AI Strategy
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Tim Hillegonds
How to Create an AI Policy
An AI Council sets direction, but an AI Policy provides the guardrails. By defining how AI is used ethically, transparently, and strategically, leaders can ensure every initiative aligns with business goals and organizational values.
Once you’ve appointed your AI Council, the second step in building effective AI governance is to draft an AI Policy.
Your AI Policy acts as a set of foundational guidelines, ensuring all AI initiatives are implemented ethically, transparently, and in alignment with your organization’s goals. Without it, you risk falling into what I call “Random Acts of AI Adoption”—scattered pilots that burn resources but don’t drive measurable value.
Whether you’re a large enterprise navigating legal and compliance complexities or a smaller organization just getting started, the goal is the same: clarity. Your policy should reflect your organizational objectives and scale appropriately to your size, industry, and risk profile.
The Simple AI Policy Framework
Below are 22 items to consider including in your AI Policy. Your list may be longer or shorter, but these are the core elements that create a solid foundation.
Purpose – Establishes the guidelines and best practices for the responsible, ethical use of AI.
Scope – Defines who the policy applies to (employees, contractors, partners).
Responsible AI Use – Requires actions that avoid harm, respect privacy, and ensure compliance.
Compliance with Laws & Regulations – Aligns use with data protection, privacy, and IP laws.
Transparency – Requires disclosure when AI is used in content or decision-making.
Tool Selection – Lists approved AI tools; prohibits unapproved tools without authorization.
Accountability – Clarifies that humans remain responsible for AI outputs.
Restricted Use Cases – Defines areas where AI must not be used (e.g., sensitive legal docs).
Addressing Bias – Requires review of AI-generated content for fairness and inclusivity.
Privacy – Protects customer data and IP, limiting use to approved tools with strong policies.
Security – Ensures AI tools meet security standards to prevent data breaches.
Ethical Considerations – Prohibits misuse (impersonation, manipulation, copyright violation).
Employee Training – Mandates ongoing training on AI’s technical and ethical use.
Human–AI Collaboration – Reinforces human oversight and decision-making.
Third-Party Services – Requires external AI providers to adhere to organizational standards.
Implementation & Monitoring – Assigns an AI Lead or Council to oversee compliance.
Periodic Reviews – Calls for regular updates to the policy.
Incident Reporting – Provides a system for reporting violations or concerns.
Enforcement – Outlines disciplinary measures for non-compliance.
Policy Review – Requires annual review or revision as needed.
Effective Date – States when the policy goes into effect.
Acceptance – Requires employees to acknowledge and agree to comply.
Continue the AI Journey
Implementing an AI Policy is the foundation for responsible and effective AI adoption. By defining clear guidelines for transparency, ethics, governance, and accountability, you ensure that every AI initiative aligns with organizational values and business objectives.
And remember: an AI Policy is not a static document. It should evolve with your AI strategy, your market, and the regulatory environment. Regular reviews and updates keep it relevant and actionable.
To put it all together, your AI Council is the governing body, your AI Charter is the purpose, and your AI Policy is the playbook. Together, they turn AI adoption from experimentation into strategy.
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