Emerging AI risks for Charities
With the accelerating use of artificial intelligence (AI) in various aspects of today’s world, charities need to evaluate the impact of AI on day-to-day operations and their compliance with regulatory requirements.
The ACNC advises in their “Charities and Artificial Intelligence” guide that charities should consider the following:
- The opportunities and risks AI affords.
- How a charities responsibilities interact with the use of AI; and
- How to effectively respond to and monitor the risks associated with the use of AI.
The “Charities and Artificial Intelligence” guide can be found here.
Charities must recognise that AI risk extends beyond their own IT environment. In a common scenario, service providers charities engage may be using AI to process the personal and sensitive information made available to them by the charity. Of particular risk are, for example, donor lists which many charities would hold.
In the “Guidance for AI Adoption: Foundations” published by the Federal Governments National AI Centre on the 21 October 2025, it is re-affirmed that a charity holding personal and sensitive information is ultimately responsible for this information.
Therefore, particularly when a service provider will have access to personal and sensitive information, it is important when negotiating service agreements to consider:
- Contractual provisions stipulating the use of AI by the service provider is prohibited in the provision of the service.
- Contractual provisions listing safeguards that the service provider must follow.
- Developing an organisation wide AI Policy.
- Reviewing your insurance policies to understand if the cover your charity has extends to service providers.
The “Guidance for AI Adoption: Foundations” can be found here.