Strategic EU AI Act compliance for legal security and competitive advantage

Why the EU AI Act is right on time for global AI governance

Understanding the European AI Regulation (AI-VO) and its strategic implications for businesses is increasingly essential. On July 21, 2024, the EU published the AI-VO in the Official Journal of the European Union, marking it as the first comprehensive regulation of AI on a global scale. This regulation brings legal requirements and strict guidelines aimed at ensuring compliance with ethical and legal standards, with the primary goal of protecting the security and fundamental rights of AI users. Full compliance with these regulations is not only a legal obligation but also a strategic asset, crucial for securing a company’s long-term competitiveness and aligning its corporate strategy for the future.

For companies, careful adherence to the AI Act means regularly monitoring their AI technologies, conducting risk assessments, mitigating identified risks, and implementing measures to ensure these technologies meet all legal standards.

In addition to AI Act compliance, ISO 42001 holds particular significance. This standard provides an internationally recognized framework for managing artificial intelligence, offering a structured approach that promotes the efficiency and safety of AI technologies from development through implementation to validation with proven methods. By achieving operational excellence through ISO 42001, combined with rigorous AI Act compliance, companies can address the two foundational aspects of responsible AI usage.

However, there is still too great a discrepancy between the announced requirements of the AI Regulation and its actual implementation. Many companies are not sufficiently prepared for the regulations. This underlines the importance of taking the significance of the AI Regulation for companies seriously and developing strategies in good time. With new approaches to the strategic implementation of AI Act Compliance and standards such as ISO 42001, legal requirements can be met and long-term benefits gained.

AI compliance in focus: turning challenges into strategic opportunities

The opportunities and potential of AI are already well known. When used strategically and responsibly in companies, AI technology can be used to automate and increase efficiency in industry and business and even lead to significant advances in medicine. However, the use of AI technologies not only brings opportunities, but also risks and challenges that companies must face.

One key challenge is that the (basic) rights of individuals must be protected by well-thought-out AI regulations, while at the same time, the legal framework should continue to leave room for innovation and opportunity. This central challenge becomes particularly apparent when it comes to issues of ethical implications and data protection. You can read about the relevance of considering ethical aspects in this blog post: “Understanding AI Ethics: Future-proof with the ethical guide for AI technologies”.

The challenges posed by regulations can be effectively resolved. The correct application of compliance plays an essential role here.

Neglecting compliance requirements can not only damage a company's image but also lead to personal liability towards companies and third parties. To avoid possible risks and damages, it is essential to create a structure in the company so that existing risks can be preventively identified and concrete measures can be defined and implemented. Furthermore, strategies should be developed to prevent the disclosure of confidential (company) data in black boxes, where it is not clear what information is processed, how and where, and according to which criteria decisions are made.

A strategically aligned compliance structure can significantly reduce the risk of data leaks and related consequences. By involving AI Act experts—such as Legal Engineers, Data Governors, or Data Stewards—early in the process, companies can position themselves for a clear competitive advantage.

Strategic advantage: how full integration of AI Act compliance secures your business strategy for the future

The Global State of Responsible AI Survey, conducted with researchers from Stanford University and Accenture, reveals that 51% of companies identify privacy and data governance risks as key concerns in their AI adoption strategy. Notably, 62% of companies have yet to develop clear strategies for integrating the EU AI Act into their business models.

However, incorporating AI Act compliance into corporate strategy goes beyond fulfilling legal obligations—it can become a powerful driver of sustainable success. Companies that take proactive steps now will not only secure their market position but also actively shape the future of AI.

Let's take a look at why compliance is a strategic game-changer and how beneficial AI compliance can future-proof your business.

Engaging AI Act experts early: the role of Legal Engineers, Data Governors, and Data Stewards

The complexity of the AI Act makes it essential for companies to address legal, technical, and ethical requirements specific to their operations from the outset. AI Act experts should be involved as early as the planning and development phases of AI projects (including project planning, data engineering, data ingestion, data preparation, and data management) to provide the knowledge needed to interpret the AI Act requirements and support their practical implementation. Early involvement of experts like Legal Engineers, Data Governors, or Data Stewards prevents projects from veering into legally problematic directions and ensures the success of AI initiatives within your organization.

AI Act experts thus play a crucial role in minimizing risks, promoting transparency and ensuring data protection.

While the Data Governor is responsible for developing and defining governance guidelines, risk management with regard to compliance with the data protection requirements of the AI Act, security and compliance, the Data Steward is operational and focuses on the implementation and correct execution or use of the strategic guidelines created by the Data Governor. They are crucial players in adapting a company's data protection management to the requirements of the AI Act. By identifying potential challenges early on, technologies and processes can be adapted in a timely manner and complications can even be avoided..

This interdisciplinary collaboration between legal, technical, and business strategy experts is crucial. It ensures that compliance is met not only in documentation but also in technical and operational execution. Involving AI Act experts such as Legal Engineers, Data Governors, and Data Stewards from the start leads to significant efficiency gains and cost savings. Early consideration of compliance requirements helps companies avoid costly rework and delays later in the development process. This approach not only ensures legal compliance but also fosters smooth, cost-efficient project development.

Building a comprehensive AI Act compliance system for your busines

A Compliance Management System (CMS) tailored to the AI Act is crucial for systematically meeting the law’s complex requirements and ensuring long-term compliance. This CMS should be closely aligned with corporate strategy to ensure that all relevant processes and decisions adhere to legal standards.

An effective CMS requires a clear hierarchy and defined responsibilities, enabling all departments—from R&D to marketing and sales—to work toward shared compliance goals. Continuous monitoring and adaptation are also essential to keep pace with evolving legal requirements and technological advancements. This includes conducting internal audits, providing regular employee training, and closely monitoring AI systems.

One particularly effective means of implementing these requirements is ISO 42001. This standard provides organizations with a clear framework for identifying, assessing, and managing risks associated with the use of AI: ISO 42001 and the AI Act complement each other in many ways, creating synergies that companies can use to build a robust CMS. While the AI Act sets out regulatory requirements and ethical principles, ISO 42001 provides the tools and processes to systematically integrate these requirements into day-to-day business and management.

By adopting ISO 42001 as the framework for their CMS, organizations can ensure that their AI systems are both legally compliant and safe, transparent, and ethical. The standard helps to identify and manage risks at an early stage, making it easier to meet the strict requirements of the AI Act. In addition, ISO 42001 promotes a culture of continuous improvement by requiring regular reviews and adjustments to the CMS. This helps organizations to be prepared for future regulatory changes and to proactively develop their compliance strategies.

In addition, combining AI Act compliance and ISO 42001 standards enables efficient employee training and awareness. These standards provide clear guidelines for training and continuing education that ensure that all relevant stakeholders in the company not only understand the legal requirements but can also implement them effectively. This holistic approach enables companies to create a solid foundation for the successful and sustainable integration of AI technologies that meet both the legal requirements of the AI Act and the highest international standards.

Transparency as a compliance strategy: communicate proactively to build trust

Transparency in AI use fosters trust in your company and safeguards its reputation. Openly sharing the measures you’re taking to comply with the AI Act sends a strong message to customers, partners, and the public. This openness is particularly crucial when handling sensitive data and protecting privacy.

Active and transparent communication can significantly reduce risks. By clearly identifying potential risks and the measures taken to minimize them, companies can avoid misunderstandings and defuse legal conflicts in advance. Should a crisis nevertheless arise, a well-prepared communication strategy helps to ensure a quick and confident response.

Transparency should not be reserved solely for crises but should be an integral part of corporate culture. Regular reports, open dialogues with stakeholders, and public involvement in decision-making help solidify a positive corporate image and strengthen long-term trust in the company’s AI strategies.

Building compliance through strategic partnerships in AI Act adherence

The AI Act not only affects individual companies, but influences the entire value chain. Therefore, it is crucial to establish strategic partnerships and networks to ensure compliance along the entire supply chain.

Strategic partnerships offer a platform to collaboratively develop innovative solutions that meet AI Act requirements. Collaborating with other companies, research institutions, and technology providers fosters innovation while ensuring that all parties remain current with compliance standards.

Targeted partnerships also allow companies to better distribute and manage risks. When all partners in the supply chain understand and adhere to AI Act requirements, the overall risk for each participant is significantly reduced. Networks are invaluable in this context, as they facilitate knowledge exchange and the sharing of best practices in AI Act compliance. Companies can learn from one another and work together to develop effective compliance strategies.

Such partnerships also offer an opportunity to establish industry-wide standards, creating clarity, simplifying compliance, and enabling all players to operate under consistent conditions.

Expert action steps for AI Act compliance and strategic advantage

To effectively implement and execute AI strategies, it’s essential to start by understanding your business’s unique needs. Conducting an analysis and assessment will help you identify how to successfully integrate AI technologies, optimize processes, and eliminate inefficiencies. Incorporating our strategies can help you succeed.

1. Use a regulatory early warning system as an innovation engine

Implement an early warning system that monitors regulatory developments around AI and enables your organization to proactively respond to new regulations. Such an approach transforms regulatory challenges into opportunities by taking timely action to minimize risk and maximize innovation potential.

Implement an early warning system to monitor regulatory developments in AI, enabling your organization to proactively adapt to new requirements. This approach transforms regulatory challenges into opportunities, allowing you to take timely action to reduce risk and boost innovation potential.

2. Embed AI Act regulatory requirements as a driver of your innovation strategy

Integrate AI Act requirements into your innovation process, viewing them as catalysts rather than obligations. By adopting a “compliance by design” approach from the development phase, you create future-proof products that can enter the market more swiftly while minimizing legal risks.

3. Establish interdisciplinary AI committees for strategic advantage

Form AI committees consisting of AI Act experts, developers, lawyers and strategists. These teams ensure that your AI initiatives are not only legally compliant but also have a solid strategic foundation. The close collaboration of experts creates synergies that make your projects more efficient and successful. Such AI councils consist of a range of skill profiles with clearly defined responsibilities and capabilities across the entire machine learning lifecycle. The different skill profiles are integrated into the organization in different ways. We can characterize them by the degree of their centrality within the organizational structure. Some skill profiles are more centralized than others. This means that they can provide centralized guidelines and instructions to other actors in the organization. There are also skill profiles that are less centralized. They are typically located within a business unit and work on a specific use case or project.

4. Develop a comprehensive AI policy as a basis for growth

Create a clear AI policy that not only ensures compliance with the AI Act but also guides responsible innovation aligned with your company’s vision. A well-structured internal policy provides your teams with consistent guidelines, enabling projects to progress securely and effectively.

5. Strengthen your governance with an ethics committee for AI

Implement governance structures with an ethics committee to oversee ethical considerations in AI projects. This promotes transparency and a feedback-driven culture, fostering trust both within your company and with external partners and customers.

6. Use an AI Act-compliant data strategy for a competitive advantage

Develop a data strategy that aligns with the AI Act while driving innovation. Responsible data management protects your company from legal risks and builds the foundation for sustainable, trustworthy business models.

7. Standardize risk assessments to make your projects safer and more effective

Make regular risk assessments a core part of your AI development process. This proactive approach helps identify and resolve potential issues early, improving project efficiency and ensuring regulatory compliance.

8. strengthen your employees' skills through continuous training

Offer continuous training to keep employees updated on regulatory requirements and promote their practical application. Well-trained teams are more efficient and help ensure that AI projects are executed successfully and in compliance with the law.

9. Integrate external expertise for strategic compliance

Engage external experts, such as Legal Engineers, early on to supplement internal resources and ensure your AI projects meet regulatory standards. This collaboration will enable you to reap the benefits of comprehensive compliance while strengthening your innovation.

10. Modernize your technological infrastructure for sustainable success

Upgrade your technology infrastructure to not only comply with the AI Act but also support future innovation. By adopting advanced technologies, you lay the groundwork for efficient, compliant operations that provide a lasting competitive edge.

Taking the AI Act into account in strategic decision-making enables companies to better manage risks while taking advantage of new business opportunities, which can lead to a sustainable competitive advantage.

The AI Act should be seen as an integral part of the corporate strategy. Start to see the new regulation and its aspects as an opportunity and promote transparent communication by publishing clear explanations of data processing procedures and purposes (marketing, internal and external communication).

Treat the AI Act as a vital part of corporate strategy, seeing the regulation as an opportunity. Promote transparency by clearly communicating data processing procedures and purposes, improving trust in both marketing and internal and external communications.

Conclusion: positioning AI Act compliance as a catalyst for innovation and trust

With the introduction of the EU AI Act, companies are facing new challenges. If implemented correctly, these challenges can provide significant opportunities to strengthen their market position. A strategic implementation of AI Act compliance, in accordance with the regulations and the ISO 42001 standard, is essential to minimize legal risks. In this way, it can serve as a catalyst for innovation.

You should therefore take the importance of regulatory requirements seriously in good time and proactively incorporate them into your business strategy with the help of data governors, data stewards and legal engineers. Continuous review and adaptation of AI systems, as well as the early involvement of AI experts, are crucial to your success. Likewise, a well-structured compliance management system that includes the ISO 42001 standard enables you to act in accordance with the law and increase efficiency in your company. In addition, transparent communication about the AI Act compliance measures should strengthen the trust that customers and partners place in you, thus ensuring reputation protection in your company.

Overall, compliant EU AI Act implementation requires interdisciplinary collaboration and a willingness to view regulatory requirements as an opportunity for sustainable success. Companies that act in a timely manner can ensure their competitiveness in this age of digital transformation.