Diginomica analyst Derek: enterprise AI contracts cannot transfer AI liability; governance gap constrains deployment

Diginomica analyst Derek recently drew on numerous in-depth interviews to make a judgment with direct implications for AI industry investment: enterprise buyers cannot transfer AI liability to vendors through contracts. He cites survey data from the Diginomica network earlier this year—65% of CIOs said AI was getting the largest share of their new technology investment, yet just 3% were very confident their governance was fit for the AI tools they were deploying, and 12% admitted they were deploying faster than they could govern.

Derek's core argument does not deny the value of contracts but identifies their structural limits in allocating AI liability. He states: 'It comes down to you as a buyer to understand the risk you're willing to accept and think about how you can internally manage against it—rather than thinking your contract is going to protect you.' Another practical constraint is the insurance market: there are currently almost no mature AI liability insurance products available for enterprise purchase.

Derek further notes that if you're in Europe, this theme is also reflected in the EU AI Act. The Act defines the organization using an AI system as a 'deployer,' imposing compliance obligations on deployers. For an enterprise buying AI software to use in its own business, the 'deployer' is often the enterprise itself—not the vendor. Derek summarizes: 'A lot of the responsibility for this stuff lies not in the contract, but within an organization itself.'