Executives who are skeptical about the importance of AI governance should think back to a lesson from our recent past. When executives started paying closer attention to making progress on ESG issues, they were surprised by the results. The companies that perform better on ESG also perform better financially. However, this correlation has little to do with ESG itself. Rather, to make progress on ESG, companies must develop the muscles for gathering data, analyzing risk, and parsing trends. Once developed, those muscles can be applied to myriad other parts of the organization. The result is better numbers across the board.

Many organizations opted for a voluntary ESG disclosure framework rather than waiting to be hit with regulatory penalties. Executives recognized that transparency could be a competitive advantage and that if they weren’t facing pressure from stakeholders at the time, they soon would be.

Even though governments are taking AI governance seriously, companies may find that it’s in their best interest to be proactive. Fortunately, if they’re already thinking about data governance, then they can apply many of those principles to AI governance as well. Conversely, AI governance best practices will improve overall data governance and reporting across your entire organization. It’s good for business.