AI’s rapid adoption has left many organizations uncertain about how to manage potential risks. Concerns over legal liability, data privacy, ethical considerations, and regulatory compliance have made some companies hesitant to embrace AI, particularly in areas like human resources and accounting.
A recent survey made up of 330 executives across the US revealed that more than half of organizations don’t currently have AI policies in place to mitigate risk. Many organizations that do have policies in place are missing some key components that make them effective.
In the same study, executives cited reasons why their organization has not established policies. Here are the three most common:
Organizations need policies that are more comprehensive, actionable, and effective as AI becomes more pervasive.
One of the most significant gaps in AI policy implementation is the lack of comprehensive employee training. Even the most well-crafted policies are ineffective if employees don’t understand or know how to apply them.
Setting basic expectations at the start isn’t enough. Training programs should go beyond basic awareness to include:
Investing in training not only mitigates risks but also empowers employees to use AI tools effectively. Training should be a continuous process along with audits and reviews of work processes where AI is involved.
A challenge in AI adoption is the lack of executive alignment. Misaligned perceptions of AI’s use and risks can result in fragmented policies that fail to address critical vulnerabilities.
To create cohesive and effective AI policies, organizations should:
When leadership is aligned, policies are more likely to be effective and embraced across the organization.
US and international laws create a complex compliance environment, especially with AI in its formative years. For example, the European Union’s AI Act and state laws in New York and Colorado impose stringent requirements on AI use.
To navigate these challenges effectively, organizations must stay informed. Organizations must monitor legal developments and adapt policies as regulations emerge. Risk assessments are also important for evaluating how AI tools are used, particularly in areas like finance where accurate reporting is vital. Many organizations in the study mentioned earlier reported concerns with litigation risk. Engaging legal experts may be helpful.
AI is a game-changer for many organizations looking to improve processes, reduce manual work, and make teams more efficient and effective. With comprehensive and aligned policies, organizations can mitigate risk while unlocking AI’s potential. The key lies in viewing AI not as a liability but as an opportunity—one that requires careful planning, collaboration, and a forward-thinking approach to governance.
At Trenegy, we help organizations leverage AI realistically and develop processes, policies, and procedures that align with business goals. For more information, reach out to us at info@trenegy.com.
