How to perform Compliance Gap Analysis?
Sep 23, 2023
When it comes to compliance, starting off on the right foot requires surveying your present conditions. It has a defining impact on how fast companies get to the audit-ready phase and reap the benefits of certification. Chief compliance officers see compliance gap analysis as a guiding method to steering their compliance efforts.
Conducting a thorough gap analysis tells you directly the strengths and weaknesses of your security posture. It is also an exercise that directly points towards the compliance maturity of your organization and helps you come up with better strategies to improve your security posture.
This blog aims to help you with the process of regulatory gap analysis along with examples so you can kickstart the journey fast and right.
What is a compliance gap analysis?
A compliance gap analysis is a detailed review of your company’s current state of compliance. It helps identify areas and controls within the organization that are failing certain parameters defined by the desired state. This sets the course to corrective action and realignment with compliance requirements.
Defining the scope of compliance gap analysis
The scope of compliance gap analysis defines the boundaries of analysis including compliance functions, stakeholders, and success criteria. The scope must be narrowed down to make the process less time-consuming, expensive, and complicated.
The scope includes defining the following:
- Area of compliance under evaluation
- The regulatory compliance standards and criteria that will serve as the benchmark
- The review period specified within the objective
The definition of scope will require you to list all people, processes, and technologies that is to be included within the exercise. Asking the right questions can help you understand and define the scope more accurately. Here are some examples:
- What are the compliance/regulatory requirements that apply to my business?
- Which assets (physical or digital) store or process critical information?
- Which policies and standard operating procedures govern the storage and processing of this critical information?
- Which key stakeholders and ‘people checks’ should be evaluated for compliance adherence?
Continuous Compliance for 24/7 Peace of Mind
How Sprinto helps:
Sprinto helps in the scoping exercise in two ways:
- Most frameworks are broad and generic. It becomes hard to figure out which compliance areas apply to cloud companies. Sprinto is purpose-built to fit the requirements of cloud-based solutions which expedites mapping of relevant controls to industry standards and scope out gaps.
- Sprinto also lets you mark production and non-production items as well as in-scope and not-in-scope for people and devices. This makes the process of establishing the scope a simple task.
When do you need to perform a compliance gap analysis?
A compliance gap analysis must be a regular exercise to ensure the organization’s compliance status is strong at all times. It must be performed:
- Implementing compliance for the first time: Compliance gap analysis is usually conducted after risk assessments and before implementing controls.
- In case of regulatory updates: Compliance gap analysis is performed when there are significant changes in regulatory compulsions that cause the current processes to change
- During internal audits: Conducting compliance gap analysis during internal audits will tell you how close you are to audit-readiness
How to conduct a compliance gap analysis
The process of gap analysis aims at developing a plan of action to bridge the differences between the current and ideal state of compliance. This requires an identification of applicable requirements to facilitate their comparison with existing practices and implementing a corrective action.
Here are 5 steps to conduct a compliance gap analysis:
Define requirements and scope
As with any exercise, it’s important to start by defining the objective. Create a scoping statement that specifies the processes, policies, and people you’re measuring and how you’re going to gauge status and performance.
Determine ideal state and benchmarks
This step involves researching the regulatory requirements and industry best practices needed to establish benchmarks. This is the ideal state the organization wants to achieve. Based on this research, you can set specific and time-bound goals along with key performance indicators.
Compare with existing policies
Document existing policies and practices and compare them with the defined desired state to map compliance gaps.You may find policies that are outdated, causing controls to fail. The comparison therefore sets the context for corrective action as well as new initiatives that need to be carried out.
Implement action plan
Use a risk matrix to identify the severity of risks posed by compliance gaps. Label them as critical, high, medium and low based on impact. These insights help you prioritize critical actions over low priority ones. It is also important to assign owners to each item to ensure transparency and accountability throughout the process.
Track progress and report
The organization’s desired state must be ‘continuously compliant’. This requires you to regularly monitor progress to ensure your security posture improves consistenly. If any further deviations are identified during surveillance, these must be immediately reported and fixed.
A compliance automation and gap analysis tool like Sprinto makes this process easier by monitoring controls 24/7 and providing real-time insights into the company’s compliance posture. The platform intuitively alerts security teams when controls are about to fail and suggests actions that help them eliminate security and compliance gaps.
Also, check out: Guide to Compliance Management System
Compliance gap analysis examples
Now that you have understood the steps for conducting a compliance gap analysis let’s further your understanding with examples.
PCI DSS gap analysis
An organization wants to conduct a gap analysis for the PCI DSS compliance framework.
- It will first begin the scoping exercise to include all processes, people and system components interacting with CDE (cardholder environment). Technologies like network segmentation (for cardholder data storage and processing) are used to make the PCI DSS scoping process easier.
- The organization’s ideal state will be meeting all 12 requirements under the PCI standard.
- Next, the company will document existing SOPs and controls for securing CDE and compare it to PCI DSS best practices. If the company discovers, for instance, that some employees are not updating their antivirus and performing periodic scans, which violates PCI requirement 5, then correction will be necessary.
- This compliance gap and a security breach under PCI DSS can attract non-compliance repercussions and is a high-risk item (score 7-10) that must be prioritized immediately for remedial actions.
- So, as a corrective action the security policy for safeguarding cardholder data will be updated to meet requirement 5.
All systems handling sensitive cardholder data will have an antivirus installed or updated. The software will be reconfigured to ensure the right settings. The system will be scanned for any existing threats and continuously monitored and maintained.
HIPAA compliance gap analysis
- Employees sending unencrypted emails containing PHI – A violation of HIPAA privacy (45 CFR 164.502-uses and disclosure of PHI) and security rule (technical safeguards)
- Disposing of PHI records in paper records which are readable- A violation of HIPAA privacy (45 CFR 164.310-limiting physical access) and security rule (physical safeguards)
Source: HIPAA journal: An example of gap analysis by OCR
SOC 2 compliance gaps
- Weak password policies and lack of Multi-Factor Authentication- Non-alignment with SOC 2 security controls (protection of systems from unauthorized access/ disclosure)
- A missing incident response plan- Non-alignment with common criteria under SOC 2 security TSC
ISO 27001 compliance gaps
- Not arranging security awareness training for employees: Non-compliance with Annex A Control 6.3 (ISO 27001:2022)
- Having an outdated inventory of crucial information assets: Non-compliance with Annex A Control 5.9 (Inventory of Assets)
Benefits of compliance gap analysis
Compliance gap analysis provides a strategic path for companies to align business cases with regulatory requirements. It helps the top management emphasize on the right areas, allocate the right resources, and move ahead with execution.
Here are the top 4 benefits of compliance gap analysis:
Helps prioritize compliance efforts
A comprehensive gap analysis provides insights into the severity and impact of identified gaps. This serves as a practical navigator for decision-makers to narrow down on compliance priorities and focus their efforts.
Enables proactive risk mitigation
Compliance gap analysis helps uncover non-compliance issues and areas prone to exploitation. This enables the implementation of proactive measures to minimize potential financial, legal, operational, and reputational risks.
Conducting a gap analysis before control implementation enables allocating the right resources for compliance tasks. This includes people, technologies, and other investments. In the long run, there are also cost savings as the organizations are saved from regulatory scrutiny and legal fines associated with non-compliance.
Adds structured approach to processes
Compliance gap analysis streamlines workflows and helps navigate compliance complexities with a structured approach to fixing vulernabilities. Organizations change policies, create SOPs, and implement internal controls to fix identified weaknesses and reach scores that are closer to benchmarks.
Automate compliance gap analysis with Sprinto
A regulatory compliance gap analysis is a crucial exercise that ensures that organizations are not shooting arrows in the dark. It lays the foundation towards a stronger security posture by focusing energy and internal resources towards fixing gaps. However, internal teams can find this process challenging in practice.
Sprinto is an automation-first compliance tool that will help uncover gaps in compliance and assist you with a detailed action plan. The platform helps you run automated checks, pinpoints opportunities for improvement, guides you towards a more proactive, structured approach to compliance.
Talk to a compliance expert today and kickstart your compliance journey.
Can I hire a consultant or third-party service for compliance gap analysis?
Yes, you can hire a consultant or third-party service for compliance gap analysis, but that will add to the costs. A compliance automation solution like Sprinto can be a smarter alternative to help you navigate all compliance complexities and breeze through audits.
What are some best practices for compliance gap analysis?
Best practices for compliance gap analysis include conducting in-depth assessments, documenting everything, involving key stakeholders, and arranging workforce training.
Who should be performing the gap analysis?
Data protection officers, IT and security teams, and legal experts must perform the compliance gap analysis.
Payal is your friendly neighborhood compliance whiz! She turns perplexing compliance lingo into actionable advice about keeping your digital business safe and savvy. When she isn’t saving virtual worlds, she’s penning down poetic musings or lighting up local open mics. Cyber savvy by day, poet by night!
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