Although Artificial Intelligence’s (AI) full potential to reshape industries is still emerging, manufacturers are steadily discovering new ways to integrate it into daily operations. But as this evolution continues, regulation is becoming essential to mitigate risks and drive development.

AI has the potential to transform industries across the economy, driving new efficiencies, products, and services. Yet alongside these opportunities come serious challenges, from the risk of widening social and economic inequalities to growing concerns about privacy and data protection. Experience has shown that clear, well-designed regulations don’t always hold back innovation. In fact, they can encourage it by providing businesses with certainty and attracting investment. In early 2023, the UK demonstrated a pro-innovation approach to AI regulation with the publication of a white paper where it proposes that existing regulators, including the UK Information Commissioner’s Office, take responsibility for the establishment, promotion, and oversight of responsible AI in their respective sectors with aim to balance fostering AI innovation with addressing ethical risks. Companies that take the initiative to define strong, transparent standards not only help shape the responsible use of AI but also position themselves as leaders in emerging technologies, gaining a valuable competitive advantage.

Recent developments regarding whether U.S. states have the authority or lack the authority to regulate artificial intelligence have reignited discussions about the need for companies to take the lead in establishing their own AI guidelines. A Republican-backed bill aiming to block states from enforcing AI regulations reflects a broader trend in government: prioritizing AI innovation over regulation. While more than 100 AI-related bills were introduced in the last Congress, very few were enacted. This federal inaction has prompted several states to step in, with Colorado, California, and Connecticut passing their own AI-related legislation.

While efforts towards regulation have been made, evolutions across states and even countries are fragmented, resulting in an increasingly complex global regulatory landscape. To stay ahead of such divergences, businesses must establish their own regulations regarding AI and consistently educate their teams on the correct and safe usage, as well as stay up to date with changing legislation. With the race to modernize operations and keep up with competitors intensifying, it’s easy for businesses to skip past establishing the proper governance for their new technology, potentially compromising operational efficiency. 

The everyday implications of AI

With conversations no longer centered on what AI can do, but rather on how much it can do, its applications are truly endless, and its adoption rate reflects this notion, with 90% of manufacturers utilizing some form of AI in their operations. With today’s economic climate driving an urgent need for manufacturers to do more with less, they are reframing what Enterprise Resource Management (ERM) means to them in the face of AI’s computing power. Notably, a level of “imposter syndrome” is associated with using AI processes, with 38% reporting they feel behind their peers in implementation, indicating a culture of dissonance between AI’s capabilities and a business’s employment of it.

To mitigate these feelings and properly utilize AI to its full capabilities, businesses need to begin implementing conversations and regulations surrounding its implications, especially as new standards emerge in the wake of AI’s widespread adoption. Currently, AI poses a threat to job security as job processes become increasingly streamlined. Goldman Sachs estimated that 300 million full-time jobs could be lost due to AI automation, altering work cultures and employment, threatening company morale, and ultimately, efficiency. In addition, many AI algorithms have been later discovered to have some form of discriminatory bias, meaning that an overreliance on work produced by AI could put companies at serious risk.

Establishing best practices for AI use

Ultimately meant to speed up work processes and increase efficiency, if not monitored and properly utilized, AI can work against a company, creating issues surrounding accountability, transparency, and legitimacy. Generative AI systems are directly trained on sets of data, meaning they are only as good as the data on which they are trained. Additionally, frequent allegations of stolen work and plagiarism are being made. AI is wildly not subjected to the same fact-checking processes as traditional research methods, and its outputs can require more scrutiny to ensure data privacy and integrity, as well as adhere to fairness, bias, and regulatory requirements.   

Tailored compliance training to keep AI processes aligned with equitable guidelines is a crucial starting point for building a culture of respect and understanding in the responsible use of AI. In addition, rigorous third-party due diligence and setting clear benchmarks help organizations embed ethical values consistently, creating a strong foundation for equitable innovation with emerging technologies. According to the LRN 2025 Ethics & Compliance Program Effectiveness Report, there is a significant gap in how organizations approach these efforts. Programs categorized as high-impact (those that actively foster an ethical culture, promote values-based decision-making, and ensure accountability at all levels) are far more likely to adopt compliance measures for emerging risks like AI and supply chain vulnerabilities. In contrast, medium-impact programs (those with a more limited or inconsistent focus on ethical culture) lag behind by as much as 2.3 times in adopting these critical safeguards. This gap highlights the importance of proactive efforts to strengthen compliance programs, not only to reduce risk but also to position organizations as leaders in ethical and responsible innovation.

Futureproofing through compliance

AI is poised to continue shaping the future of virtually every industry, despite regulations and limitations that are yet to be defined. Businesses are left to their own devices to operate under an increasingly complex tapestry of compliance. Through diligent education and awareness of this evolving landscape, businesses and their partners can thrive by using emerging technologies and position themselves competitively. Together, companies can help create a code of conduct surrounding emerging technologies that ensures prosperity into the future.