“Shadow AI” may sound mysterious, but it’s simply artificial intelligence being used in the shadows — without official approval. When employees use AI tools on their own, without informing their organisation’s IT or security teams, it’s called shadow AI.
Think of a designer quietly using a free chatbot to write captions, or a manager asking an AI tool to analyse confidential data. It saves time, but it also skips all the safety checks. The result? Sensitive information might end up stored or shared somewhere no one can monitor.
Shadow AI is growing fast because many AI tools are quick, creative, and easy to access. But without proper rules, even a small mistake can cause data leaks, privacy breaches, or wrong decisions based on flawed AI output.
Companies are now setting up AI-use policies — just like internet safety rules — to guide how employees can use these tools responsibly. Some are even building their own approved AI platforms so that work data stays secure and traceable.
It’s named after ‘shadow IT’
The term comes from employees using unapproved apps like Google Drive or Dropbox years ago.
AI detectors can find shadow use
Some companies now use tracking tools that flag unapproved AI activity on their networks.
Even executives use it secretly
Surveys show senior staff are just as likely to use AI tools unofficially as junior employees.
Some firms turned it into a positive
Instead of banning it, a few companies turned shadow AI projects into official innovation programs.