About SOC 2 compliance in 2025

SOC 2 (Service Organization Control 2) is a security framework developed by the American Institute of Certified Public Accountants (AICPA) that helps organizations demonstrate their commitment to protecting customer data through rigorous security controls and practices. Unlike traditional compliance standards that follow a checklist approach, SOC 2 focuses on how well your organization’s controls operate over time to safeguard sensitive information.

This framework has become increasingly critical as businesses rely more heavily on cloud services, third-party vendors, and digital infrastructure. SOC 2 compliance serves as a trust signal to customers, partners, and stakeholders that your organization takes data security seriously and has implemented appropriate safeguards. The standard primarily applies to service organizations that handle, store, or process customer data, including software as a service (SaaS) companies, cloud service providers, data centers, and managed service providers.

What it is

SOC 2 originated from the AICPA as part of their Service Organization Control reporting framework, building upon the foundation of earlier SOC 1 reports that focused primarily on financial controls. The AICPA developed SOC 2 specifically to address the growing need for standardized security and availability reporting in an increasingly digital business environment.

The primary purpose of SOC 2 is to provide a standardized way for service organizations to report on their controls related to security, availability, processing integrity, confidentiality, and privacy of customer data. Rather than being a pass/fail certification, SOC 2 is an attestation that provides detailed information about how your organization’s controls operate, allowing stakeholders to make informed decisions about risk.

Core requirements or principles

SOC 2 is built around five Trust Service Criteria, though not all organizations need to address every criterion:

Security (Common Criteria) – Required for all SOC 2 audits, this covers the foundation of information security including access controls, system boundaries, and risk management processes.

Availability – Ensures systems and services are available for operation and use as committed or agreed upon, addressing uptime, monitoring, and incident response.

Processing integrity – Focuses on whether systems process data completely, accurately, and in a timely manner, covering data validation, error handling, and processing controls.

Confidentiality – Addresses the protection of confidential information through encryption, access controls, and information handling procedures.

Privacy – Covers the collection, use, retention, disclosure, and disposal of personal information in conformity with your organization’s privacy notice.

Each criterion contains multiple control objectives that you must address through documented policies, procedures, and operational controls.

Types or categories

The most significant distinction within SOC 2 lies between Type I and Type II reports:

SOC 2 Type I evaluates the design and implementation of controls at a specific point in time. This report provides a snapshot assessment, confirming that controls exist and are properly designed but doesn’t test their operational effectiveness over time.

SOC 2 Type II examines the operational effectiveness of controls over a specified period, typically 3-12 months. This more comprehensive report tests whether controls are operating effectively throughout the examination period and is generally preferred by customers and stakeholders.

You can also choose different combinations of Trust Service Criteria based on your business model and customer requirements, creating customized scopes for your SOC 2 audits.

Compliance process

Achieving SOC 2 compliance involves several key phases that typically span 6-12 months:

Planning and scoping begins with defining which systems, processes, and Trust Service Criteria will be included in the audit. You must also select a qualified CPA firm to conduct the examination.

Gap assessment and readiness involves evaluating current controls against SOC 2 requirements, identifying gaps, and developing implementation plans. This phase often includes engaging consultants or using compliance platforms to streamline the process.

Control implementation requires you to design, document, and implement necessary policies, procedures, and technical controls. This may involve deploying new security tools, updating processes, and training staff.

Evidence collection occurs throughout the examination period for Type II audits, where you must demonstrate consistent operation of controls through logs, documentation, and testing results.

Formal audit involves the independent auditor reviewing documentation, testing controls, interviewing staff, and validating evidence to form their opinion on the effectiveness of controls.

Key roles typically include a compliance manager or project lead, representatives from IT, security, legal, and HR teams, and executive sponsorship to ensure adequate resources and organizational commitment.

Common challenges

Organizations frequently encounter several obstacles during SOC 2 implementation:

Resource constraints often emerge as companies underestimate the time and personnel required for compliance preparation. The process demands significant involvement from multiple departments, potentially impacting day-to-day operations.

Documentation gaps present major challenges, as many organizations lack formal policies and procedures required by SOC 2. Creating comprehensive documentation from scratch can be time-consuming and complex.

Technical control implementation may require significant infrastructure changes, new tool implementations, or custom development work to meet audit requirements, particularly around access controls and monitoring.

Evidence collection and management proves difficult for many organizations, as they must consistently gather, organize, and maintain evidence of control operation throughout the audit period.

These challenges typically occur because organizations begin the process without fully understanding the scope and complexity involved, or attempt to pursue SOC 2 without adequate planning and resource allocation.

Benefits of compliance

SOC 2 compliance delivers substantial advantages across multiple dimensions:

Business benefits include improved sales opportunities, as many enterprise customers require SOC 2 reports before engaging with vendors. You often see shortened sales cycles and the ability to access larger market opportunities that were previously unavailable.

Operational improvements result from implementing standardized security controls and processes. Many organizations discover operational inefficiencies during the compliance process and emerge with more robust, scalable operations.

Customer trust increases significantly, as SOC 2 reports provide tangible evidence of your organization’s commitment to data protection. This transparency helps build stronger customer relationships and reduces security-related objections during sales processes.

Risk reduction occurs through improved security posture, better incident response capabilities, and more structured approach to managing vendor and employee access to sensitive data.

Who needs it and when

SOC 2 compliance is particularly relevant for technology companies that handle customer data, including SaaS providers, cloud infrastructure companies, payment processors, and managed service providers. While not legally mandated, SOC 2 has become a de facto requirement in many industries where data security is paramount.

Organizations typically pursue SOC 2 when they begin selling to enterprise customers, expand into regulated industries like healthcare or financial services, or face direct customer requirements for compliance documentation. Companies experiencing rapid growth often find SOC 2 necessary to maintain customer trust and support scalable sales processes.

The timing for initiating SOC 2 compliance should account for the 6-12 month implementation timeline, with many organizations beginning the process when they anticipate customer requirements within the following year.

Preparation tips

Successful SOC 2 preparation requires strategic planning and systematic execution:

Start early by allowing adequate time for implementation and audit preparation. Beginning the process before customer requirements become urgent provides flexibility and reduces stress on internal teams.

Engage stakeholders across your organization early in the process. SOC 2 affects multiple departments, and securing buy-in and resource commitments upfront prevents delays later in the process.

Consider compliance automation platforms that can streamline policy creation, evidence collection, and ongoing monitoring. These tools can significantly reduce the manual effort required and help maintain compliance year-round.

Invest in professional support through experienced consultants or CPA firms that specialize in SOC 2. Their expertise can accelerate the process and help you avoid common pitfalls that delay compliance.