Why SA businesses should prepare now for the AI Royal Commission
Many organisations still view artificial intelligence as a technology issue. In reality, it has become a governance and risk issue, writes Piper Alderman partners Tom Griffith and Travis Shueard.
When Premier Peter Malinauskas announced South Australia’s Royal Commission into Artificial Intelligence, much of the discussion focused on the future of technology, regulation and public policy.
That is understandable. Artificial intelligence is transforming the way we work, learn, communicate and do business. The Royal Commission is expected to examine the opportunities and challenges AI presents for South Australia, including its impact on education, public services, workforce participation and critical infrastructure.
But for many South Australian organisations, there is a more immediate question:
What should businesses be doing now?
The answer is simple: taking action.
AI has moved into the boardroom
Many organisations still view artificial intelligence as a technology issue. In reality, it has become a governance and risk issue, an integration issue and, increasingly, a leadership issue.
Across South Australia, businesses are already using AI to improve productivity, automate routine tasks, analyse information, support customer interactions and enhance decision-making. In many cases, adoption has happened quickly, with teams embracing new tools before governance frameworks have fully caught up.
That is not necessarily a problem. Innovation always moves faster than regulation.
In other cases, the use of AI is customer or client driven. The increasing public use of AI has already led to higher customer and client expectations of business, and the more efficient delivery of products and services. Clients want to know where the AI-driven savings and efficiencies will be. That is also a net positive development.
The challenge is ensuring organisations understand where and how AI is being used, who is accountable for it and what guardrails exist around its use. These are precisely the kinds of problems the Royal Commission is likely to explore.
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One of the lessons from previous Royal Commissions and major public inquiries is that scrutiny rarely focuses solely on the technology, system or event under examination.
Instead, attention often turns to governance.
Decision-makers are asked:
- What did you know?
- When did you know it?
- Who was responsible?
- What policies were in place?
- How were risks identified and managed?
These same questions are likely to emerge in discussions about AI.
An organisation does not need to be a technology company to be affected. Businesses across every sector are increasingly using AI-enabled systems. Boards and executives should therefore consider whether they could confidently explain how AI is being used within their organisation and how associated risks are being managed.
Five questions every organisation should be asking
While the final Terms of Reference are still being developed, there are several practical questions organisations can ask now:
1. Do we know where AI is being used?
Many organisations underestimate the extent of AI adoption within their workforce. AI is already embedded within commonly used software platforms, customer service tools, recruitment systems, data analytics products and workplace productivity applications.
The first step is understanding where and how these technologies are being used.
2. Who is accountable?
Most organisations have clear ownership of financial risk, workplace safety and cybersecurity. However, AI governance is often less clearly defined.
Boards and executive teams should consider who is responsible for oversight, risk management and decision-making relating to AI use. Is AI being used to create board papers? If so, what safeguards are in place to make sure those documents are fit for purpose? In circumstances where board papers can be voluminous and provided at short notice, under what circumstances and on what terms should directors be permitted to harness AI to assist them?
3. Are our policies fit for purpose?
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This technology is moving fast. Policies developed even 12 months ago may no longer reflect current technology or organisational practices.
Organisations should review how their policies address issues such as privacy, confidentiality, intellectual property, data use, employee use of AI tools and verification of AI-generated outputs.
4. Could future regulation affect us?
The Royal Commission is expected to consider regulatory and policy settings.
Businesses should think about how future regulation might affect their operations, customers, workforce and competitive position.
5. Do we have a voice in the discussion?
One of the opportunities presented by the Royal Commission is the ability for industry to contribute to the policy conversation.
Many South Australian businesses have practical experience implementing AI responsibly and effectively. That experience can help inform a regulatory framework that balances innovation with appropriate safeguards.
This is an economic opportunity
It would be easy to view the Royal Commission solely through the lens of risk and regulation. That is not the whole picture.
Artificial intelligence has the potential to improve productivity, support economic growth, enhance public services and create new opportunities for South Australian businesses. The challenge is ensuring those benefits are realised in a way that maintains community trust and confidence. Businesses have an important role to play in that conversation.
Organisations that engage early, strengthen their governance arrangements and understand their AI footprint will be better placed not only to respond to scrutiny but also to capitalise on the opportunities that AI presents.
Prepare now
The Royal Commission is expected to commence in October. That may sound like plenty of time, but experience suggests that organisations are best served by preparing before they are asked to provide information, explain decisions or contribute to public discussions.
Preparation does not mean anticipating criticism. It means understanding your systems, your governance framework and your approach to managing emerging risks.
Regardless of the recommendations that ultimately emerge, it is already clear that artificial intelligence is no longer simply a technology issue, it is now firmly a business issue.
About the Authors
Tom Griffith is a Partner at Piper Alderman and an experienced disputes and investigations lawyer. He advises organisations, boards and executives on Royal Commissions, commissions of inquiry, regulatory investigations, governance issues and complex disputes. Tom has extensive experience helping clients prepare for and respond to high-profile investigations and public scrutiny.
Travis Shueard is a Partner at Piper Alderman specialising in technology, intellectual property and the defence sector. He advises organisations on the legal, commercial and governance implications of artificial intelligence, data use, digital transformation and innovation, and assists clients to navigate the opportunities and risks associated with AI adoption.
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