Key Points:

1. AI governance is essential because it ensures organizations maintain transparency, accountability, and oversight over how AI systems are trained, deployed, and used
   

2. Leaders must proactively assess where AI models source their data, ensuring compliance with intellectual property laws and mitigating risks related to unauthorized content use
   

3. We don’t govern AI to avoid lawsuits. We govern AI to demonstrate that we are in control. This is how we build trust with stakeholders
   

In my 20s, I spent a lot of time traveling to Germany to visit a close friend. He had an early GPS unit in his car. It was an outdated system that relied on CDs for updates and generated very blurry little arrows on a tiny screen nowhere near the driver's eyes. On one trip, we thought we were heading west of Frankfurt to a favourite restaurant. Instead, we ended up 75 kilometers south. We found ourselves sitting in his car at a dead end, with his high beams on, staring into a dark farmer's field. The system led us astray because we over-relied on old data inside a brand-new consumer technology.

When I speak with leaders adopting AI for the first time, I often think of getting lost in the rural German countryside. AI, like early GPS, promises efficiency, but its reliability depends entirely on its data. Organizations are under pressure to adopt AI to streamline operations, reduce costs, and drive creativity. But AI isn’t a magic bullet. It’s a tool. And like an unreliable GPS, AI trained on flawed or unauthorized data can take your organization in the wrong direction. It relinquishes control.

Cohere, a major AI company in Canada, is facing a significant lawsuit over how it trained its models; Cohere used copyrighted content without permission or providing compensation. This case is one you should know about because it's more than just a legal battle. It’s a reminder: AI adoption isn’t just about capability. It’s about building and maintaining responsible control. So, how exactly do you ensure you are in control? The answer begins and ends with an ethical strategy.

The Ethical Fault Line

The lawsuit against Cohere, a Toronto-based AI company, highlights the growing tension between AI developers and content creators. Major media organizations allege that AI companies are scraping and reproducing their content without consent or compensation. This raises a critical question: Who controls knowledge in the era of AI?

This isn’t just a tech industry issue—it’s a governance challenge with real consequences. AI systems generate content, provide insights, and automate decisions based on their underlying data. If that data is sourced irresponsibly—such as using newspaper articles without publisher consent—organizations risk reputational harm, legal liability, and a breakdown of trust with employees, customers, and industry partners.

Lessons for AI Leaders: How to Stay on the Right Side of AI Ethics

As AI continues to reshape industries, its impact will depend on how it is developed and deployed. Business leaders don’t need to be AI engineers, but they do need to ensure that they are using AI transparently. Here's why:

• Transparency is the Foundation of Trust. AI should not be a "black box"—a technology that operates mysteriously without clear explanation. Leaders need visibility into how AI works, what data it uses, and what safeguards are in place. This means two things: first, working with AI vendors to receive clear documentation on data sources and model behaviour. If a company can’t explain how its AI makes decisions, that’s a red flag. Second, leaders need a communication strategy—something that they can reference to explain AI’s role to any stakeholder

  
  

• Respect Intellectual Property from the Start. Whether using AI to generate content, analyze trends, or assist in decision-making, stakeholders expect AI leaders to account for where AI data comes from. If an organization uses internal data from sales reports, for example, this needs to be documented. If outsourcing data from a third-party vendor, it’s not enough to say that the data is external—leaders must be able to confirm the vendor’s ownership and rights to that data

  
  

• Governing AI Is Not Optional. Responsible AI use requires a governance framework. Companies need clear policies that define how AI is trained, where data comes from, and how the system and its outputs are monitored. Think of AI governance like driving a car: just as drivers follow traffic laws and speed limits, AI systems require rules to ensure safe and ethical operation. AI governance is a business strategy that demonstrates commitment to legal, compliant, and ethical AI development—ensuring transparency, explainability, and accountability.

  
  

Ethical AI is an Advantage. Not a Financial Burden

Much like the way a driver is expected to maintain control of their vehicle, to abide by rules, and to ensure their own and others' safety, drivers build trust with their passengers and other drivers by continuously demonstrating that they are in control. The same holds true with AI ethics. We don't govern AI to avoid lawsuits. We govern AI to demonstrate that we are in control.