Why the Middle East Leads the World in AI Governance
News that “Middle Eastern boards are leading the UK and US in AI governance plans” has been making headlines. According to reports from arabnews.jp, Middle Eastern countries are outpacing developed nations in building governance frameworks for responsible AI use.
At first glance, this might seem like a topic for large corporations or national governments. However, I believe it holds important insights for the governance design of small and medium enterprises (SMEs).
Why has the Middle East been able to get ahead? The reason lies in “the opportunity to design from scratch.” Unbound by existing regulations and practices, they were able to build an ideal governance structure in a short period.
This also applies to SMEs. With fewer complex organizational structures and historical baggage than large corporations, they have the potential to introduce flexible and effective governance.
The Assumption That “AI Is Special” Creates Risk
Many SME owners tend to think, “AI governance has nothing to do with us.” However, this mindset itself is a risk.
In reality, the adoption of AI tools is rapidly progressing even in SMEs. It’s not uncommon for companies to unknowingly integrate AI into their operations, such as analyzing customer data, assisting in hiring decisions, or generating text.
The problem is the lack of rules governing AI use. Basic governance is missing—who uses AI for what purpose, and who is responsible for those decisions.
News that Saudi Arabia advocated for “responsible AI governance” at the United Nations can be understood in the same context. There is growing international recognition that clear rules and monitoring mechanisms are necessary for responsible use.
Designing “Lightweight Governance” for SMEs
The key point here is that SMEs don’t need to adopt the same governance as large corporations. Instead, it’s more realistic to design “lightweight governance” tailored to your company’s size and business.
Specifically, focusing on the following three elements is sufficient.
1. Clarify the Purpose and Scope of AI Use
First, decide which tasks AI will be used for and which tasks it should not be used for. For example, set boundaries like “AI should not write final replies to customers” or “AI should not be used to analyze personal data.”
It’s important to communicate these rules to employees and gain their understanding. Clear rules reduce confusion in decision-making on the ground.
2. Clearly Define Who Is Responsible for Decisions
Determine who will make the final decisions regarding AI use. This includes designing processes such as whether AI-generated suggestions are adopted as-is or must always be reviewed by a human.
From my experience, introducing AI without clarifying “where responsibility lies” often leads to major problems later. This is because it’s unclear who takes responsibility when AI makes a wrong decision.
3. Establish a System for Regular Reviews
AI technology evolves daily. Set up opportunities to review current rules and usage at least once every six months. The act of creating this review process itself is a practice of governance.
What’s especially important is building a habit of reviewing before problems occur, not after. The reason Middle Eastern countries were able to get ahead is precisely because they acted before issues became apparent.
Dispelling the Misconception That “Governance = Restrictions”
Many business owners worry that “strengthening governance will slow down operations” or “more rules will reduce freedom.” However, this is a misunderstanding.
Proper governance actually streamlines operations. For example, if AI usage rules are clear, teams can use AI without hesitation. If the responsible person is clear, decisions don’t take time.
What the Middle Eastern case shows is the perspective that governance is not about “prohibition” but about “designing to enable.” Governance is valuable precisely because it enables the responsible use of AI.
Three Questions to Audit Your Company’s Governance
Finally, I present three questions for business owners to audit their company’s governance.
First: “Can you list all the tasks in your company that use AI?”
Second: “Have you documented the rules regarding AI use?”
Third: “Do you have a system in place for regularly reviewing these rules?”
Companies that can answer “yes” to all three questions already have a certain level of governance functioning. If there’s a “no,” start improving from there.
AI governance is by no means a theme only for large corporations. On the contrary, SMEs should leverage their ability to design nimbly and take the lead in this area. Why not start reviewing your company’s governance with a small step you can take today?
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