When is Confidentiality applicable in SOC 2

The Trust Services Criteria consist of five categories, each addressing a specific aspect of a service organization’s system:

1. Security: Protecting the system from unauthorized access, both physical and logical.
2. Availability: Ensuring that the system is operational and accessible for use as committed or agreed upon.
3. Processing Integrity: Ensuring that the system processes data accurately, completely, and in a timely manner.
4. Confidentiality: Protecting the confidentiality of the information processed by the system.
5. Privacy: Protecting the personal information collected, used, retained, or disclosed by the system.

The Confidentiality Trust Services category is applicable in situations where a service organization is responsible for protecting the confidentiality of the information processed, stored, or transmitted by their system. Many customers entrust service organizations with sensitive data, such as financial information, personal data, or trade secrets. The Confidentiality TSC provides assurance that the service organization has implemented the necessary controls and processes to prevent unauthorized access or disclosure of confidential information.

Confidential information is defined as any sensitive data or information that an organization has an obligation to protect from unauthorized access, disclosure, or use. The specific nature of confidential information may vary depending on the organization and the industry in which it operates.

1. Personal data or Personally Identifiable Information (PII) of customers, employees, or other individuals, such as names, addresses, social security numbers, and financial information.
2. Financial data, including transaction records, account numbers, and credit card information.
3. Intellectual property, such as trade secrets, patents, copyrighted material, and proprietary research findings.
4. Business strategies, plans, and market research data.
5. Internal communications and sensitive information related to mergers and acquisitions, partnerships, or legal matters.
6. Access credentials, encryption keys, and other security-related information that could be used to gain unauthorized access to systems or data.
7. Sensitive information related to the organization’s infrastructure, network architecture, or other critical systems.
8. Any other information designated as confidential by the organization, contractual agreements, or legal and regulatory requirements.

It is important for organizations to clearly identify and classify the types of information that they consider confidential and implement appropriate controls to protect it in accordance with the SOC 2 Confidentiality Trust Services category. This may include access controls, encryption, data masking, secure data storage, and robust policies and procedures for handling and disposing of confidential information.

1. Do your client contracts include any provisions around the safeguarding and protection of customer data?
2. Do you have confidentiality agreements or non-disclosure agreements in place between your organization and your clients?
3. Do your customers express concerns or expectations related to the protection and confidentiality of their sensitive information?
4. Does your organization process, store, or transmit sensitive data, such as financial information, personal data, intellectual property, or trade secrets?
5. Have you experienced past incidents involving unauthorized access, disclosure, or use of confidential information that have affected your customers’ operations, your organization’s reputation, or resulted in regulatory penalties?
6. Does your organization rely on third-party vendors for handling, processing, or storing confidential information, and are their confidentiality controls relevant to your organization?
7. Are there any industry-specific regulations or legal requirements governing the confidentiality of your organization’s services or the data you handle?

Answering these questions can help service organizations evaluate whether the SOC 2 Confidentiality Category is applicable to their operations and determine the appropriate controls to implement for compliance.

1. Human resources information systems (HRIS): An HRIS provider offers software solutions for managing employee data, benefits, and payroll. The Confidentiality TSC is applicable as the provider must maintain the confidentiality of sensitive employee data, including personal information, salary details, and performance records.
2. Background check services: A background check services provider processes sensitive personal information for employment or tenant screening purposes. The Confidentiality TSC is applicable as the provider must ensure the confidentiality of individuals’ data.
3. Payment processing services: A payment processing company handles credit card transactions for online retailers. The Confidentiality TSC applies because the company must ensure the confidentiality of sensitive payment information, such as credit card numbers and customer details.
4. Health information management: A healthcare organization stores and manages electronic health records (EHR) for multiple providers. The Confidentiality TSC is applicable as the organization must ensure the confidentiality of patient data, adhering to regulations like HIPAA.
5. Fleet management services: A fleet management company processes and stores sensitive vehicle and driver data for organizations. The Confidentiality TSC applies because the company must ensure the confidentiality of clients’ data, such as vehicle locations, maintenance records, and driver information.
6. Legal document storage: A legal services provider offers secure storage of sensitive documents, such as contracts, wills, and intellectual property. The Confidentiality TSC is applicable as the provider must ensure the confidentiality of these documents.
7. Cloud-based data storage: A company offers cloud-based storage solutions for sensitive client data. The Confidentiality TSC is applicable as it ensures that the company maintains the confidentiality of client data.
8. E-commerce platforms: An e-commerce platform stores and processes customer data, including personal information and payment details. The Confidentiality TSC is applicable as the platform must maintain the confidentiality of customer data.
9. Identity and access management (IAM) services: An IAM provider offers solutions for securely managing user access to systems and resources. The Confidentiality TSC applies because the provider must ensure the confidentiality of user credentials, authentication data, and access logs.
10. Online education platforms: An online education platform stores and processes sensitive student data, such as grades, test scores, and personal information. The Confidentiality TSC applies because the platform must maintain the confidentiality of student data, adhering to regulations like FERPA.
11. Research and development (R&D) companies: An R&D company handles sensitive proprietary data, such as product designs, formulas, and patents. The Confidentiality TSC applies because the company must maintain the confidentiality of clients’ intellectual property.
12. Managed security services: A managed security services provider (MSSP) monitors and manages clients’ cybersecurity infrastructure. The Confidentiality TSC category applies because the MSSP must maintain the confidentiality of clients’ sensitive security data, including incident reports, logs, and threat intelligence.

In each of these scenarios, the Confidentiality Trust Services category is applicable because the organizations involved must implement robust controls to protect sensitive information from unauthorized access, disclosure, or use. By addressing confidentiality within the SOC 2 framework, organizations can demonstrate their commitment to safeguarding sensitive data and maintaining trust with customers, employees, and other stakeholders.

The Confidentiality TSC is applicable in situations where a service organization is responsible for protecting the confidentiality of the information processed, stored, or transmitted by their system. Adhering to this category demonstrates a commitment to maintaining the confidentiality of sensitive information, which is crucial for building trust and confidence with customers, clients, and partners. By understanding when the Confidentiality TSC is applicable and ensuring compliance, organizations can foster strong business relationships based on transparency and accountability while minimizing the risk of data breaches and unauthorized disclosures.

Please reach out if you would like to learn more about how Audit Peak can assist you with your SOC 2 compliance or for a free consultation. WE WILL TAKE YOU TO THE PEAK.