India firms rapidly scaling AI amid need for stronger governance and security: Report

India Inc. is rapidly scaling AI, fueled by global tailwinds, competition and advances in GenAI technologies, a report said on Wednesday, noting that AI now cuts across customer engagement, operational optimisation and mission-critical processes in multiple sectors.
Yet adoption remains fragmented, with only 15 per cent of organisations having extensive enterprise-wide AI deployment.
“While AI will continue growing, oversight is not keeping pace with it.
In many organisations, AI infrastructure is expanding faster than the governance, security and ethical safeguards needed, creating widening gaps in accountability and risk management,” Alvarez &Marsal (A&M), a global professional services firm, said in its report. Meanwhile, governance maturity remains limited despite rising usage.
While 60 per cent of organisations have introduced basic governance or acceptable-use policies, only 19 per cent have carried out detailed risk assessments, and 81 per cent still lack full visibility of how their AI systems are monitored or governed, the report noted.
With many AI initiatives developed in silos, accountability and standards vary widely, especially when third-party and in-house models coexist.
The report highlighted the need for integrated, organisation-wide governance frameworks that embed transparency, oversight and clear role ownership.
Those who invest early in these foundations will be best placed to unlock the full economic and competitive potential of AI, he added.
According to the report, responsible AI principles are widely acknowledged; however, their implementation remains limited. Fewer than 20 per cent of organisations have deployed mechanisms for explainability, bias detection or fairness, and 60 per cent lack any formal process to validate model integrity.
The report also highlighted that as more complex AI models go into production, security across the AI lifecycle will be imperative.