Sector Risk Classification

Sector risk classification refers to the practice of grouping AI systems by the industry or domain they operate in, such as healthcare, financial services, employment, or critical infrastructure, and assigning a risk level based on where the system is used. This matters for enterprise AI governance because many regulations, including the EU AI Act, treat the same model differently depending on its deployment context, so a tool used for hiring or credit scoring may face strict obligations that a general-purpose tool does not. Compliance teams need to map each AI use case to its sector early, since that mapping determines which controls, documentation, and oversight requirements apply.

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