As artificial intelligence (AI) becomes increasingly integrated into daily operations, businesses are facing new legal and ethical considerations. Whether you’re using AI to streamline marketing, generate content or automate processes, it’s crucial to ensure transparency in how AI is used, especially when it comes to building trust, complying with legal obligations, and protecting your business.
In this article, I’ll walk you through why it’s important to be open about AI use and share tips on how to mitigate the risks it can bring.
1. Trust and authenticity matter more than ever
Imagine a scenario where a customer comes across your social media post, ad, or website and believes it’s been created by a person. Later, they discover it was AI-generated. They might feel misled, even if the content itself was accurate and engaging.
Consumers today place a premium on authenticity, and with the rise of AI-generated content, trust can easily be undermined. By being upfront about your use of AI, you can maintain that trust and build stronger, more genuine relationships with your audience (and your team!).
2. Intellectual property concerns: Who owns AI-generated content?
One major legal concern with AI-generated content is intellectual property (IP). AI tools often use large datasets to create new content, and these datasets can include copyrighted works. This raises the question: Who owns the rights to the AI-generated material?
Without careful consideration, you could unintentionally infringe on someone else’s IP rights, resulting in legal and financial consequences. Additionally, some AI platforms retain ownership of the content they generate, while others grant licenses. It’s crucial to know where you stand legally before using AI-generated materials in your business.
3. Cultural and emotional nuances: The importance of human oversight
While AI is great at producing efficient and cost-effective content, it often lacks the cultural awareness and emotional sensitivity that human creators bring. For businesses that serve diverse audiences, AI-generated images or text can miss the mark, leading to inappropriate or insensitive messaging.
Without human oversight, you risk creating content that doesn’t resonate—or worse, offends—your target audience. AI currently lacks the depth of understanding that humans have, making it essential to involve people in the review process.
4. Ethics and transparency: Building long-term consumer confidence
Ethical considerations in AI use are becoming a critical issue for businesses. Not disclosing AI-generated content could lead to questions about transparency, which could harm your brand’s reputation and even result in legal challenges. As regulators and consumers become more aware of AI’s role in content creation, failing to disclose it could create a perception of dishonesty.
Imagine running a campaign with AI-generated visuals and not making this clear. This could backfire if consumers feel misled or deceived especially with the rise of AI deep fakes.
The new EU AI Act has introduced quite stringent transparency requirements for businesses deploying large language models within the EU…it’s only a matter of time before we could see something similar here in the UK. Staying transparent is recommended to avoid public backlash or legal scrutiny.
5. Be careful with inputs: Protect confidentiality and privacy
When feeding information into AI systems, it’s important to think about data privacy and confidentiality. AI models often require large amounts of data to function effectively, but if the inputs include sensitive or confidential information, you may be exposing your business to unnecessary risks. Additionally, if personal data or confidential information is used as an input, you could be breaching data protection legislation or a contractual obligation for confidentiality.
6. Don’t rely solely on AI outputs: Fact-check and be aware of hallucinations and bias
AI can be powerful, but it’s not infallible much like humans have their off days. AI-generated content is only as good as the data it’s trained on, and sometimes that data can be incomplete, outdated, inaccurate or biased. Relying too heavily on AI-generated outputs without human review could lead to mistakes, misrepresentations, or biased content that could harm your brand….even lawyers have fallen foul of this recently!
7. Check your contracts: Understand the limits of AI use
When using AI tools, it’s essential to carefully review your contracts to understand any limitations on how you can use the AI-generated content. Some AI platforms may restrict the scope of how and where you can use their generated content, which could limit your marketing or business strategies. Does your client have restrictions in their terms and conditions on the use of AI when providing your services?
8. Check your liability and protection
AI use can introduce new risks to your business, from intellectual property disputes to issues with data privacy and breach of contract. It’s important to review your liability risks with your insurer to make sure you’re covered for these emerging risks.
Conclusion: Transparency and AI – A balanced approach
AI offers incredible benefits, but it also presents new challenges. By being transparent about your AI use and training your team on the risks and the company’s policy on AI, you can protect your brand’s reputation, comply with legal obligations and avoid potential faux pas with your customers and colleagues.
As a business that embraces the potential of AI, we’ve used it to help support the writing of this article. AI has a valuable role to play in enhancing efficiency and creativity, but like any tool, it should be used with caution. By combining AI’s capabilities with human oversight, we ensure accuracy alongside ethical standards.
If you have any questions about how to use AI responsibly in your business or need legal advice on intellectual property, data protection and contract management, feel free to reach out. We’re here to help.
Ryan has helped a vast number of businesses protect and control their intellectual property as well as drafting and advising on consumer and commercial contracts.
