AI Security for Small Businesses: Do You Know What Your Employees Are Sharing?

Artificial intelligence is becoming part of everyday working life. From drafting emails and summarising meetings to analysing spreadsheets and preparing presentations, tools such as ChatGPT and Microsoft Copilot are helping businesses work smarter. But here's a question every business owner should be asking: do you know what information your employees are sharing with AI? The Information Commissioner's Office (ICO) has increased its scrutiny of AI developers and how personal information is handled. It's a timely reminder that AI security for small businesses deserves attention. AI offers enormous opportunities for SMEs, but without the right safeguards, businesses could be exposing confidential information without even realising it. So, where should you start?

1. Do You Know Which AI Tools Your Employees Are Using?

AI tools are incredibly accessible. Anyone can create an account and start experimenting, often without involving their employer or IT provider. This is sometimes called shadow AI, where employees use AI applications that haven't been formally approved by their organisation. It doesn't necessarily mean anyone is doing something wrong. An employee might simply be trying to save time or improve their work. However, problems can arise when customer information, financial documents or confidential business plans are uploaded to an unapproved platform. What should you do? Start a conversation with your team. Find out which tools they're using, what they're using them for and whether those tools have been assessed for security. Understanding what's happening is the first step towards managing it.  

2. Understand What Happens to Your Business Data

Not all AI platforms handle information in the same way. Some offer enterprise-level controls, while others have different arrangements for retaining information, using data to improve services and managing access. Before employees share sensitive information, businesses should understand exactly where that information goes and how it's protected. Think about the information your organisation holds:

• Customer names, addresses and contact details
• Employee records and personal information
• Financial reports and commercial agreements
• Confidential client documents
• Business plans and intellectual property

Would you be comfortable with that information being uploaded to an external platform? The Information Commissioner's Office provides guidance on using AI while meeting data protection obligations. A good starting point is to establish what information employees can share, which tools are approved and what checks are required before introducing new applications. Your existing cyber security arrangements should also cover how AI is being used across the business.

3. Check Your Microsoft 365 and Copilot Permissions

Microsoft Copilot is becoming an increasingly familiar tool for businesses using Microsoft 365. It can help employees find information, summarise documents and work more efficiently. However, there's an important point businesses shouldn't overlook. AI doesn't automatically fix poor data access controls. For example, if an employee already has permission to access confidential documents they shouldn't be seeing, Microsoft 365 Copilot may make that information easier to discover. Before introducing Copilot across your organisation, review who has access to SharePoint folders, Teams files and other sensitive information. Check whether former employees still have accounts, whether documents are shared too widely and whether permissions reflect people's actual responsibilities. Microsoft provides guidance on security and data protection for Copilot. It's worth getting these foundations right before expanding AI use.

4. Create a Simple AI Policy Your Employees Will Actually Read

An AI policy doesn't need to be a complicated document full of technical language. It should simply explain how employees can use AI responsibly. That might include which tools are approved, what information must never be uploaded, who authorises new applications and when AI-generated work needs checking. It's also important to remember that AI can produce incorrect information while sounding completely convincing. Employees should never assume that an AI-generated answer is accurate simply because it looks professional. The National Cyber Security Centre provides useful advice about the opportunities and risks associated with AI. Make the policy practical, explain why it matters and provide training so employees understand their responsibilities. The aim isn't to discourage people from using AI. It's to give them confidence to use it appropriately.

5. Make AI Security Part of Your Wider IT Strategy

AI shouldn't be treated as something separate from the rest of your business technology. It affects data protection, employee productivity, software licensing, information management and cyber security. As your business introduces more AI applications, these considerations become increasingly important and that's why regular reviews are essential. Consider whether your current systems are secure, whether employees have appropriate access permissions and whether new tools are genuinely delivering business benefits. Your IT provider should be helping you answer these questions, not simply installing software and leaving you to work things out. A structured approach to IT strategy and project planning can help businesses adopt new technology without introducing unnecessary risks.

AI Security for Small Businesses: Getting the Balance Right

AI has enormous potential to help smaller businesses become more productive, competitive and efficient. But adopting new technology shouldn't mean compromising the security of your business or your customers' information. At Illuminate IT, we believe businesses should feel confident about embracing AI, while understanding the risks and putting sensible safeguards in place. That means knowing which tools are being used, protecting sensitive information, reviewing access permissions and giving employees clear guidance. You don't need to become an AI expert overnight but you do need to ask the right questions and make sure someone is looking after the security of your systems and data. The question isn't whether your employees should be using AI. It's whether your business is helping them use it safely. If you're unsure how securely your business is using AI, talk to Illuminate IT about reviewing your existing systems, permissions and security arrangements.