ISO/IEC 42001:2023
International standard for AI management systems
APRA CPS 234
Australian prudential standard for information security resilience
Quick Verdict
ISO/IEC 42001:2023 offers voluntary global AI governance certification for all organizations, while APRA CPS 234 mandates information security resilience for Australian financial entities with strict board accountability and APRA notifications.
ISO/IEC 42001:2023
ISO/IEC 42001:2023 Artificial Intelligence Management Systems
Key Features
- Mandates AI Impact Assessments for high-risk systems
- Annex A with 38 AI-specific controls
- PDCA methodology on High-Level Structure (HLS)
- Governs full AI lifecycle management
- Integrates seamlessly with ISO 27001/9001
APRA CPS 234
APRA Prudential Standard CPS 234 Information Security
Key Features
- Board ultimate responsibility for information security
- 72-hour APRA notification for material incidents
- Includes third-party managed information assets
- Systematic independent control testing required
- Asset classification by criticality and sensitivity
Detailed Analysis
A comprehensive look at the specific requirements, scope, and impact of each standard.
ISO/IEC 42001:2023 Details
What It Is
ISO/IEC 42001:2023 is the world's first international standard for Artificial Intelligence Management Systems (AIMS). It provides requirements for establishing, implementing, maintaining, and improving AIMS using Plan-Do-Check-Act (PDCA) methodology and High-Level Structure (HLS), applicable to any organization handling AI.
Key Components
- Clauses 4-10 cover context, leadership, planning, support, operation, evaluation, improvement.
- **Annex A38 AI-specific controls for risks like bias, transparency.
- Built on PDCA and HLS for interoperability.
- Third-party certification via accredited audits.
Why Organizations Use It
- Mitigates AI risks (bias, ethics, drift) while enabling innovation.
- Aligns with EU AI Act, NIST; enhances compliance.
- Builds trust, reputation; procurement advantages (e.g., Microsoft requirements).
- Cost savings via ISO integrations; insurance discounts.
Implementation Overview
- Phased: gap analysis, AIIAs, controls rollout.
- 6-12 months typical; tools like ISMS.online accelerate.
- Universal for all sizes/sectors; no prerequisites beyond AIMS setup.
APRA CPS 234 Details
What It Is
APRA Prudential Standard CPS 234 (Information Security) is a binding Australian regulation for financial institutions. Effective from 1 July 2019, it requires entities to maintain information security capabilities commensurate with threats and vulnerabilities, minimizing impacts on confidentiality, integrity, and availability (CIA) of information assets, including those managed by third parties. It adopts a risk-based, assurance-driven approach focused on governance and resilience.
Key Components
- Board ultimate responsibility and defined roles (paras 13-14)
- Asset classification by criticality/sensitivity (para 20)
- Commensurate controls across asset lifecycle (para 21)
- Systematic testing and independent assurance (paras 27-34)
- Incident response plans with annual testing (paras 23-26)
- **APRA notifications72 hours for material incidents, 10 business days for unremediable weaknesses (paras 35-36) No fixed controls; proportional to risk, aligned with CIA triad.
Why Organizations Use It
- Mandatory for APRA-regulated entities (ADIs, insurers, super funds)
- Ensures prudential compliance, cyber resilience, stakeholder protection
- Reduces incident risks, enhances trust, supports sound operations
- Drives competitive edge via robust third-party oversight
Implementation Overview
Phased: gap analysis, governance/policy setup, asset inventory/classification, controls/testing, third-party assessments. Suited for Australian financial sector, all sizes. Compliance via internal audit, Board oversight; no external certification but APRA supervision. (178 words)
Key Differences
| Aspect | ISO/IEC 42001:2023 | APRA CPS 234 |
|---|---|---|
| Scope | AI management systems lifecycle governance | Information security and cyber resilience |
| Industry | All sectors worldwide, any organization | Australian financial services only |
| Nature | Voluntary international certification standard | Mandatory prudential regulation |
| Testing | Performance evaluation, internal audits, reviews | Systematic independent control testing annually |
| Penalties | Loss of certification, no legal penalties | Regulatory sanctions, fines, enforcement actions |
Scope
Industry
Nature
Testing
Penalties
Frequently Asked Questions
Common questions about ISO/IEC 42001:2023 and APRA CPS 234
ISO/IEC 42001:2023 FAQ
APRA CPS 234 FAQ
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