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Password policy recommendations for Office 365

Contributors: Kweku Ako Adjei
Last updated 1 December, 2017

As the admin of an Office 365 organization, you're responsible for setting password policy for users in your organization. Setting password policy can be complicated and confusing, and this article provides recommendations to make your organization more secure against password attacks.

To set a custom password complexity policy for your organization, see Azure AD B2C: Configure complexity requirements for passwords.

To determine how often Office 365 passwords expire in your organization, see Set password expiration policy for Office 365.

Understanding password recommendations

Good password practices fall into a few broad categories:

  • Resisting common attacks This involves the choice of where users enter passwords (known and trusted devices with good malware detection, validated sites), and the choice of what password to choose (length and uniqueness).

  • Containing successful attacks Containing successful hacker attacks is about limiting exposure to a specific service, or preventing that damage altogether, if a user's password gets stolen. For example, ensuring that a breach of your social networking credentials doesn't make your bank account vulnerable, or not letting a poorly guarded account accept reset links for an important account.

  • Understanding human nature Many valid password practices fail in the face of natural human behaviors. Understanding human nature is critical because research shows that almost every rule you impose on your users will result in a weakening of password quality. Length requirements, special character requirements, and password change requirements all result in normalization of passwords, which makes it easier for attackers to guess or crack passwords.

Password guidelines for administrators

The primary goal of a more secure password system is password diversity. You want your password policy to contain lots of different and hard to guess passwords. Here are a few recommendations for keeping your organization as secure as possible.

  • Maintain an 8-character minimum length requirement (longer isn't necessarily better)

  • Don't require character composition requirements. For example, *&(^%$

  • Don't require mandatory periodic password resets for user accounts

  • Ban common passwords, to keep the most vulnerable passwords out of your system

  • Educate your users to not re-use their organization passwords for non-work related purposes

  • Enforce registration for multi-factor authentication

  • Enable risk-based multi-factor authentication challenges

Password guidance for your users

Here's some password guidance for users in your organization. Make sure to let your users know about these recommendations and enforce the recommended password policies at the organizational level.

  • Don’t use a password that is the same or similar to one you use on any other websites

  • Don’t use a single word, for example, password, or a commonly-used phrase like Iloveyou

  • Make passwords hard to guess, even by those who know a lot about you, such as the names and birthdays of your friends and family, your favorite bands, and phrases you like to use

Some common approaches and their negative impacts

These are some of the most commonly used password management practices, but research warns us about the negative impacts of them.

Password expiration requirements for users

Password expiration requirements do more harm than good, because these requirements make users select predictable passwords, composed of sequential words and numbers which are closely related to each other. In these cases, the next password can be predicted based on the previous password. Password expiration requirements offer no containment benefits because cyber criminals almost always use credentials as soon as they compromise them.

Requiring long passwords

Password length requirements (greater than about 10 characters) can result in user behavior that is predictable and undesirable. For example, users who are required to have a 16-character password may choose repeating patterns like fourfourfourfour or passwordpassword that meet the character length requirement but aren't hard to guess. Additionally, length requirements increase the chances that users will adopt other insecure practices, such as writing their passwords down, re-using them, or storing them unencrypted in their documents. To encourage users to think about a unique password, we recommend keeping a reasonable 8-character minimum length requirement.

Requiring the use of multiple character sets

Password complexity requirements reduce key space and cause users to act in predictable ways, doing more harm than good. Most systems enforce some level of password complexity requirements. For example, passwords need characters from all three of the following categories:

  • uppercase characters

  • lowercase characters

  • non-alphanumeric characters

Most people use similar patterns, for example, a capital letter in the first position, a symbol in the last, and a number in the last 2. Cyber criminals know this, so they run their dictionary attacks using the most common substitutions, "$" for "s", "@" for "a," "1" for "l". Forcing your users to choose a combination of upper, lower, digits, special characters has a negative effect. Some complexity requirements even prevent users from using secure and memorable passwords, and force them into coming up with less secure and less memorable passwords.

Successful Patterns

In contrast, here are some recommendations in encouraging password diversity.

Ban common passwords

The most important password requirement you should put on your users when creating passwords is to ban the use of common passwords to reduce your organization’s susceptibility to brute force password attacks. Common user passwords include, abdcefg, password, monkey.

Educate users to not re-use organization passwords anywhere else

One of the most important messages to get across to users in your organization is to not re-use their organization password anywhere else. The use of organization passwords in external websites greatly increases the likelihood that cyber criminals will compromise these passwords.

Enforce Multi-Factor Authentication registration

Make sure your users update contact and security information, like an alternate email address, phone number, or a device registered for push notifications, so they can respond to security challenges and be notified of security events. Updated contact and security information helps users verify their identity if they ever forget their password, or if someone else tries to take over their account. It also provides an out of band notification channel in the case of security events such as login attempts or changed passwords.

To learn more, see Set up multi-factor authentication.

Enable risk-based multi-factor authentication

Risk-based multi-factor authentication ensures that when our system detects suspicious activity, it can challenge the user to ensure that they are the legitimate account owner.

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