Be Careful What You Share with AI - How to Keep Your Business Data Safe

Artificial intelligence can be a powerful productivity tool, but careless use can create serious data protection and commercial risks.

AI tools are becoming part of everyday business life. They can help draft documents, summarise information, analyse data and speed up routine tasks. Used well, they can save time and improve decision-making. Used carelessly, however, they can expose confidential information, customer data, intellectual property and commercially sensitive material.

Many people do not realise that some AI services may use prompts, uploaded files, chat history or user feedback to improve their systems, depending on the provider’s terms and settings. That means information entered into an AI tool could leave the control of your organisation and create risks around confidentiality, data protection and regulatory compliance. The UK Information Commissioner’s Office states that organisations using AI must consider accountability, transparency, security and data minimisation when personal data is involved.

Why this matters

Business data is valuable. It may include client records, staff information, contracts, pricing, designs, financial forecasts, legal advice, tender submissions or incident reports. If this information is copied into an AI tool without proper safeguards, it could be retained by a third party, accessed outside your approved environment, or used in ways your organisation did not intend.

The risk is not only commercial. If personal data is involved, an accidental disclosure could place the business in breach of data protection obligations. Regulators expect organisations to understand what data they process, why they process it, who can access it and how it is protected. AI does not remove those responsibilities; it can make them more complex.

Common mistakes businesses make with AI

• Pasting confidential emails, contracts or reports into public AI tools.
• Uploading spreadsheets containing personal, financial or client information.
• Assuming that every AI product has the same privacy and retention settings.
• Allowing staff to use unapproved AI tools without guidance or training.
• Failing to check whether AI-generated outputs contain inaccurate, biased or confidential information.
• Using AI outputs in regulated decisions without human review and proper records.

Tips to keep your data safe

1. Do not enter sensitive information into public AI tools. Treat prompts like external disclosures unless you have checked the provider’s contractual terms, privacy settings and data retention policy.
2. Use approved business accounts only. Enterprise AI tools often provide stronger controls than free consumer versions, including administration, access management and data protection settings.
3. Classify your data before using AI. Decide what data is public, internal, confidential or highly restricted, and set clear rules on what can and cannot be used with AI systems.
4. Remove or mask personal and confidential details. Where possible, anonymise, pseudonymise or summarise information before asking an AI tool to process it.
5. Check supplier terms carefully. Understand whether your data may be retained, reviewed, used for model training, transferred internationally or shared with subcontractors.
6. Carry out a risk assessment. For higher-risk uses, especially where personal data is involved, consider a Data Protection Impact Assessment and document the safeguards you have put in place.
7. Train your staff. Make AI awareness part of your cyber security and data protection training so employees understand the practical risks.
8. Review AI outputs before use. AI can produce convincing but incorrect information, so human checking remains essential.
9. Create an AI use policy. Set out approved tools, permitted uses, prohibited data types, escalation points and review processes.

AI should support your business, not expose it

The answer is not to avoid AI altogether. The answer is to use it deliberately, safely and with the right controls. Businesses that put clear rules in place now will be better positioned to benefit from AI while protecting customers, staff, intellectual property and reputation.

If you are unsure whether your current AI use is safe, now is the time to review it. Speak to your IT, compliance or data protection adviser, check your contracts and make sure your team knows what information must never be placed into an AI system.

How does this affect my business

Every business using AI needs to understand what data is being entered, where that data goes, and whether the tool is suitable for the information being processed. A simple review of your AI use, staff guidance and supplier settings can reduce the risk of data leakage, protect your commercial position and help demonstrate that you are taking compliance seriously.

If you would like help reviewing how your business uses AI safely, contact us on 01722 411 999.