The rapid advancement of generative artificial intelligence technologies has revolutionized various industries by automating complex tasks, creating content, and enhancing decision-making processes. However, it also poses significant business risks and ethical dilemmas. Because this technology is so easy to use and exploding in capabilities, it is crucial that companies establish a comprehensive GenAI policy.

Importance of Adopting a GenAI Policy

There are many reasons organizations should adopt a GenAI policy. Some open platforms can subject companies to the loss of trade secrets or confidential data. Others can expose an organization to cybersecurity risks. A policy can help prevent many unintended potential ethical, legal, quality, and security issues and inform employees about which uses are permitted.

Ethical, Compliance, and Legal Considerations 

A well-defined policy ensures that AI-generated content aligns with the company’s ethical standards and societal values. Employees need to know whether the large language models have been trained on data that may result in misleading, biased, or offensive answers. For example, basing hiring decisions on GenAI alone can lead to biased outcomes, potentially subjecting the company to discrimination claims.

A GenAI policy helps mitigate legal risks by setting clear guidelines for AI use. Management should stay current on all new regulations and industry guidelines governing AI products. Companies doing business internationally should be aware that the United Kingdom, Australia, Canada, the European Union, and others are developing regulations or frameworks that govern the use of AI. The emphasis will be on ensuring AI is used in a way that is safe, transparent, and respectful of individual rights.

Quality Control

AI-generated content might lack the quality and accuracy of human-produced work. An AI policy ensures that mechanisms are in place to review and verify the output, thus maintaining the company’s reputation for high-quality products and services. Every byproduct resulting from the use of AI should be reviewed for accuracy.

Security and Privacy 

A policy should outline measures to protect data privacy and secure AI systems from cyber threats. Many free AI products train their large language model computers to evolve with every use, so information used in prompts is not private.

Key Components of a GenAI Policy

The essential components of any AI policy will state its overall objectives and scope while addressing the following:

• Purpose and scope: Define the policy objectives and the scope of its application within the company. Specify which departments and processes the policy covers. State whether the policy covers every employee.
• Ethical guidelines: Establish ethical standards for AI usage, including fairness, transparency, and accountability. Include provisions to prevent bias and ensure inclusivity in AI-generated content. If industry ethical standards regulate the use of your data, place a link to the standards in your policy.
• Compliance and legal requirements: Detail the legal standards and regulations the company and its employees must adhere to. As many federal agencies are issuing AI best practices, you should incorporate them into your policy if they impact your business activities. Outlining procedures for staying updated with changing US and international laws and ensuring compliance is essential. 
• Quality assurance: Implement review processes for AI-generated content. Specify criteria for accuracy, reliability, and relevance, and assign responsibilities for quality control. Identify key personnel your employees should contact if they have any questions about the policy.
• Data privacy and security: Define protocols for safeguarding data and securing AI systems. Include guidelines for data handling, storage, and access controls. Identify key personnel who should be notified should there be a breach.

The Secrets of Implementation 

The secrets to an effective implementation include engaging stakeholders, communicating with employees, and evaluating AI policy usage.

• Stakeholder engagement: Involve key stakeholders from various departments when developing the policy. Form an AI task force and involve department heads to get buy-in for smooth implementation.
• Clear communication: Communicate the policy clearly and consistently across the organization. Use multiple channels to ensure all employees are aware of the policy and its importance. Employees must understand proper and improper AI uses. 
• Monitoring and evaluation: Establish mechanisms for monitoring AI usage and evaluating the policy’s effectiveness. Regular audits and feedback loops can help identify areas for improvement.
• Continuous improvement: As AI technologies and regulatory landscapes are continually evolving, update the policy regularly to reflect new developments and emerging best practices.
• Essential Tips for Sustained Success: An AI policy does not end with implementation. A company must continuously monitor and update the policy to ensure its relevance and effectiveness. 
• Be transparent: Always disclose when content is AI-generated. Ensure users understand the role of AI in creating or modifying content.
• Audit outputs for bias: Be vigilant about potential biases in AI-generated outputs. Regularly review and audit AI systems to ensure they produce fair and unbiased results.
• Ensure confidentiality: Handle sensitive information with care. Follow data privacy protocols to prevent unauthorized access or leaks of confidential data. Coordinate AI usage and compliance with the company’s cybersecurity team.
• Be ethical: Use AI tools responsibly and ethically. Do not use AI to create misleading, harmful, or offensive content.
• Be accountable: Take responsibility for AI-generated content. Be prepared to address any issues or concerns that arise from its use.

The time for a well-crafted GenAI policy is now. It is essential for companies to harness the benefits of AI while mitigating its risks. By defining clear guidelines, ensuring compliance, and promoting ethical AI usage, companies can foster a responsible and innovative AI-driven environment.

This article was originally published by Today’s General Counsel on October 11, 2024 and is republished here with permission from the publication.