Shadow AI

Term: Shadow AI

Shadow AI, by definition, refers to AI tools, applications and services that employees use without IT or security team oversight, the AI counterpart to shadow IT. It typically emerges when staff adopt generative AI assistants, transcription tools or analysis platforms to do their work faster, outside any sanctioned procurement or review process.

Why it matters

Shadow AI creates governance risk because these tools often process sensitive business data such as customer information, financial records and internal communications without the data governance, access controls or vendor due diligence that sanctioned AI tools undergo. For organisations in regulated sectors, an unreviewed tool can move protected data outside controlled boundaries with no audit trail and no contractual safeguards.

The risk compounds quietly. Each unsanctioned tool widens the gap between what your security team believes is in use and what staff actually rely on day to day.

How it works in practice

Shadow AI is discoverable through structured inventory work. We catalogue the tools in active use, identify what data each one touches and assess vendor terms and access controls. This inventory is the foundation of any AI Security or ISO 42001 programme; you cannot govern what you have not mapped. See our Shadow AI Discovery service for a structured inventory approach.

Related terms: Shadow IT and AI Governance.