious markets.

GDPR

GDPR, on the other hand, is mandatory if you handle personal data belonging to EU residents, regardless of where your company is based. If your company collects, stores, or processes personal information from EU citizens, you must comply with GDPR’s privacy regulations or risk facing severe fines.

For example, in 2021, Amazon was fined €746 million ($887 million) for GDPR violations, marking the largest penalty to date. This case underscores how GDPR applies no matter where your company is located. If you process EU citizens’ data, compliance isn’t optional.

C. Requirements

When evaluating ISO 27001, SOC 2, and GDPR, you need to understand what each framework requires from your company. While they all focus on data security and privacy, their specific requirements, level of detail, and enforcement mechanisms differ. Some controls overlap, but each framework has unique compliance demands.

ISO 27001

You must implement security controls based on Annex A, which includes 114 controls (grouped into 14 categories), covering areas like access control, cryptography, and incident response. To maintain certification, your company must undergo regular audits and demonstrate ongoing improvements in security management.

SOC 2

SOC 2 focuses on the Trust Service Criteria: security, availability, processing integrity, confidentiality, and privacy. Unlike ISO 27001, it doesn’t mandate specific controls but requires you to design and document internal security processes that meet these principles. If you’re seeking SOC 2 compliance, you must pass an independent audit, which results in either a SOC 2 Type I report (one-time assessment) or a SOC 2 Type II report (evaluating controls over time).

GDPR

GDPR has strict legal requirements for how you collect, process, and store personal data. Some of the key obligations include:

• Obtaining user consent before processing data.
• Providing users with the right to access, correct, or delete their data.
• Appointing a Data Protection Officer (DPO) if your company processes large amounts of personal data.
• Reporting data breaches within 72 hours.
• Ensuring data protection by design and by default.

a. Do They Have Overlapping Controls?

Yes, there is significant overlap among these frameworks, particularly in security best practices. For example:

• Access control, encryption, and risk management are required under ISO 27001, SOC 2, and GDPR.
• Incident response plans are essential for ISO 27001 and SOC 2, and GDPR mandates breach reporting.
• Data protection policies are required under all three, but GDPR emphasizes user privacy rights more than the others.

"If you spend more on coffee than on IT security, you will be hacked. What’s more, you deserve to be hacked." — Richard Clarke, former U.S. Cybersecurity Advisor

A real-world example of overlapping controls is how Microsoft implements compliance programs for its cloud services. Microsoft holds ISO 27001 certification, undergoes SOC 2 audits, and ensures GDPR compliance for its European customers, proving that these frameworks can work together.

D. Certification

Achieving compliance with ISO 27001, SOC 2, or GDPR requires different approaches to assessment. Despite the importance, many companies underestimate the complexity of achieving compliance. According to a 2023 survey, only 54% of companies that seek ISO 27001 certification pass on their first attempt.

While some frameworks mandate independent audits, others allow for self-assessments or regulatory reviews. Understanding these differences helps you determine the level of effort and resources needed for certification.

ISO 27001

ISO 27001 requires a formal third-party audit by an accredited certification body. To become certified, your company must undergo a Stage 1 audit (reviewing documentation and policies) followed by a Stage 2 audit (evaluating the implementation of controls). Certification is valid for three years, with annual surveillance audits to ensure continued compliance.

SOC 2

SOC 2 is an attestation report, not a formal certification. Your company must hire an independent CPA firm to conduct the audit, which results in either a SOC 2 Type I report (point-in-time assessment) or a SOC 2 Type II report (monitoring controls over a period of time, typically 3–12 months). There’s no official expiration, but most companies renew SOC 2 reports annually.

GDPR

GDPR does not have a certification process like ISO 27001 or SOC 2. Instead, compliance is self-regulated, meaning your company must document and implement required controls. However, regulatory authorities (such as the European Data Protection Board) can investigate and impose fines if violations are found. Some organizations pursue third-party GDPR compliance audits to demonstrate due diligence, but these are not mandatory.

E. Consequences

Failing to comply with ISO 27001, SOC 2, or GDPR can lead to financial penalties, legal repercussions, and reputational damage. While some frameworks impose strict regulatory fines, others impact business credibility and customer trust. Understanding the consequences of non-compliance helps you assess the risks involved.

ISO 27001

Since ISO 27001 is a voluntary certification, failing to comply doesn’t result in legal fines. However, the absence of certification can hurt your credibility, especially if your company operates in a security-sensitive industry. Many enterprise clients and partners require ISO 27001 compliance before doing business with you, so non-compliance can lead to lost contracts and revenue.

SOC 2

Like ISO 27001, SOC 2 is not legally required, but non-compliance can limit business opportunities. If you fail a SOC 2 audit or don’t meet the necessary controls, your company may struggle to secure deals with clients that demand third-party security attestations. 

Additionally, failing to maintain SOC 2 compliance increases the risk of data breaches, which can lead to legal liabilities. According to a 2024 IBM Security Report, the average cost of a data breach reached $4.88 million.

GDPR

Unlike ISO 27001 and SOC 2, GDPR is a legally enforceable regulation, meaning non-compliance carries heavy financial penalties. The maximum fine for a GDPR violation is €20 million or 4% of annual global turnover, whichever is higher. Regulators have imposed record-breaking fines on companies like Amazon (€746 million), WhatsApp (€225 million), and Google (€50 million) for privacy violations.

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5. Which Compliance Framework Should Your Company Follow?

Choosing the right compliance framework depends on several factors, including your industry, geographic location, client expectations, and regulatory requirements. While ISO 27001, SOC 2, and GDPR all focus on data security and privacy, they serve different purposes and apply to different types of companies.

Choose ISO 27001 if:

• You want a globally recognized information security management system (ISMS).
• Your company operates in industries like finance, healthcare, or technology, where security certification is a competitive advantage.
• You need a structured approach to risk management and continuous security improvement.

Choose SOC 2 if:

• You provide cloud-based services or SaaS solutions and need to assure clients about your security controls.
• You primarily operate in North America, where SOC 2 is a widely accepted security standard.
• Your customers require independent third-party attestation of your internal controls.

Choose GDPR compliance if:

• You process or store the personal data of EU citizens, regardless of where your company is based.
• You want to avoid severe financial penalties, as GDPR non-compliance can lead to fines of up to €20 million or 4% of your annual global revenue.
• Your company prioritizes privacy rights, data transparency, and user consent as part of its business model.

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6. Using CloudEagle.ai to Stay Compliant

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CloudEagle.ai is a SaaS management and procurement platform designed to help you track, optimize, manage, and renew your SaaS licenses efficiently.

With CloudEagle.ai, you can detect potential risks, enforce security policies, and effortlessly generate audit-ready reports. Here’s how it can help your company stay compliant. 

Centralized Compliance Management

Non-compliance can lead to costly fines and legal complications, but CloudEagle.ai helps you stay ahead by ensuring continuous compliance. With real-time alerts, you can detect potential violations early and address them before they result in penalties.

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CloudEagle.ai provides a centralized platform to monitor user activity, track application access, and maintain detailed records. By simplifying compliance management, it reduces complexity and enhances efficiency.

With built-in support for key regulations like SOC 2, ISO 27001, and GDPR, CloudEagle.ai streamlines access control, monitoring, and auditing. This eliminates the need for multiple tools, making compliance oversight more effective and hassle-free.

Automated Compliance Reporting

Generating compliance reports manually can be time-consuming, but CloudEagle.ai automates the process, ensuring audit-ready reports are always available. This not only saves time but also reduces manual effort.

Real-time audit logs provide complete visibility into access events and application usage, allowing you to monitor activity and address any compliance concerns swiftly.

Continuous Monitoring and Risk Management

With real-time monitoring of user access and data transactions, CloudEagle.ai ensures your security controls remain effective. By continuously overseeing activity, your company can quickly detect and resolve security gaps before they escalate.

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The platform also identifies compliance gaps early, offering actionable insights to mitigate risks proactively and strengthen your security posture.

Automated Access Reviews

Regulations like SOC 2 and ISO 27001 require regular user access reviews, which can be tedious without automation. CloudEagle.ai streamlines this process by continuously tracking and validating user access, ensuring only authorized individuals can interact with sensitive data.

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By automating access reviews, the platform minimizes manual work, reduces non-compliance risks, and strengthens regulatory adherence.

Audit Trails for Seamless Compliance

Maintaining detailed audit trails is essential for SOC 2 and ISO 27001 compliance. CloudEagle.ai records all system activities, ensuring data integrity and making it easy to retrieve evidence during audits.

Additionally, the platform enforces security policies aligned with SOC 2, ISO 27001, and GDPR standards. You can customize policies to fit your company’s specific compliance needs, ensuring ongoing regulatory adherence.

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7. Conclusion

When it comes to data security and compliance, there is no one-size-fits-all solution. ISO 27001, SOC 2, and GDPR each serve different purposes, and the right choice depends on your company's industry, location, and security obligations.

CloudEagle.ai takes the stress out of compliance management. As a SOC 2 Type 2-certified platform, it helps you enforce access controls, track SaaS applications, and simplify compliance workflows. With audit logs, security monitoring, and integrated reporting, you’ll be well-prepared for your next SOC audit.

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8. Frequently Asked Questions

1. Is SOC 2 the same as ISO 27001?

No, SOC 2 and ISO 27001 are not the same. SOC 2 focuses on protecting customer data based on five trust principles, while ISO 27001 is a global standard for establishing an information security management system. When you use CloudEagle.ai, you can stay compliance with both these frameworks. 

2. Is SOC 2 a standard or framework?

SOC 2 is a framework, not a standard. It provides guidelines for managing customer data based on five trust service criteria but does not prescribe specific controls like ISO 27001, which is a formal standard.

3. What does ISO 27001 stand for?

ISO 27001 stands for International Organization for Standardization 27001.

4. What is SOC 3 compliance?

SOC 3 compliance is a public-facing report that summarizes the results of a SOC 2 audit without disclosing sensitive details.

5. Is ISO 27001 mandatory?

No, ISO 27001 is not mandatory unless required by industry regulations, contractual agreements, or internal company policies.

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