Cloud monitoring and incident handling

Cloud environments fail differently than on-prem: identity is the new perimeter, control-plane actions can be more dangerous than host-level malware, and shared responsibility changes what you can see and what you can fix. ISO/IEC 27017’s guidance for cloud security controls (see overview) sets the expectation that organizations monitor cloud security events and respond to incidents effectively ¹.

For a Compliance Officer, CCO, or GRC lead, the practical question is not “do we have a SIEM,” but “can we prove we detect the events that matter in our cloud footprint, route them to accountable responders, and execute repeatable incident handling that works with our cloud provider and third parties?” Auditors tend to probe two gaps: missing telemetry (you cannot detect what you do not log) and generic incident response (IR) plans that ignore cloud-specific containment and evidence collection.

This page translates the cloud monitoring and incident handling requirement into a short set of operational commitments, concrete implementation steps, and a retention package you can hand to internal audit, customers, or certification assessors.

Regulatory text

Provided excerpt (summary-level): “Baseline implementation-intent summary derived from publicly available framework overviews; licensed standard text is not reproduced in this record.” ¹
Plain-language summary: Monitor cloud security events and respond to incidents effectively. ¹

What the operator must do

You need two things working together:

1. Monitoring that covers cloud-specific security events (especially identity and control plane activity), and
2. Incident handling that is cloud-aware, including shared-responsibility boundaries, provider escalation paths, and procedures to preserve cloud-native evidence.

A program can be “secure” in design and still fail this requirement if you cannot show consistent detection coverage, clear on-call ownership, and repeatable response actions with evidence.

Plain-English interpretation of the cloud monitoring and incident handling requirement

Meeting the cloud monitoring and incident handling requirement means:

• You collect and review the right cloud logs (control plane, identity, network, workload, and key SaaS signals).
• You alert on defined suspicious patterns (not just “high CPU”).
• You triage alerts consistently, open incidents, and escalate based on severity.
• You contain incidents using cloud-native actions (disable keys, revoke tokens, isolate instances, change security group rules, rotate credentials, snapshot disks).
• You coordinate with cloud providers and relevant third parties under pre-defined rules of engagement.
• You document what happened, what you did, and what you changed to prevent recurrence.

Who it applies to

ISO/IEC 27017 is written for both cloud customers and cloud service providers ¹. In practice, this requirement applies when:

Entity types

• Cloud customers running workloads in IaaS/PaaS, adopting SaaS, or processing regulated data in cloud services.
• Cloud providers offering IaaS/PaaS/SaaS and operating the underlying platform, management plane, and support processes.

Operational contexts where audits focus

• Production cloud subscriptions/accounts/projects with customer data.
• High-risk systems: identity providers, CI/CD, secrets stores, logging pipelines, customer-facing APIs.
• Environments with multiple third parties (managed service providers, SOC providers, IR retainers, SaaS tools) where responsibility is easy to blur.

What you actually need to do (step-by-step)

Step 1: Define scope and shared responsibility (customer vs provider vs third party)

Create a one-page Cloud Responsibility Matrix that answers:

• Which party monitors which logs (customer SOC, provider security team, MSSP)?
• Who can take containment actions (disable account, quarantine workload, revoke tokens)?
• Who must be notified, and how (provider support portal, phone escalation, contractual contacts)?
• Which systems are “customer-managed” vs “provider-managed” vs “third-party managed.”

This document prevents the classic failure mode: alerts go to the wrong team, or responders lack permissions to act.

Step 2: Build a cloud monitoring coverage map (telemetry inventory)

Create a Cloud Logging & Detection Coverage Map for each cloud environment (and key SaaS platforms). For each platform, list:

• Log sources: identity/auth logs, admin/control-plane audit logs, network flow logs, workload/OS logs (where applicable), SaaS audit logs, KMS/key usage logs, container orchestration audit logs.
• Collection method: native export, agent, API pull, event streaming.
• Destination: SIEM/data lake/log analytics tool.
• Retention and access: who can read logs, who can change settings, how changes are approved.

Deliverable outcome: you can point an auditor to a document that shows “these cloud services produce these logs; they land here; these teams review them.”

Step 3: Define “security events that matter” and align detections

Maintain a Cloud Security Event Catalog that lists events you consider security-relevant, such as:

• Identity anomalies: impossible travel patterns, excessive failed logins, MFA disabled, new privileged role assignments.
• Control plane risks: logging disabled, new access keys created, security group/firewall opened broadly, new OAuth app consent, new service account keys.
• Data access risks: unusual object storage reads, bulk export, key usage anomalies.
• Workload indicators: suspicious process execution, crypto-mining patterns, unexpected outbound connections.

Then map each event to:

• A detection rule (or a manual review procedure).
• The owning team (SOC, cloud security, platform team).
• The expected response playbook (next step).

Step 4: Establish triage and incident thresholds

Write down:

• Alert severity definitions (what makes something “incident-worthy” in cloud).
• Triage steps (confirm, enrich, scope).
• Escalation triggers (privileged account involved, logging tampered with, customer data at risk).

Make this operational: configure on-call routing and ensure responders can access cloud consoles, logs, and ticketing systems.

Step 5: Build cloud-specific incident playbooks (minimum viable set)

Your incident response plan must have playbooks that call out cloud-native actions and evidence sources. Start with playbooks for:

• Credential compromise / key leak (API keys, access tokens, service account keys)
• Privileged role misuse
• Logging disabled / audit tampering
• Public exposure (storage bucket/container made public, firewall opened)
• Suspicious workload behavior (malware, crypto-mining, unusual egress)
• Third-party compromise affecting cloud (CI/CD vendor, MSP, SaaS integration)

Each playbook should include:

• Required logs to pull (and from where).
• Containment steps (revoke tokens, rotate keys, disable accounts, isolate workloads).
• Evidence preservation (snapshots, log exports, ticket notes).
• Internal and external notifications (provider, affected third parties, customers as applicable).
• Recovery steps and post-incident review requirements.

Step 6: Test the playbooks and prove they work

Run tabletop exercises and at least one hands-on simulation per critical playbook. Capture:

• Who participated.
• What failed (permissions, missing logs, slow escalation).
• Remediation actions with owners.

Auditors accept “we found gaps and fixed them” more readily than “we never tested.”

Step 7: Operationalize governance and change control for monitoring

Monitoring is fragile. Add control points:

• Changes to logging settings require approval and generate an alert.
• New cloud accounts/projects cannot go live without baseline logging and alerting.
• Quarterly (or risk-based) reviews of detection coverage against new services and new threats.

Step 8: Make it audit-ready with a single evidence packet

Package the artifacts below into one folder per environment. Tools like Daydream help by turning this requirement into a checklist of required artifacts, owners, and review cadence, so you can show “designed + operating” evidence quickly during ISO readiness work.

Required evidence and artifacts to retain

Keep evidence that shows both design (you planned it) and operation (you ran it):

Monitoring evidence

• Cloud Logging & Detection Coverage Map (by environment/account).
• Log configuration baselines and screenshots/exports (where feasible).
• Alert rules list (or SIEM correlation rule inventory) tied to the event catalog.
• On-call rota and alert routing configuration.
• Samples of alerts and triage notes (tickets/cases).

Incident handling evidence

• Cloud incident response playbooks with owners and last review date.
• Incident tickets with timeline, decisions, containment actions, and approvals.
• Post-incident reports (root cause, corrective actions, lessons learned).
• Tabletop/exercise records and remediation follow-ups.
• Provider and critical third-party escalation procedures and contact lists.

Governance evidence

• Access control for logging/SIEM and cloud admin roles (who can disable logging).
• Change management records for monitoring changes.
• Training completion records for responders (cloud console, evidence handling).

Common exam/audit questions and hangups

Auditors and customer assessors typically press on these points:

• Coverage: “Show me that all production cloud accounts are logging control-plane activity to a central system.”
• Tamper resistance: “Who can disable logging, and how do you detect that change?”
• Cloud specificity: “Your IR plan is generic. Where are the steps for key rotation, token revocation, snapshotting, and provider escalation?”
• Proof of operation: “Show recent alerts, triage decisions, and at least one incident post-mortem.”
• Shared responsibility: “Which incidents do you handle vs your cloud provider, and how do you coordinate?”

Hangup pattern: teams present a SIEM contract and an IR policy, but cannot show end-to-end execution from a cloud event to a closed incident with evidence.

Frequent implementation mistakes and how to avoid them

Mistake	Why it fails audits	How to avoid it
Logging turned on “somewhere,” but no inventory	You cannot prove scope or completeness	Maintain the coverage map; treat it as a controlled document
Monitoring focuses on host metrics only	Cloud compromises often start in identity/control plane	Add identity and admin activity signals to the event catalog
Playbooks assume on-prem actions	Cloud containment requires different steps and permissions	Write cloud-native playbooks and validate permissions during testing
Alerts route to teams without access	Responders waste time requesting permissions	Pre-provision break-glass roles and document access paths
Provider escalation is ad hoc	Delays and confusion during a real incident	Store escalation paths, SLAs, and portal procedures with the playbooks
Evidence is scattered	You fail “show me” requests under time pressure	Build an evidence packet per environment; keep it current in Daydream

Enforcement context and risk implications

No public enforcement cases were provided in the source catalog for this requirement, so this page does not cite specific actions. Practically, weak cloud monitoring and incident handling increases the chance that security events go undetected, evidence is lost, and response actions are inconsistent. For regulated environments, that can cascade into notification failures, contractual breaches, and unfavorable audit outcomes.

Practical 30/60/90-day execution plan

Days 1–30: Establish minimum viable coverage and ownership

• Confirm in-scope cloud environments and critical SaaS platforms.
• Draft the Cloud Responsibility Matrix (customer/provider/third party).
• Stand up the Cloud Logging & Detection Coverage Map (even if incomplete).
• Ensure control-plane audit logs and identity logs are collected centrally for production.
• Publish first three cloud playbooks: credential compromise, privileged role misuse, logging disabled.

Days 31–60: Expand detections and make response repeatable

• Build the Cloud Security Event Catalog and map events to detections and playbooks.
• Implement alert routing, on-call ownership, and severity definitions.
• Run one tabletop exercise focused on credential compromise and key rotation.
• Implement monitoring change control: alerts on logging disablement and admin changes.
• Start an evidence packet structure and backfill artifacts for the prior month.

Days 61–90: Prove operational maturity and close audit gaps

• Conduct a hands-on simulation (or controlled detection test) for at least one scenario.
• Review third-party dependencies: SOC provider runbooks, MSP access, SaaS audit logs.
• Add playbooks for data exposure and suspicious workload behavior.
• Produce a management-ready report: coverage gaps, remediation owners, and a dated test record.
• Load requirement tasks, owners, and evidence links into Daydream to keep artifacts current for audits and customer reviews.

Frequently Asked Questions

Do we need a SIEM to meet the cloud monitoring and incident handling requirement?

You need centralized collection and review of cloud security events with provable alerting and case handling. A SIEM is a common way to do this, but the requirement is satisfied by outcomes: coverage, detection, response execution, and retained evidence.

What cloud logs should auditors expect to see first?

Start with identity/authentication logs and control-plane/admin audit logs, then add network and workload telemetry where applicable. If you cannot show who did what in the control plane, incident reconstruction will be weak.

How do we handle the shared responsibility model during an incident?

Write a Cloud Responsibility Matrix and attach provider escalation steps to each playbook. During response, document which actions you took and which were routed to the provider, with timestamps and ticket references.

How do we prove incidents are handled “effectively” if we haven’t had a real incident?

Use tabletop exercises and controlled simulations to demonstrate triage, containment steps, evidence collection, and follow-up remediation. Keep the exercise records and remediation tickets as your operating evidence.

What evidence do assessors ask for most often?

A detection coverage map, a list of cloud-relevant alert rules, recent alert/incident tickets with timelines, cloud-specific playbooks, and proof that you tested the process. Keep these in a single evidence packet to avoid last-minute scrambling.

Where does Daydream fit into operationalizing this requirement?

Daydream helps you assign owners, track review cadence, and store evidence links for monitoring coverage, playbooks, exercises, and incident records. That reduces the “we have it, but can’t prove it fast” failure mode during audits.

Related compliance topics

• 2025 SEC Marketing Rule Examination Focus Areas
• Access and identity controls
• Access Control (AC)
• Access control and identity discipline
• Access control management

Footnotes

1. ISO/IEC 27017 overview