Software as a Service (SaaS) solutions are essential to modern organizations. However, each new SaaS product integrated into your technology stack can introduce vulnerabilities that may lead to data breaches or compliance issues.
So, how do you continue leveraging mission-critical SaaS tools while ensuring compliance with regulatory frameworks? This article breaks down the essentials of SaaS compliance, helping you safeguard your business and data.
What Is SaaS Compliance?
SaaS compliance refers to the process of adhering to legal and regulatory requirements around privacy and data security. These regulations are designed to protect the sensitive data your business handles and ensure that customers’ information is treated with care.
SaaS compliance is crucial because it establishes trust between your business and its clients. Customers are more likely to entrust you with their data if they know you prioritize compliance. In addition, compliance directly impacts SaaS security, helping prevent security risks and data breaches.
Key Compliance Regulations Impacting SaaS Data
Improving SaaS compliance starts with understanding key data protection laws and regulations. These compliance programs fall into two broad categories: regulatory and security compliance.
Regulatory Compliance
Several frameworks govern SaaS compliance. Some are established by federal law, while others are created by industry leaders. Key regulatory compliance frameworks that may apply to your business are listed below. Note that this does not a
SOX
The Sarbanes-Oxley Act (SOX) was implemented to protect shareholders and the public from accounting errors and fraudulent practices in corporations. For SaaS companies, this means ensuring the integrity of financial data and maintaining proper reporting protocols.
If your business is publicly traded, it is also responsible for implementing financial compliance measures by SOX. Failure to comply with SOX can lead to severe penalties, including fines and even jail time for executives. Make sure you understand your company’s obligations under SOX, especially when managing financial data in your SaaS platforms.
23 NYCRR 500
The New York Department of Financial Services (NYDFS) Cybersecurity Regulation, known as 23 NYCRR 500, mandates that financial institutions implement comprehensive cybersecurity programs to protect sensitive customer information. This regulation applies to banks, insurance companies, and other financial institutions operating in New York. Key requirements include establishing a written cybersecurity policy, designating a Chief Information Security Officer (CISO), conducting regular risk assessments, and implementing robust data protection protocols.
Organizations must also ensure incident response and notification plans are in place, with breaches reported within 72 hours. Non-compliance with 23 NYCRR 500 can result in significant financial penalties and reputational damage, emphasizing the importance of a proactive cybersecurity strategy for SaaS providers working with New York-based financial entities.
SEC-17 4a
SEC-17 4a is a regulation from the U.S. Securities and Exchange Commission (SEC) that mandates the retention and preservation of certain electronic records. Your organization must configure your SaaS platforms to support adequate record retention practices.
SEC-17 4a requires that all relevant data, such as emails, documents, and transition records, be retained in a tamper-proof format for six years. Failure to comply with SEC-17 4a can result in fines or sanctions.
Learn about SEC-17 4a requirements and how Own can help support your compliance efforts.
PCI DSS
The Payment Card Industry Data Security Standard is a set of regulations designed to protect credit card information. SaaS providers that process, store, or transmit payment card data must comply with PCI DSS to safeguard against data breaches and fraud. This standard requires you to implement multiple layers of security, including encryption, to achieve SaaS compliance.
Non-compliance can lead to severe penalties. For instance, you could be fined, and you risk losing your ability to process credit card payments. As such, your business must make this type of SaaS compliance a top priority.
General Data Protection Regulation (GDPR)
The General Data Protection Regulation (GDPR) is a European Union (EU) law that governs the collection, processing, and storage of personal data from EU citizens. If your business deals with any information from EU citizens, it must integrate GDPR into its data processing policies.
The GDPR carries some of the stiffest penalties of any SaaS compliance framework. The law also includes strict reporting protocols and applies to any company that deals with the data of EU citizens, even if the organization is located outside of the European Union.
Learn about GDPR requirements for backups and how Own can help support your GDPR compliance efforts.
Digital Operational Resilience Act (DORA)
Another European Union law, the Digital Operational Resilience Act (DORA), seeks to improve the cybersecurity resilience of financial services across the EU by setting standards for risk management, incident reporting, and third-party management. DORA applies to a wide array of financial organizations, including SaaS providers working with financial entities within the EU. It emphasizes continuous monitoring of information security risks, along with regular testing of cybersecurity measures to safeguard sensitive financial data.
Additionally, DORA mandates clear incident reporting protocols, aiming to improve transparency and enhance operational resilience against digital threats across the EU’s financial sector. Non-compliance can lead to significant fines, as DORA intends to establish a unified cybersecurity framework across Europe, promoting a more resilient financial ecosystem.
Learn about DORA requirements for backups and how Own can help support your DORA compliance efforts.
California Consumer Privacy Act (CCPA)
The California Consumer Privacy Act became law on the heels of the GDPR. California lawmakers borrowed concepts from the GDPR while also addressing privacy concerns unique to the state’s consumers.
The CCPA applies to any organization that collects and stores data from California residents. Individuals have the right to know what information they are gathering and can even request that their data be deleted.
As part of your SaaS compliance efforts, you must ensure that consumer data is organized and readily accessible. That way, you can delete records or provide an account of the consumer information you’ve gathered.
Health Insurance Portability and Accountability Act (HIPAA)
The Health Insurance Portability and Accountability Act provides a framework for guarding sensitive patient data in the U.S. HIPAA applies to electronic health records (EHRs) and personal health information (PHI).
If personal healthcare information is a part of your workflow, you need to implement security controls to keep that data out of the wrong hands. HIPAA compliance requires encryption of PHI, both when in transit and at rest. You must also implement role-based access control to prevent unauthorized access.
Learn about HIPAA compliance and how Own can help support your HIPAA compliance efforts.
Security Compliance
The second facet of SaaS compliance focuses on data security. You need to create and strictly enforce security practices that mitigate the risk of a breach of your SaaS environment. Here’s a look at two main security compliance frameworks that apply to SaaS solutions, both of which we have obtained at Own: SOC 2 and ISO 27001 certification.
Service Organization Control 2 (SOC 2)
SOC 2 is a widely recognized security certification in the SaaS industry. It ensures that developers and users of SaaS applications are managing customer data securely based on five key principles:
- Security
- Availability
- Processing integrity
- Confidentiality
- Privacy
Your business should strive for SOC 2 compliance. Integrating Service Organization Control 2 standards into your SaaS compliance strategy can give stakeholders and consumers peace of mind. Compliance with the framework demonstrates that your organization is committed to proactive risk management.
ISO 27001 Certification
ISO 27001 is an internationally recognized standard for information security management systems (ISMS). It outlines best practices for managing information security risks and protecting sensitive data from breaches. SaaS providers and user organizations that achieve ISO 27001 certification demonstrate their ability to systematically assess security risks and implement appropriate controls.
The certification process involves developing an ISMS that covers all aspects of data security. Your ISMS must address critical issues like encryption, access control, and auditing. The certification can help you achieve and maintain SaaS compliance while also building trust with customers.
Common Compliance Challenges for SaaS Data
Achieving and maintaining compliance is no small feat. Here are some hurdles you’re likely to encounter along the way:
Data Security and Encryption
Data security represents one of the biggest hurdles you’ll face. You must ensure that sensitive data is stored and then transferred securely to meet all relevant corporate requirements.
Encryption plays a vital role in this process as well. You’ll need to encrypt data while in transit and while at rest to mitigate risks of information theft. However, implementing and managing encryption protocols can be complex, which we can help with when it comes to Salesforce.
Access Control and Authentication
One of the core elements of SaaS compliance involves controlling who has access to sensitive information. Role-based access control ensures that only authorized users have a way of getting to certain data. The idea is to give your employees the minimum amount of access necessary to fulfill their core job responsibilities, a concept known as the Principle of Least Privilege (PoLP). Users should not have free rein over your apps or database.
Implementing access control is only half the battle, though. You’ll also need to monitor and log user access. Setting up a comprehensive monitoring solution can be a labor-intensive and tedious process. Creating customized permission sets and roles can also be time-consuming. However, you shouldn’t cut any corners when implementing access control measures.
Keeping Up With Changing Regulations
Compliance laws are not static, they evolve and vary by jurisdiction. For example, several states have been revising existing compliance regulations or working to create new, more comprehensive frameworks as part of a global focus on protecting consumer privacy.
You need a compliance team that’s dedicated to keeping up with the latest changes in regulations and ensuring that your platform strengthens your security posture.
Demonstrating Compliance
Even if you have all the right security measures in place, demonstrating compliance can be time-consuming. Many companies face challenges when it comes to responding to audit requests and providing reports. Automating tasks such as data classification and reporting can help you reduce the time and effort required for your audit.
Responding to information requests quickly has become especially important in the post-GDPR era. If a consumer wants to know what data you have collected about them, you must respond to their request in a reasonable and timely manner.
The specific window that you have to reply to requests will vary depending on which framework the request falls under. However, failing to provide records or delete personal data within set thresholds can lead to hefty fines.
Best Practices for Achieving and Maintaining SaaS Compliance
SaaS compliance can’t be treated like an afterthought. You must make it a foundational part of your company culture. Educate your team on the importance of achieving and maintaining a high level of compliance by taking these steps:
Conduct Regular Compliance Audits
Audits keep you and your team honest. These introspections into your policies and procedures help determine whether your staff are following established best practices as they go about day-to-day tasks.
While some audits can be performed internally, you should periodically bring in an objective third party to oversee your audit. The entity can provide a fresh perspective on what you are doing well and how you can get better.
Taking a proactive approach to audits will ensure that your team stays ready to respond to formal requests put forth by regulatory bodies. You don’t want your very first audit to have severe implications like a hefty fine or a public scandal. Self-audits provide an opportunity to work out the bugs and improve your policies.
Implement Data Protection Measures
Data protection should be a top priority for any business. After all, you handle a great deal of sensitive information. You probably couldn’t make it a single day without all of your critical data.
Use a variety of complementary protection measures to give yourself peace of mind in the face of cyber threats. Encrypt information while it’s in transit and at rest to keep it out of the wrong hands. Implement a backup and recovery strategy to ensure you are ready for any threat that comes your way.
Create a Compliance-Focused Culture
Compliance isn’t just the responsibility of the IT or legal departments. Everyone plays a role in creating a strong compliance posture. Make sure that every member of the organization receives training on data privacy and compliance requirements so they can promote business continuity.
Check that they understand how their actions (or inaction) can impact the company and its valued customers. By fostering a complaint-focused culture, you can minimize the risk of breaches and maintain consumer trust.
Automate Compliance Processes
Compliance is a huge undertaking and you can’t afford to cut corners. However, it’s also true that you’ve already got enough responsibilities on your plate. How, then, do you bridge the gap between the need for SaaS compliance and the realistic limitations of labor and time resources?
The key lies in automation. Tools that can handle audit logging and data tracking will save your team countless hours every month. Compliance reporting tools also play a key role in saving you time while mitigating the risk of oversights or human errors. Automation both streamlines processes and helps maintain accurate and up-to-date records.
How Own Helps With SaaS Data Compliance
Managing SaaS compliance can be overwhelming, but partners like Own can help ease your burden. We can help you:
- Demonstrate that data practices comply with regulatory requirements and internal policies
- Ensure data is secure from unauthorized access and breaches
- Ensure data is properly backed up, retained, and managed throughout its lifecycle
- Enable investigation into historical data and changes made to it
Explore our compliance solutions today.
