Who needs ISO 27001 certification and why?

With cyber threats on the rise, data breaches have become costly risks—the average cost reached $4.88 million in 2024. Organizations need a structured approach to mitigate security risks, comply with regulations, and protect sensitive information.

ISO 27001 is an internationally recognized security framework that evaluates an organization’s Information Security Management System (ISMS) and its effectiveness in protecting data. Achieving ISO 27001 certification demonstrates a strong information security posture to prospects, customers, partners, and stakeholders.

In this post, we’ll explore the basics of ISO 27001 certification, who needs it, and how to determine if it’s the right choice for your business.

What is ISO 27001 certification and why is it important?

ISO 27001, developed by the International Organization for Standardization (ISO) and the International Electrotechnical Commission (IEC), provides a structured framework for establishing, implementing, maintaining, and continuously improving an Information Security Management System (ISMS). It helps organizations protect sensitive data, manage security risks, and demonstrate their security posture through a formal certification process.

To achieve ISO 27001 certification, organizations must undergo an independent audit to verify compliance and assess their risk management measures. The latest version, ISO/IEC 27001:2022, consists of 10 mandatory clauses and 93 security controls, now categorized into 4 security themes:

• Organizational controls (e.g., risk management, supplier relationships)
• People controls (e.g., security awareness training, roles and responsibilities)
• Physical controls (e.g., equipment security, visitor access)
• Technological controls (e.g., encryption, access control, monitoring)

While compliance with all 10 clauses is required, organizations implement only the relevant security controls based on their unique risks and operational needs.

ISO 27001 compliance enhances security, operational efficiency, and market competitiveness. It helps organizations protect intellectual property, mitigate risks, avoid costly breaches, strengthen customer trust, and secure contracts where data security is a key requirement.

Who needs ISO 27001 certification?

ISO 27001 certification helps organizations establish a robust ISMS and demonstrate their commitment to data security. While not legally required, many businesses pursue certification to meet client expectations, regulatory requirements, and industry best practices. 

Organizations that handle, process, or store sensitive customer data benefit the most from ISO 27001, including:

• SaaS providers
• Data storage and processing platforms
• Financial institutions
• Healthcare organizations
• Telecommunications companies
• Consulting firms managing confidential client data
• Government agencies handling sensitive citizen information

Geographic considerations also influence certification decisions. In North America, SOC 2 reports are commonly recognized, whereas ISO 27001 is the globally accepted security standard. Many organizations opt for both SOC 2 and ISO 27001 to meet security expectations across different markets. These frameworks share overlapping controls, allowing businesses to streamline audits and compliance efforts.

Which industries need ISO 27001 certification?

ISO 27001 is particularly relevant for industries handling high volumes of sensitive data and requiring strong cybersecurity measures. Some of the key sectors include:

• Information Technology (IT) and SaaS: IT and cloud service providers manage vast amounts of sensitive customer data, making security and compliance crucial to prevent breaches and maintain trust.
  
• Finance: Financial institutions, including banks and fintech companies, face high risks of cyberattacks and financial fraud. ISO 27001 helps secure transactions, strengthen internal controls, and meet regulatory compliance.
  
• Healthcare: Organizations handling protected health information (PHI) must implement strict security controls. While U.S. healthcare providers follow HIPAA, ISO 27001 enables international compliance and data protection.
  
• Telecommunications: Telecom companies transmit vast amounts of data and are frequent targets of cyberattacks. ISO 27001 certification ensures secure network infrastructure and regulatory compliance.
  
• Consulting: Advisory firms manage confidential client information. ISO 27001 certification enhances data protection and security compliance.
  
• Government agencies: Government organizations handle sensitive citizen data and national security information. While ISO 27001 is not mandatory for all government entities, it helps improve security frameworks and prevent cyber threats.

Who benefits from ISO 27001 compliance?

ISO 27001 compliance benefits organizations, customers, and stakeholders by enhancing security, trust, and operational efficiency.

• Organizations: Companies gain a structured framework to protect sensitive data, mitigate security risks, comply with regulatory requirements, and improve business continuity. Certification also strengthens reputation and competitiveness, helping businesses win more clients, particularly in industries requiring stringent security controls.
  
• Customers and partners: Clients benefit from improved data protection, reduced risk of breaches, and greater confidence in an organization’s security practices. This is especially critical for industries handling highly sensitive information, such as finance, healthcare, and IT services.
  
• Regulatory bodies and auditors: Compliance ensures organizations meet legal and regulatory obligations, streamlining audits and reducing the risk of fines or penalties for non-compliance.
  
• Employees and internal teams: A certified ISMS establishes clear security policies, improves awareness, and minimizes human error, fostering a stronger cybersecurity culture.
  

ISO 27001 compliance strengthens an organization’s security posture, builds trust, and supports long-term business growth. This has become even more crucial following high-profile cybersecurity breaches, such as the 2024 Dell customer portal data breach, which exposed data from approximately 49 million customers.

How customers benefit from ISO 27001 compliance

• Assurance that their data is managed securely.
• Lower risk of breaches impacting their business operations.
• Simplified vendor onboarding and alignment with compliance requirements.

Is ISO 27001 mandatory? 

ISO 27001 is not legally mandatory in most regions, but organizations may be required to obtain certification due to contractual obligations, industry expectations, or regulatory frameworks. 

Many businesses seek ISO 27001 compliance to demonstrate a strong information security posture to customers, partners, and regulators. In sectors like finance, healthcare, and technology, ISO 27001 is often a prerequisite for doing business.

What is the importance of ISO 27001 compliance?

ISO 27001 compliance is critical for organizations handling sensitive data, as it helps establish a structured Information Security Management System (ISMS) to mitigate risks, prevent data breaches, and ensure business continuity. 

By following ISO 27001, companies can protect customer trust, meet regulatory and contractual obligations, and strengthen their cybersecurity resilience against evolving threats. Additionally, certification provides a competitive advantage, making organizations more appealing to security-conscious clients and partners.

What are the ISO 27001 certification requirements?

To achieve ISO 27001 certification, an organization must:

1. Implement an ISMS – Develop an ISMS aligned with ISO 27001 requirements.
2. Conduct a risk assessment – Identify, assess, and address security risks using a structured risk management process.
3. Apply security controls – Implement ISO 27001 security controls from Annex A, which includes 93 controls categorized into 4 themes (as per ISO 27001:2022). Organizations can select relevant controls based on their risk assessment.
4. Define policies and procedures – Establish and document security policies, access controls, incident response, and business continuity measures.
5. Train employees – Ensure staff are educated on security best practices and their roles in protecting sensitive data.
6. Undergo an external audit – Engage an accredited certification body to conduct a Stage 1 (documentation review) and Stage 2 (implementation review) audit.
7. Maintain continuous compliance – Perform regular internal audits, monitoring, and improvements to maintain certification.

These steps align with ISO’s official guidance on implementing ISO 27001:2022 for information security management​

Who can perform an ISO 27001 certification?

Only accredited certification bodies can issue an ISO 27001 certification. These certification bodies must meet the requirements outlined in ISO/IEC 17021-1 and ISO/IEC 27006, which specify the competence and reliability standards for organizations providing audits and certifications of Information Security Management Systems (ISMS). Accreditation is granted by national accreditation bodies such as ANAB (USA), UKAS (UK), DAkkS (Germany), and JAS-ANZ (Australia & New Zealand), ensuring that the certification process aligns with internationally recognized standards​

Simplify ISO 27001 compliance with Scrut

Achieving ISO 27001 certification doesn’t have to be overwhelming. With Scrut, you can streamline your ISMS, automate compliance tasks, and stay audit-ready with ease.

• Strengthen Your ISMS – Manage risk assessments, control reviews, policy attestations, and vendor risk—all in one platform. 
• Instant ISMS policy creation – Access 75+ pre-built policies or customize your own with expert guidance.
• Continuous control monitoring – Identify compliance gaps in real time with automated alerts and notifications.
• Automate evidence collection – Reduce manual work with 70+ integrations that automate >65% of evidence collection.
• Accelerate your audit – Collaborate seamlessly with auditors, share evidence, and track progress directly on the platform.

Grace Arundhati

Technical Content Writer at Scrut Automation