Mastering AWS Governance: Part 2 – Fine-tune AWS Service Control Policies (SCP) & AWS Organizations
Practical strategies for designing AWS Organizations with clean OU structures, efficient SCP management, cost control, and automation to support long-term scalability.
Published Apr 25, 2025
In Part 1 of this series, we explored how to fine-tune AWS Config and AWS Security Hub to build a strong foundation for governance and compliance in cloud environments. Building upon those principles, this next installment focuses on AWS Control Tower and AWS Service Catalog—two critical services that enable organizations to scale governance, standardize deployments, and empower teams with secure self-service capabilities.
As cloud ecosystems scale across multiple accounts, achieving consistent governance, security enforcement, and operational efficiency becomes exponentially harder. However, much like AWS Config and Security Hub, many organizations either over-restrict or underutilize SCPs, leading to operational friction, security gaps, and increased management overhead.
For cloud architects and engineers, the objective is clear: implement strategic governance that tightly controls environments without compromising agility and innovation.
In this article, we will explore best practices to optimize AWS Organizations and SCPs for enhanced governance, security, and cost management at scale.
Service Control Policies (SCPs) are powerful tools to control what actions IAM users and roles can perform across AWS accounts within an organization. Yet a common misstep is creating either overly broad or overly restrictive SCPs, which either leave security gaps or hinder developer productivity.
Optimizing SCPs requires a deliberate, layered approach: tightly controlling critical resources, allowing flexibility where safe, and applying policies intelligently across Organizational Units (OUs)
Effective governance doesn’t mean locking down every service—it means setting necessary guardrails that align with business and compliance requirements without unnecessarily limiting innovation.
Common Missteps:
- Applying blanket deny-all-except policies too early.
- Overlapping SCPs, leading to complexity and troubleshooting nightmares.
- Allowing broad access without scoping down critical operations.
The goal should be granular control: Deny risky actions by default, permit only necessary services, and apply service-specific controls where needed.
Example: Strategic Use of Deny Policies
Instead of forbidding all resource creation, deny only critical misconfigurations:
This SCP ensures only approved, cost-effective instance types can be launched, balancing governance with operational flexibility.
Similarly, deny expensive or risky services unless explicitly needed:
Such targeted controls maintain compliance without creating organizational friction.
An effective OU design is foundational for applying SCPs cleanly and predictably. Poor OU hierarchy often leads to a web of conflicting policies and operational confusion. Over time, this can create governance gaps that are difficult and costly to unwind. Thoughtful planning of OU design early in the journey ensures that as your AWS footprint grows, governance remains streamlined, transparent, and resilient.
Best Practice:
- Separate environments logically (e.g., Core, Workloads, Sandbox).
- Isolate high-risk accounts (e.g., Experimentation, Third-party Integrations) for stricter controls.
- Apply broader policies at the root or parent OU and finer-grained SCPs to child OUs.
Example OU Structure
This setup allows tight governance for critical systems while providing flexibility for development and innovation zones.
As environments mature, SCPs often multiply. Without governance on governance, it becomes easy to lose track of policy versions, exceptions, and active enforcement.Over time, small changes across multiple SCPs can introduce hidden risks if not properly tracked.
Key Strategies:
- Implement clear version tagging in SCP descriptions, including a short summary of changes and review dates.
- Use Infrastructure as Code (IaC) tools such as Terraform or CloudFormation to manage SCP definitions, ensuring version control, peer reviews, and rollback capabilities.
- Schedule regular audits to review active SCPs, identify redundant or outdated policies, and clean up stale entries.
- Document the business rationale behind each SCP, capturing the intended purpose, any exceptions allowed, and links to relevant governance decisions.
Example of tagging in SCP descriptions:
A simple description with version tagging can make life a lot easier by clearly documenting changes and review dates. Good version management not only reduces operational confusion but also strengthens compliance tracking during audits and simplifies onboarding for new team members.
Beyond security and compliance, SCPs can be powerful tools for controlling cloud spend by preventing usage of expensive resources. SCPs help enforce financial discipline at the organizational level, reducing the need for reactive cost-cutting measures later.
Practical Techniques:
- Block high-cost instance types or services (e.g., EC2 bare metal, GPU-based instances unless necessary).
- Prevent unsanctioned regions to avoid data sovereignty and cost issues.
- Disallow use of commercial marketplace products unless pre-approved.
For example, restrict usage only to approved AWS regions:
This ensures resources are only provisioned in compliant, cost-effective regions.
Automation is essential for scaling AWS Organizations effectively. Manual changes across multiple accounts and OUs quickly become error-prone and unsustainable as environments grow. Leveraging automation early not only improves consistency but also reduces operational overhead, freeing up teams to focus on higher-value initiatives.
Recommendations:
- Use AWS Control Tower for easier account baselining.
- Automate account creation with Landing Zone frameworks.
- Integrate Organizations events with AWS EventBridge for policy compliance monitoring.
Example: Automatically notify security teams when a new account joins the Organization without the required SCPs:
Trigger a Lambda function that attaches baseline SCPs upon detection.
AWS Organizations and Service Control Policies (SCPs) provide unparalleled capabilities to implement centralized, scalable governance. However, without strategic planning, they can create either operational bottlenecks or security blind spots.
By fine-tuning SCPs to focus on guardrails rather than handcuffs, designing effective OU structures, minimizing policy sprawl, and integrating automation, organizations can enforce strong governance at scale — all while enabling teams to move fast, innovate, and remain compliant.
In the next article of the series, we’ll dive into mastering governance with AWS IAM Identity Center (formerly AWS SSO), Permission Sets optimization and others to deliver scalable, least-privilege access across AWS accounts.
Contributors:
- Ajith Joseph, Specialist Master, Deloitte LLP
- Najeeb Danish, Specialist Leader, Deloitte LLP
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Disclaimer: Please note that AWS technology is constantly evolving, and new features may be available since the release of this blog post. It's recommended to review the latest documentation to determine the most suitable solutions for your specific needs. This blog is a reference guide only. Additionally, ensure that the proposed solutions comply with your organization's security and compliance requirements, as some services may be relatively new and may not be fully compliant with all industry standards.