ISO 27001 is an internationally recognized standard to establish an information security management system (ISMS). Implementing ISO 27001 provides organizations a better way to manage and secure their information assets. That includes intellectual property, financials, employee details, customer data, and information entrusted by third parties.

Achieving ISO 27001 compliance lets companies demonstrate that they are less vulnerable to security incidents or data breaches. Certifying their adherence to the standard can boost their reputation for trustworthiness and lower the chance of financial damages that may result from a cybersecurity incident.

Compliance with ISO 27001 begins with a risk assessment. A robust risk assessment process can help you evaluate your information security risks, prioritize them by likelihood of occurrence and potential impact, and find the most appropriate ways to minimize or mitigate them.

This article outlines the main steps of the ISO 27001 risk assessment procedure to help you achieve ISO 27001 compliance with minimal friction or hassle.

What Is ISO 27001?

ISO 27001 is a worldwide information security standard. It specifies the requirements for an information security management system (ISMS).

ISO 27001 is a type of ISO standard that assists organizations in establishing, implementing, operating, monitoring, reviewing, maintaining, and continuously improving an ISMS. It is part of the ISO 27000 set of information security standards.

Organizations may manage their information security with the support of ISO 27001’s best-practice approach, which considers people, processes, and technology. The ISO 27001 Standard certification is recognized globally as proof that your ISMS aligns with best information security practices.

The ISO 27001 information security standard was updated in 2013, replacing the previous version from 2005.

What is an information security management system (ISMS)?

An ISMS consists of policies, methods, and procedures designed to manage information security risks in an organized and systematic manner. Businesses can secure their confidential, personal, and sensitive data by creating, deploying, administering, and maintaining an ISMS.

How Does ISO 27001 Work?

ISO 27001 employs a top-down, technology-agnostic, risk-based approach. The standard specifies six planning procedures:

  • Defining a security policy
  • Defining the scope of ISMS
  • Conducting risk assessments
  • Managing evaluated risks
  • Selecting control goals for implementation
  • Preparing the statement of applicability

ISO 27001 improves management accountability, guarantees continuous improvement, performs internal audits, and implements corrective and preventative measures by bringing all business departments together.

Why is ISO 27001 Important?

ISO 27001 offers businesses the knowledge they need to protect their most precious information. A company can also become ISO 27001-certified and demonstrate to its clients and partners that it protects their data. Even individuals can become ISO 27001-certified by taking a course and passing the exam, demonstrating their abilities to future employers.

ISO 27001 is easily recognized worldwide because it is an international standard, expanding the economic potential for enterprises and people.

ISO 27001 Risk Assessment Procedure: 7 Key Steps

Risk assessments can be challenging, but the ISO 27001 risk assessment process can be simplified into seven steps.

Define the Methodology

There is no standardized risk assessment methodology for ISO 27001, so you must define your methods. To start, review your organization’s unique profile by understanding the following:

  • The primary information security objectives you aim to achieve with ISO 27001
  • Your business, legal, and compliance obligations
  • The overall business goals and objectives
  • Stakeholders’ expectations and needs

Determine whether you will use a qualitative or a quantitative approach to assess risk. A qualitative assessment is subjective; it focuses on identifying risks, and then estimating their likelihood of occurrence and potential impact. A quantitative approach uses verifiable data to analyze identified threats and assign a numerical value to them (say, likely dollar value of a disruption). Use the method most relevant to your information security goals.

Create an Asset Inventory

You can perform a risk assessment for ISO 27001 in one of two ways: focusing on assets (that is, the risk to information), or focusing on scenarios that might result in a data breach.

In a scenario-based risk assessment, users are more prone to identify risk situations, often speeding up the risk identification process. The drawback, however, is that users often need to catch up on some elements that may create risk. As a result, the risk identification is incomplete and results in a false (and dangerous) sense of safety.

With the asset-based approach, identifying relevant risks usually takes longer. That said, it yields a complete view of risk posture, so consider this method.

Start by compiling your asset inventory. This should include all your:

  • Hardware
  • Software
  • Devices
  • Information databases
  • Removable devices
  • Mobile devices
  • Intellectual property

To compile the list, check with all asset owners – the individuals or entities responsible for controlling asset use, maintenance, and security.

Identify Potential Vulnerabilities and Threats

Once you have the asset register, analyze the risk to each asset. First, identify potential vulnerabilities, such as a weakness that a threat may exploit. For example, a glitch or security vulnerability in a software or operating system can make your organization vulnerable to hackers who could infiltrate and compromise your assets or steal your data.

Determine Risk Impact

After identifying vulnerabilities and threats, analyze the risks associated with them. Not all risks are equally severe; you might not want to implement onerous measures or controls to mitigate, eliminate, or prevent risks that would cause little damage.

Hence it’s crucial to score risks based on the likelihood or probability of occurrence and the damage they can cause. Create a risk assessment matrix based on these factors to compare risks against your risk appetite and identify and prioritize risks requiring action.

Examine how the confidentiality, integrity, and availability of data (the “CIA triad’) could be affected by each risk. Also, consider different implications of each threat, including business, legal, contractual, and regulatory implications. To get going, ask:

  • What might be the cost of replacing a compromised asset?
  • What is the potential for financial loss (lost income, fines, and so forth)?
  • Could a security incident damage our reputation?

Create a Risk Treatment/Risk Management Plan

Now determine how you will treat each identified risk. Again, there are several options to choose from:

  • Avoid the risk. Take actions that negate the chance of the risk happening. For example, cease working with high-risk vendors.
  • Modify the risk. Apply security controls to reduce the probability of occurrence and the potential for damage. For example, implement a firewall or endpoint detection and response solution.
  • Transfer the risk. Share the risk with a third party, such as through buying a cybersecurity insurance policy.
  • Retain the risk. Accept the risk if it falls within established risk acceptance criteria or if the cost of mitigating it would be higher than the potential for damage.

According to ISO 27001, you must identify risk owners for all risks. This owner is responsible for approving any risk mitigation plans and for accepting the level of residual risk.

Implement controls as part of the mitigation plan outlined in Annex A of ISO 27001. For example, Annex A.12.2 requires defenses to mitigate the risk of malware infection. Similarly, A.13.1 concerns the maintenance of the CIA of information in networks. (Not every company will need to implement every control in Annex A. On the contrary, most companies will only need to implement a portion of those controls, whichever ones are most relevant to your business.)

Compile Risk Assessment Reports

You must prepare reports about your findings and implement an action plan for audit and certification.

Prepare the following reports:

  • A statement of applicability, which documents the various ISO 27001 controls that you will implement to tackle identified risks. Each control should have its own entry, and you should explain why any controls were omitted.
  • A risk treatment plan, which provides a summary of each identified risk, proposed actions to deal with each risk, and the parties responsible.

The certification auditor that reviews your ISO 27001 effort will use these reports as guidelines.

Should I Conduct an ISO 27001 Risk Assessment?

The ISO 27001 risk assessment provides a systematic way to evaluate your organization’s risks, understand how they may impact your information security, and implement an action plan to mitigate them.

ISO 27001 focuses on risk assessment and treatment, so you can find out which incidents could harm your information security and determine the most appropriate ways to avoid or deal with them.

Moreover, you can also assess the priority of each risk, so instead of wasting time, effort, or money on treating all risks, you can focus your efforts on the ones most serious. For all these reasons, an ISO 27001 risk assessment can benefit your organization.

Regardless of whether you adopt ISO 27001 within your organization, risk assessments are not merely an audit exercise. A dynamic risk assessment is a real-time process where risks are addressed as they are identified. These risks are also documented for proper tracking and control. Monitoring risk is everyone’s responsibility daily.

ZenRisk Helps Businesses with Risk Assessments

If you need help with ISO 27001 risk assessments, Reciprocity and ZenRisk can help. With advanced visibility into control environments, accessible audit environments, and easy access to information for program evaluation, ZenRisk is a fast, prescriptive solution for information security risk assessments and compliance.

Quickly assess and determine the acceptability of risk controls, get real-time control status, and compile evidence for auditors. With ZenRisk, you can easily streamline your InfoSec risk and compliance program.

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