Data Privacy and Reputation Concerns About Adopting AI

Reputational damage was the greatest source of concern about AI, followed by damage such as data privacy violations, regulatory penalties, financial damage, and employee dissatisfaction, according to a ZDNet article. Several lawsuits have already been filed due to privacy violations, copyright infringement, and other issues related to the unethical use of AI.

A survey conducted by Deloitte indicates that 74 percent of companies surveyed have begun testing generative AI, with 65 percent using it internally.

A critical finding: 56 percent of respondents stated their companies are unsure about having ethical principles guiding the use of generative AI.

However, the report highlights the increasing ethical concerns associated with the widespread adoption of AI. These include data privacy (22 percent), transparency in AI training (14 percent), data poisoning (12 percent), and intellectual property and copyright issues (12 percent).

Reputational damage is the most significant concern (38 percent), followed by damage to persons, regulatory penalties, financial damage, and employee dissatisfaction.

To address these challenges, Deloitte proposes a multi-step approach:

Governance: Creating standards and protocols for AI use could minimize harmful impacts, so companies should determine what types of ethical principles they plan to uphold.

Exploration: Encourage product owners and business leaders to explore generative AI through workshops to assess its value for their businesses.

Foundational: Companies can either buy or build AI platforms to implement generative AI into their businesses. Thirty percent of respondents’ companies chose to use existing capabilities with major AI platforms. Eight percent created their own in-house AI platforms. Five percent chose not to use generative AI.

Pilots: Run experiments on various use cases to test proof of concepts, and run pilot programs. Eliminate aspects deemed too risky.

Implementation: Draft a plan for introducing AI-enhanced products into the market. Ensure transparency in explaining how user data is inputted, the model’s output process, and the likelihood of model hallucination.

Audit: Modify policies based on AI risks, acknowledging that approaches may vary among companies.

Deloitte emphasizes the importance of early collaboration among companies to identify risks and establish governance, contributing to stakeholder value, brand elevation, and market creation.