In April 2023, Samsung engineers copied internal source code and confidential information into ChatGPT while trying to solve technical problems. There was no malicious intent. Employees were simply using a tool that promised to make their jobs easier. The result was a significant data governance issue and a clear reminder that AI can introduce risk just as quickly as it creates value. It’s a scenario that organisations across every sector should pay attention to.
Artificial intelligence is already embedded in day-to-day business operations. Staff are using it to draft documents, analyse information, summarise meetings and support decision-making. In many organisations, AI adoption is happening far faster than the controls designed to manage it. That is where AI governance becomes essential.
What Is AI Governance?
AI governance is the framework that helps organisations use artificial intelligence safely, responsibly and effectively. It combines policy, oversight and operational controls to ensure AI systems align with business objectives, security requirements and legal obligations. Rather than creating entirely new governance structures, many organisations can build upon existing cyber security, information governance and risk management processes.
At its core, AI governance focuses on three key areas:
- Visibility – understanding where AI is being used.
- Control – managing the risks associated with its use.
- Accountability – ensuring clear ownership and oversight.
Without these foundations, organisations can quickly find themselves exposed to unnecessary risk.
As David Moffatt, Technical Director at Evolve North, explains:
“AI isn’t the risk in most situations. Using AI without governance is. The organisations that succeed will be the ones that understand where AI is being used, who is responsible for it, and what controls are in place to manage the risks.”
Why Policy Matters
Every successful governance programme starts with clear expectations. An AI usage policy should outline what is acceptable, what is prohibited and where additional approval may be required. It should answer practical questions such as:
- Can employees use public AI tools?
- What types of information can be shared?
- Who approves new AI solutions?
- What checks are required before deployment?
The challenge is finding the right balance. Blanket bans rarely succeed because employees will often find ways to use tools that improve productivity. A more practical approach is to provide approved solutions, establish clear guardrails and give employees guidance on safe and appropriate use.
The Samsung incident demonstrates why this matters. A simple restriction preventing confidential information from being entered into public AI systems could have significantly reduced the risk.
You Can’t Govern What You Can’t See
One of the biggest challenges organisations face is understanding how much AI is already being used. Some AI systems are formally implemented and centrally managed. Others appear organically as employees adopt tools to solve everyday business challenges. This growing trend, often referred to as “shadow AI”, can introduce risks that aren’t captured by existing governance processes. Before organisations can govern AI effectively, they need visibility. Maintaining an inventory of AI tools and use cases helps establish where AI is supporting business processes and where potential risks may exist. Once identified, systems can be assessed according to their level of risk. Not every AI application requires the same level of oversight. A tool used to summarise meeting notes presents a very different risk profile from a system supporting recruitment, fraud detection or financial decision-making. Applying governance proportionately allows organisations to focus effort where it matters most.
AI Governance Shouldn’t Stand Alone
A common mistake is treating AI as something separate from existing governance frameworks.
In reality, many of the controls organisations already use remain highly relevant. Data protection requirements still apply when AI systems process personal information. Security controls such as access management, monitoring and resilience testing should extend to AI platforms. Supplier assurance processes should also consider how third-party AI providers manage data, train models and secure their services. The organisations making the most progress are not building entirely new frameworks. Instead, they are adapting existing governance, security and risk management processes to address AI-specific considerations. This approach improves consistency and reduces duplication.
Why Leadership Matters
AI governance is ultimately a leadership responsibility. Someone within the organisation must be accountable for overseeing AI use. Depending on the structure of the business, this responsibility may sit with a CIO, CISO, DPO or a cross-functional governance group. What matters is that ownership is clearly defined.
Boards and leadership teams should also have visibility of:
- Where AI is being used.
- The risks associated with those systems.
- The controls in place to manage those risks.
- Any incidents, compliance requirements or emerging concerns.
As AI becomes more embedded in business operations, governance is increasingly becoming a strategic business issue rather than purely a technical one.
Governance Enables Innovation
There is sometimes a perception that governance slows innovation. In reality, effective governance enables it.
Clear policies, defined processes and effective oversight give organisations the confidence to adopt new technologies safely and at scale. Employees understand the boundaries, leaders understand the risks and the business can take advantage of AI without creating unnecessary exposure. The organisations that succeed over the coming years will not necessarily be those using the most. They will be the organisations that understand how AI is being used, where the risks exist and what controls are in place to manage them.
How We Can Help
At Evolve North, we help organisations develop practical AI governance frameworks that enable innovation while reducing risk. Whether you’re creating an AI usage policy, assessing existing AI deployments, integrating AI into risk management processes or preparing for emerging regulatory requirements, we can help you build the visibility, controls and oversight needed to use AI with confidence.
If you’d like to understand how AI is being used across your organisation and whether the right governance controls are in place, contact us at info@evolvenorth.com or call 01748 905 002.