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A written document that defines how an organization's employees may and may not use AI tools. An effective AI policy specifies: which tools are approved, which are prohibited, what data each tool can access, where human review is required before acting on AI output, and what to do when something goes wrong. AI policies exist at two levels: organizational (internal rules for a company) and governmental (laws and regulations set by governments). Most governance discussions for small teams focus on organizational AI policy — the internal document that governs day-to-day AI use.
Why this matters for your team
Every team using AI tools needs a written AI policy, even if it's one page. Without one, employees have no guidance on what data is safe to use with AI, and you have no evidence of good-faith compliance if a regulator or customer asks.
A startup writes a one-page AI policy specifying that ChatGPT may be used for internal drafts but not for external client communications, and that no customer data may be pasted into any AI tool not covered by a signed DPA.