ISO/IEC 38506:2020

INTERNATIONAL ISO/IEC
STANDARD 38506
First edition
2020-02
Information technology —
Governance of IT — Application of
ISO/IEC 38500 to the governance of IT
enabled investments
Technologies de l'information — Gouvernance des technologies de
l'information — Application de l'ISO/IEC 38500 à la gouvernance des
investissements reposant sur les technologies de l’information
Reference number
©
ISO/IEC 2020
© ISO/IEC 2020
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Published in Switzerland
ii © ISO/IEC 2020 – All rights reserved

Contents Page
Foreword .iv
Introduction .v
1 Scope . 1
2 Normative references . 1
3 Terms and definitions . 1
4 Good governance of IT enabled investments . 2
4.1 Benefits of good governance of IT enabled investments . 2
4.2 Focus on value . 2
4.3 Accountability of the governing body . 3
5 The model for good governance of IT enabled investments . 4
5.1 The model for good governance applied to the governance of IT enabled investments. 4
5.1.1 Evaluate . 5
5.1.2 Direct . 5
5.1.3 Monitor . . 6
6 Principles for governance of IT enabled investments . 6
6.1 General . 6
6.2 Principle 1 — Responsibility . 7
6.2.1 Applying the principle . 7
6.2.2 Implications for the governing body . 7
6.2.3 Desired outcomes . . 7
6.2.4 Governance behaviours . 7
6.3 Principle 2 — Strategy . 8
6.3.1 Applying the principle . 8
6.3.2 Implications for the governing body . 8
6.3.3 Desired outcomes . . 8
6.3.4 Governance behaviours . 9
6.4 Principle 3 — Acquisition . 9
6.4.1 Applying the principle . 9
6.4.2 Implications for the governing body . 9
6.4.3 Desired outcomes . .10
6.4.4 Governance behaviours .10
6.5 Principle 4 — Performance .10
6.5.1 Applying the principle .10
6.5.2 Implications for the governing body .10
6.5.3 Desired outcomes . .11
6.5.4 Governance behaviours .11
6.6 Principle 5 — Conformance .11
6.6.1 Applying the principle .11
6.6.2 Implications for the governing body .11
6.6.3 Desired outcomes . .12
6.6.4 Governance behaviours .12
6.7 Principle 6 — Human behaviour .12
6.7.1 Applying the principle .12
6.7.2 Implications for the governing body .12
6.7.3 Desired outcomes . .13
6.7.4 Governance behaviours .13
Bibliography .14
© ISO/IEC 2020 – All rights reserved iii

Foreword
ISO (the International Organization for Standardization) and IEC (the International Electrotechnical
Commission) form the specialized system for worldwide standardization. National bodies that
are members of ISO or IEC participate in the development of International Standards through
technical committees established by the respective organization to deal with particular fields of
technical activity. ISO and IEC technical committees collaborate in fields of mutual interest. Other
international organizations, governmental and non-governmental, in liaison with ISO and IEC, also
take part in the work.
The procedures used to develop this document and those intended for its further maintenance are
described in the ISO/IEC Directives, Part 1. In particular, the different approval criteria needed for
the different types of document should be noted. This document was drafted in accordance with the
editorial rules of the ISO/IEC Directives, Part 2 (see www .iso .org/ directives).
Attention is drawn to the possibility that some of the elements of this document may be the subject
of patent rights. ISO and IEC shall not be held responsible for identifying any or all such patent
rights. Details of any patent rights identified during the development of the document will be in the
Introduction and/or on the ISO list of patent declarations received (see www .iso .org/ patents) or the IEC
list of patent declarations received (see http:// patents .iec .ch).
Any trade name used in this document is information given for the convenience of users and does not
constitute an endorsement.
For an explanation of the voluntary nature of standards, the meaning of ISO specific terms and
expressions related to conformity assessment, as well as information about ISO's adherence to the
World Trade Organization (WTO) principles in the Technical Barriers to Trade (TBT) see www .iso .org/
iso/ foreword .html.
This document was prepared by Joint Technical Committee ISO/IEC JTC 1, Information technology,
Subcommittee SC 40, IT Service Management and IT Governance.
Any feedback or questions on this document should be directed to the user’s national standards body. A
complete listing of these bodies can be found at www .iso .org/ members .html.
iv © ISO/IEC 2020 – All rights reserved

Introduction
In today’s rapidly evolving digital age, the world is experiencing unpredictable changes through shifts
in political and economic power combined with disruptive business models, seemingly constant
technology breakthroughs and innovative approaches to conducting business.
How can governing bodies prepare their organizations to address constant and new challenges while
being ready for an increasing information and technology driven future?
Information Technology (IT) supports the core functions of all organizations, underpins the basis of
almost all business activities and interfaces with customers and other stakeholders. Investments in IT
enablement and the contribution of IT to the business capability and performance of the organization
play a significant role in the achievement of strategic plans and the delivery of business value.
Effective governance of IT enabled investments will provide governing bodies with a better
understanding of their obligations and how value is derived to support the organization’s business
opportunities and to appropriately mitigate the organisation's risk.
Risks comprise such things as the failure to deliver required capabilities, failure of the business to
achieve the required benefits, with the impact on the organization leading to e.g. business disruption,
breach of obligations, regulatory non-compliance, failures of security, loss of data, down time. Effective
governance will proactively prevent or mitigate the IT aspects of the risk of such events occurring, for
example, by addressing prolonged underinvestment.
Governance of IT, including investments in IT, is part of sound corporate governance. Governance of IT
is not IT management but should be supported by a governance framework and the organization’s IT
management system.
This document provides guidelines to members of the governing bodies to apply the principles and
model documented in ISO/IEC 38500 to IT enabled investments. Throughout this document the word
"investments" is synonymous with IT enabled investments.
© ISO/IEC 2020 – All rights reserved v

INTERNATIONAL STANDARD ISO/IEC 38506:2020(E)
Information technology — Governance of IT — Application
of ISO/IEC 38500 to the governance of IT enabled
investments
1 Scope
This document provides guidance on governance of IT enabled investments to the governing body
of all forms of organizations, whether private, public or government entities, and will equally apply
regardless of the size of the organization or its industry or sector. The terms business and business
outcome throughout this docum
...