Harvard Ethics Center Warns US AI Action Plan Shifts Governance Burden to Private Sector

A November 2025 analysis from the Harvard Ethics Center, AI Governance Crossroads: America's AI Action Plan and Its Impact on Businesses, examines the current US AI Action Plan and concludes that the federal government's deregulatory posture is transferring primary responsibility for AI ethics and governance to private-sector organizations. The analysis identifies several executive orders as central to this shift, including directives instructing federal agencies to prevent ideologically biased AI outputs, accelerate data center permitting, and promote the export of US AI technology. The research finds that this policy direction, combined with regulatory volatility at the federal level, leaves companies without consistent government standards on which to rely for compliance planning.

The analysis was published against a backdrop of sustained federal deregulation in the AI sector, reflecting a broader policy trend in which the US government has moved away from prescriptive AI oversight in favor of competitiveness and innovation priorities. This approach contrasts with regulatory frameworks taking shape in the European Union and other jurisdictions, where binding requirements on AI system design, transparency, and risk assessment are being codified into law. The Harvard Ethics Center's research highlights that the absence of federal mandates does not eliminate governance obligations for US companies; instead, it relocates accountability to internal structures while increasing exposure to scrutiny from non-governmental actors including investors, customers, and business counterparties.

For enterprise compliance teams, the analysis signals several concrete areas requiring attention in the near term. Organizations should audit existing internal AI ethics policies and governance frameworks to assess whether they are sufficiently documented and defensible in the absence of binding federal standards, since investors and institutional customers are increasingly likely to request evidence of structured AI oversight. Compliance functions should also track state-level AI legislation, as regulatory gaps at the federal level have historically accelerated state action in the US, creating a fragmented compliance landscape. Risk teams should additionally monitor how counterparty due diligence standards evolve, particularly in regulated sectors such as financial services and healthcare, where AI governance disclosures may become a contractual or procurement requirement before any federal mandate takes effect.