What is AI Governance?
AI governance encompasses the frameworks, policies and processes that organisations establish to ensure artificial intelligence is deployed responsibly, ethically and in compliance with regulatory requirements. In financial services, AI governance addresses model risk management, bias testing, explainability, data protection, human oversight and accountability structures. Effective governance ensures AI systems operate transparently, remain aligned with business objectives and regulatory expectations, and can be audited throughout their lifecycle.
AI Governance in financial services
For UK financial services firms, AI governance sits alongside existing obligations rather than replacing them. Model risk, data protection, fair treatment of customers and individual accountability all continue to apply, so a governance framework needs to show how each AI system is tested, monitored and owned by a named person.