If your organisation is exploring the potential of AI – whether through Microsoft Copilot, automation tools, or custom-built models – now’s the time to take a serious look at ISO 42001.
The world’s first international standard for AI management systems, ISO/IEC 42001:2023, landed quietly in late 2023. But in 2025, it’s starting to make some serious waves – especially for organisations that want to stay ahead of regulatory demands, maintain public trust, and build a resilient data governance strategy.
So, what is ISO 42001, and what does it mean for the way you manage AI and data risk?
What is ISO 42001?
ISO 42001 sets out requirements for establishing, implementing, maintaining, and continually improving an Artificial Intelligence Management System (AIMS). In plain English: it’s a roadmap for running AI responsibly.
The standard provides a framework for organisations to manage the unique risks AI introduces – from ethical concerns and algorithmic bias to data quality, explainability, and accountability.
“AI systems don’t exist in a vacuum – they’re shaped by the data, decisions, and people behind them,” explains Nivasha Sanilal, Compliance Lead at Cloud Essentials. “ISO 42001 helps organisations take ownership of that full lifecycle, embedding responsibility into every stage of AI deployment.”
It’s not a prescriptive “how to” guide for building AI models, but rather a strategic blueprint for managing the AI lifecycle within a structured governance framework.
Key pillars of ISO 42001 include:
- Ethical AI use
- Transparency and accountability
- Risk and impact assessments
- Data governance and privacy protections
- Continuous improvement and oversight
Why does ISO 42001 matter?
AI isn’t just another IT project. It raises real questions about ethics, accountability, and trust – not to mention significant regulatory and reputational risk. ISO 42001 offers a way to address these challenges head-on, helping organisations demonstrate responsible governance and stay on the right side of fast-evolving laws and public expectations.
“In many ways, ISO 42001 is doing for AI what ISO 27001 did for information security,” says Nivasha Sanilal, Compliance Lead at Cloud Essentials. “It’s creating a shared language and benchmark for what good AI governance looks like. That’s essential if we want to build trust and scale responsibly.”
By aligning to ISO 42001, organisations can:
- Mitigate legal, operational and ethical risks related to AI deployment
- Build trust with customers, employees, regulators and partners
- Demonstrate accountability through clear structures and documentation
- Support innovation by creating a well-governed environment for AI experimentation
- Prepare for compliance with new and emerging AI regulations like the EU AI Act or UK AI Code of Practice
It’s a strong signal – internally and externally – that AI isn’t being used recklessly, but with rigour, reflection, and responsibility.
Who needs to care about ISO 42001?
Whether you’re building AI models from scratch, embedding third-party tools, or just starting to explore Copilot, the reality is this:
If your organisation is using AI in any meaningful way, ISO 42001 should be on your radar.
The standard is relevant to a wide range of roles and responsibilities – not just data scientists and developers. Key stakeholders include:
- Software vendors building AI functionality into their products
- Organisations adopting Microsoft Copilot or other AI tools within Microsoft 365
- Compliance teams tasked with ensuring ethical and regulatory alignment
- Leadership accountable for reputational, legal, and operational risk
- Procurement teams sourcing AI solutions from third parties
- IT and data owners governing how AI is trained, deployed, and maintained
- Businesses seeking to demonstrate responsible AI governance to clients, partners, or regulators
In regulated industries and public sector environments ISO 42001 is increasingly being used as a benchmark for responsible AI governance.
Pro tip: You don’t need to be deep into AI adoption for ISO 42001 to apply. It’s actually most powerful at the start of your journey – giving you the structure to build responsibly from day one, rather than scrambling to fix gaps later.” – Nivasha Sanilal
What does ISO 42001 mean for data governance?
ISO 42001 doesn’t treat data governance as a background process. Rather, it makes it clear that managing the quality, integrity, and lifecycle of your data is essential for trustworthy, compliant AI.
“Data governance isn’t just a supporting act for AI – it’s centre stage,” says Nivasha. “Under ISO 42001, you need traceable, high-quality data with clear policies for how it’s collected, stored, used, and shared. Without that, your AI strategy could collapse under scrutiny.”
That means getting the basics right, including:
- Policies for data sourcing, retention, and classification
- Measures to protect data privacy and confidentiality
- Controls to limit how much data is collected, what it’s used for, and who can access it
- Tools to track where data comes from, how it’s used, and what impact it has
“Transparency is a major theme,” adds Nivasha. “If you can’t explain where your AI gets its data, how it processes it, and what decisions it’s making – you’re not compliant.”
And this isn’t just about meeting audit requirements. Following these principles builds trust in your AI outcomes and sends a strong message that your organisation is serious about governing AI responsibly.
Where to start?
Whether you’re preparing for a Copilot rollout or building your organisation’s AI strategy from scratch, ISO 42001 offers an excellent lens to examine your current governance maturity, and where the gaps lie.
Depending on where you’re at, Cloud Essentials offers two practical starting points to help you move forward with confidence:
- Copilot Maturity Assessment: Understand how Copilot-ready your organisation really is, from data governance and security to permissions and risk exposure.
- Data Governance Assessment: Identify your top data risks and get a tailored roadmap for how Microsoft Purview can help mitigate them, backed by expert guidance and stakeholder alignment.
The reality is: AI is not slowing down. And neither are the expectations around how it’s governed. Whether you’re aiming for ISO 42001 compliance or simply want to strengthen your data foundations, Cloud Essentials can help you get your ducks in a row.
Get in touch to start the conversation.
Q&A
- What is ISO 42001 and why does it matter?
ISO 42001 is the first international standard for managing AI responsibly. It provides a framework to help organisations address ethical, legal, and operational risks, build trust, and prepare for future AI regulations.
- Who should be paying attention to ISO 42001?
Any organisation using or planning to use any form of AI should consider ISO 42001. It’s relevant for IT, compliance, leadership, and procurement teams alike.
- How is data governance linked to ISO 42001?
Data governance is a core pillar of ISO 42001. The standard requires clear policies around how data is collected, stored, and used, with strong controls for privacy, access, and accountability across the AI lifecycle.
- What tools can support ISO 42001 compliance?
Microsoft Purview offers a suite of tools to help manage data risk, monitor compliance, and enforce governance policies – all essential for aligning with ISO 42001. Cloud Essentials helps organisations deploy it effectively.
- How can Cloud Essentials help us get started?
We offer two tailored services: a Copilot Maturity Assessment to check your AI readiness, and a Data Governance Assessment to build a roadmap for managing data risk. Both are designed to kickstart your responsible AI journey.