AI Governance

AI governance is the set of decision rights, review processes, and accountability structures that determine how an organization builds, procures, and deploys AI systems — and who is responsible when one of them fails. It sits one level above risk management: risk management identifies and mitigates specific risks in a specific system, while governance determines who has the authority to decide a risk is acceptable in the first place.

What it isn't

A governance framework is not the same thing as an AI ethics statement, and it's not the same thing as a model risk management process borrowed wholesale from financial services. Ethics statements describe intent; governance describes enforceable structure — who reviews what, before what point, with what authority to stop a deployment. A framework that can't name who has the authority to say no to a specific system isn't a governance framework yet, whatever the deck calls it.

The core components

A working governance program generally includes, at minimum:

• A current inventory of AI systems in use, including shadow AI adopted outside formal procurement
• A risk-tiering method that sorts systems by the consequence of failure, not by the underlying technology
• Named, accountable owners for consequential systems — not committees
• A review gate placed early enough in the deployment process to actually change the outcome
• A process for updating the framework itself as regulation and internal risk tolerance change

Our governance framework checklist walks through building each of these in the order that tends to hold up in practice.

Why it's distinct from compliance

Compliance asks "does this satisfy the law." Governance asks "who decided this was acceptable, and on what basis" — a broader question that holds up even in jurisdictions with no AI-specific statute yet. A company operating only in a state with no AI law on the books still has employment-discrimination, consumer-protection, and tort exposure from a poorly governed AI system; governance is the structure that manages that exposure regardless of which specific statute eventually applies.