In 2024, 60% of cloud data breaches were caused by incorrect settings, which cost firms an average of $4.9 million per time (IBM Cost of a Data Breach Report, 2024. How can businesses make sure they have strong security and consumer trust as they move to the cloud? The key to keeping data safe in the cloud is SOC 2 compliance. This blog talks about SOC 2’s role in keeping the cloud safe, its benefits, and how to make sure you’re following the rules by 2025. 

What does SOC 2 mean? 

The American Institute of CPAs (AICPA) created SOC 2 (System and Organisation Controls 2), a compliance standard that checks how well service providers keep client data safe in cloud and SaaS settings. SOC 2 differs from SOC 1 (financial reporting) and SOC 3 (public summary) since it focuses on security and privacy controls. Its focus makes it perfect for enterprises that use the cloud initially. 

There are five Trust Services Criteria (TSC) that make up SOC 2: 

1. Security: Keeps those who aren’t supposed to be able to get in (for example, with encryption and firewalls). 

2. Availability: Makes sure systems are running (for example, uptime for cloud platforms). 

3. Processing Integrity: Makes sure that data processing is correct and complete (for example, for e-commerce or financial services). 

4. Confidentiality: Protects private information such as financial reports or intellectual property. 

5. Privacy: policies ensure the responsible acquisition, storage, and disposal of personal information. 

Reports for SOC 2: 

• Type I: Looks at how well control is designed at a certain point. 

• Type II: Checks how controls work over a period of 3 to 12 months, giving you more confidence. 

What does SOC 2 mean for 2025? 

Major data breaches in Q1 2025 highlighted the need for robust cloud security. 

• United States: 16.9 million accounts 

• Russia: 4.4 million accounts 

• India: 4.2 million accounts 

• Germany: 3.9 million accounts 

In the first quarter of 2025, data breaches exposed millions of accounts worldwide, underscoring the critical importance of strong cloud security measures. According to a global data breach analysis by Surfshark, the following countries saw significant numbers of breached accounts during this period. 

Source: Link1, Link2 

Cloud Security and SOC 2 

Misconfigured S3 buckets, unprotected APIs, phishing assaults, and threats from those who work there are some of the hazards to cloud environments. SOC 2 employs robust controls to safeguard cloud infrastructure and sensitive data. 

• Identity and Access Management (IAM) uses multi-factor authentication (MFA) and role-based access control (RBAC) to prevent people from accessing cloud services without permission. 

• Encryption: It uses standards like AES-256 for Azure blobs or AWS Key Management Service (KMS) for cryptographic keys to keep data safe both while it is being sent and while it is at rest. 

• Monitoring and Logging: This department uses tools like Azure Sentinel, AWS CloudTrail, or Splunk to find problems and ensure that threats are visible in real time. 

• Shared Responsibility Model: It clarifies what each party is responsible for in the cloud. For example, AWS is responsible for keeping the physical infrastructure safe, while customers are responsible for keeping their workloads and apps safe. 

SOC 2 and Keeping Data Safe 

SOC 2 protects data, primarily through its privacy and confidentiality criteria. These controls ensure the proper handling of sensitive and personal information throughout its life cycle. 

• Data Minimisation: SOC 2 says businesses should only acquire the data they need to do their jobs, lowering the risk of exposure. For instance, a SaaS provider might only collect the most important user information, leaving out any extraneous PII. 

• Secure Data Storage: SOC 2 requires that stored data be encrypted (for example, databases should use AES-256) and that access controls be in place to prevent others from accessing it without permission. Regular audits ensure that these criteria are followed. 

• Data Disposal: SOC 2 requires safe data deletion methods, including cryptographic wiping or secure shredding, to make sure that data can’t be recovered after its retention period ends. 

• Breach Notification: The privacy criterion is in line with laws like GDPR, which require impacted parties to be notified of breaches immediately. This makes things more open and trustworthy. 

• Data Anonymisation: SOC 2 recommends anonymising or pseudonymizing data to safeguard user identities for analytics or AI-driven applications. This is a crucial step as AI use increases in 2025. 

The Capital One incident in 2019 saw the theft of 100 million customer records due to a misconfigured S3 bucket. SOC 2’s security and confidentiality requirements call for stringent access controls, encryption, and regular audits, which could have prevented this breach. A 2024 healthcare SaaS provider also avoided a data breach by using SOC 2-compliant encryption and access procedures. The measures kept patient data safe and stopped the company from breaking HIPAA rules. 

Advantages of Following SOC 2 

• Trust from Customers: A SOC 2 report shows that you care about keeping their data safe, which makes them feel better. 

• Competitive Edge: Many RFPs demand SOC 2, which gives companies that follow the rules an edge. 

• Better security: Audits find and correct holes in cloud infrastructure. 

• Regulatory Alignment: SOC 2 is in line with GDPR, HIPAA, and ISO 27001, making it easier to follow the rules. 

How to Follow SOC 2 Rules 

Scope Assessment: Based on the services your business offers and how it handles data, figure out whether the Trust Services Criteria (such as security, confidentiality, and privacy) apply. 

• Gap Analysis: Check the current controls against the SOC 2 requirements, paying special attention to data security measures such as encryption, access controls, and data disposal policies. 

• Remediation: Set up controls for all cloud resources, like MFA, AES-256 encryption, safe data erasure, and logging. 

• Pick a Cloud Provider: Choose a cloud provider that meets SOC 2 standards, such as AWS, Google Cloud, or Microsoft Azure. These providers have already been assessed and include data protection safeguards. 

• Hire an Auditor: Engage a CPA firm accredited by AICPA to conduct a Type I or Type II audit, ensuring that your data protection controls meet SOC 2 criteria. 

• Continuous Monitoring: Use Security Information and Event Management (SIEM) tools and data protection solutions to stay compliant and find problems as they happen. 

Challenges: Implementing DevOps with SOC 2 controls can be challenging. Terraform automates configurations to ensure consistency. 

Questions That Are Commonly Asked 

1. How long does it take to meet SOC 2 requirements? 

 A Type I audit usually takes 3 to 6 months, whereas a Type II audit usually takes 6 to 12 months. The time it takes depends on the company’s size, existing controls, and available resources. 

2. Is SOC 2 required? 

 SOC 2 isn’t mandated by law, but many B2B SaaS providers and cloud vendors must follow it, especially when handling sensitive customer data. 

3. What is the cost of SOC 2 compliance?  

The costs depend on the type of audit and the extent. A Type I audit might cost between $10,000 and $20,000, while a Type II audit could cost between $20,000 and $50,000, not including fixing any problems. 

4. Is it possible for small firms to get SOC 2?  

Yes, SOC 2 can grow. Small firms can use automated solutions to cut expenses and make things easier while focusing on their core TSC (such as security). 

5. How often do SOC 2 audits need to be done? 

 Type II reports usually span 12 months, and annual audits are customary to ensure current compliance. 

Conclusion 

SOC 2 is a must-have for cloud-first businesses as more people use the cloud and data protection rules get stricter. It fosters trust, enhances safety, and ensures adherence to rules. Contact us for a cloud security audit to begin your SOC 2 journey. 

More resources: 

• AICPA SOC 2 Guidelines 

• Cloud Security Best Practices