ISO 27001
International standard for information security management systems
Basel III
Global framework for bank capital, leverage, and liquidity standards
Quick Verdict
ISO 27001 provides voluntary ISMS certification for all industries worldwide, while Basel III mandates capital, liquidity, and leverage rules for banks. Organizations adopt ISO 27001 for security resilience and market trust; Basel III ensures financial stability and regulatory compliance.
ISO 27001
ISO/IEC 27001:2022
Key Features
- Risk-based Information Security Management System
- PDCA cycle for continual improvement
- 93 Annex A controls in four themes
- Internationally recognized certification standard
- Technology- and industry-agnostic framework
Basel III
Basel III: Finalising post-crisis reforms
Key Features
- Strengthened CET1 capital requirements and buffers
- Non-risk-based leverage ratio backstop
- Liquidity Coverage Ratio for 30-day stress
- Net Stable Funding Ratio for funding stability
- Enhanced Pillar 3 RWA comparability disclosures
Detailed Analysis
A comprehensive look at the specific requirements, scope, and impact of each standard.
ISO 27001 Details
What It Is
ISO/IEC 27001:2022 is an international certification standard for establishing, implementing, maintaining, and improving an Information Security Management System (ISMS). It uses a risk-based approach to manage information assets' confidentiality, integrity, and availability across all industries.
Key Components
- **Clauses 4-10Mandatory requirements covering context, leadership, planning, support, operation, evaluation, and improvement.
- **Annex A93 controls in four themes (Organizational: 37, People: 8, Physical: 14, Technological: 34).
- Built on PDCA cycle for continual improvement.
- Certification via accredited auditors with Stage 1/2 audits, surveillance, and recertification.
Why Organizations Use It
- Mitigates breach risks amid rising cyber threats.
- Meets voluntary but essential compliance for tenders, insurers, partners.
- Enhances resilience, reduces incident costs (e.g., 30% fewer incidents).
- Builds trust, wins bids (20-30% more in finance/tech), enables market access.
Implementation Overview
- Phased: Initiation, risk assessment, deployment (6-18 months).
- Scalable for SMEs to enterprises; all sizes/industries.
- Requires audits for certification, ongoing PDCA.
Basel III Details
What It Is
Basel III is the global prudential regulatory framework issued by the Basel Committee on Banking Supervision (BCBS) post-2007-2009 financial crisis. It strengthens bank resilience through enhanced capital quality and quantity, leverage constraints, and liquidity standards. Its risk-based approach combines minimum requirements with supervisory review and disclosures.
Key Components
- **Three PillarsPillar 1 (capital ratios: CET1 4.5%, Tier 1 6%, Total 8%; leverage ratio 3%; LCR/NSFR); Pillar 2 (ICAAP, stress testing); Pillar 3 (comparability disclosures like KM1, LR1, CDC).
- Buffers (CCB 2.5%, CCyB, G-SIB/D-SIB).
- Output floor (72.5% standardized RWA).
- No formal certification; compliance via national implementation.
Why Organizations Use It
- Mandatory for internationally active banks to meet legal requirements.
- Mitigates systemic risk, improves funding costs, enhances resilience.
- Builds investor trust via transparent disclosures; shapes asset allocation.
Implementation Overview
- Phased enterprise transformation: governance, data systems, models.
- Involves QIS, parallel runs, training; applies to large banks globally.
- Ongoing supervisory audits, no external certification.
Key Differences
| Aspect | ISO 27001 | Basel III |
|---|---|---|
| Scope | Information security management systems (ISMS) | Bank capital, liquidity, leverage requirements |
| Industry | All industries, all sizes worldwide | Primarily banking sector globally |
| Nature | Voluntary certification standard | Mandatory prudential regulatory framework |
| Testing | Internal/external certification audits | Supervisory review, stress testing, reporting |
| Penalties | Loss of certification, reputational damage | Fines, capital add-ons, business restrictions |
Scope
Industry
Nature
Testing
Penalties
Frequently Asked Questions
Common questions about ISO 27001 and Basel III
ISO 27001 FAQ
Basel III FAQ
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