Four ways organisations can improve AI governance

Organisations with mature AI governance frameworks achieve nearly 5% higher revenue growth.

Organisations with mature artificial intelligence (AI) governance frameworks have seen a 28% rise in employees utilising AI solutions and are implementing AI across more than three areas of their operations, according to Deloitte’s report.

These businesses achieve nearly 5% higher revenue growth compared to those with less established governance.

The report also highlighted that organisations in technology, media, telecommunications, financial and insurance services, and professional services are generally better prepared for implementing trustworthy AI, whilst government, public sector, and life science and healthcare organisations face challenges in adapting swiftly and flexibly to emerging concerns related to AI technologies.

As effective AI governance is critical for organisations when integrating AI solutions into their operations and business models, Deloitte’s report highlighted four high-impact actions organisation leaders can take to improve their AI governance.

First, organisations must regularly assess and refine their AI governance framework, encompassing policies, principles, procedures, and controls. Staying updated on evolving regulations across different regions and industries is essential to maintaining leadership in AI governance standards.

Moreover, to understand and effectively manage governance needs, organisations must understand their role within the broader ‘AI supply chain’, including developers, deployers, regulators, platform providers, end users, and customers. Regular audits need to occur as well throughout the AI solution lifecycle.

Empowering employees with the skills and expertise to effectively identify, evaluate, and manage risks also enables organisations to address challenges proactively rather than simply steering clear of them. The "people and skills" dimension of the AI Governance Maturity Index often receives the lowest score amongst organisations, highlighting a critical area for improvement.

Lastly, organisations should be transparent about their long-term AI strategy, highlighting both the advantages and risks, and provide training for teams on using AI models whilst reskilling those whose roles may be affected by AI. Key initiatives include scenario planning for high-risk events, developing narratives to convey the technology's impact, and conducting crisis exercises to test readiness for potential challenges.

“Our findings reveal that organisations with robust governance frameworks are not only better equipped to manage risks but also experience greater trust in their AI outputs, increased operational efficiency, and ultimately greater value and scale,” said Dr. Elea Wurth, lead partner trustworthy AI strategy, risk & transactions of Deloitte Asia-Pacific (APAC) and Australia.

"However, our research shows that organisations are tending to overestimate their readiness in terms of AI governance," said Rob Hillard, consulting business leader of Deloitte APAC.

“Urgent action is required by senior leaders to enhance their current AI governance practices to unlock the benefits of AI, as well as being prepared for emerging AI regulations which will impact future business success.”

Nine in 10 organisations surveyed in the report are categorised as having only ‘basic’ or ‘in progress’ governance structures, indicating a significant need for improvement in AI governance practices.

The most pressing concerns associated with AI usage are security vulnerabilities (86%), surveillance (83%), and privacy issues (83%).

A quarter of organisations reported an increase in AI-related incidents, such as data breaches, over the past financial year, despite two in five lacks a system to report AI-related issues in the workplace.

Meanwhile, 45% of businesses credit improved AI governance with enhancing their reputation amongst customers. However, only 58% of employees possess the necessary skills to use AI responsibly.

Although AI solutions offer significant productivity gains, they also pose risks, including data breaches, reputational damage, regulatory fines, and business losses if not properly managed.

In 2024, the global average cost of a data breach rose by 10% to nearly US$5m, with costs for large organisations being even higher.

Investment in AI is projected to increase fivefold by 2030, reaching US$117b in the APAC region alone.