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OECD Framework for AI Classification | Netlawgic Legal Services LLP

Overview of the OECD AI Classification Framework, its key dimensions, and AI governance principles

Understanding the OECD AI Classification Framework

The OECD Framework for the Classification of AI Systems provides a structured approach to understanding and regulating Artificial Intelligence (AI) systems. With AI being deployed across various sectors, classification helps policymakers, businesses, and regulators address AI-related challenges, ensure responsible innovation, and mitigate risks.

Why AI Classification Matters?

Artificial Intelligence applications vary widely in purpose, complexity, and impact. A structured classification system enables:
✔ Better AI governance by distinguishing different AI functions and risks.
✔ Policy adaptation for industry-specific AI applications.
✔ Informed regulatory decisions to balance innovation and oversight.

The 5 Key Dimensions of the OECD AI Framework

1️⃣ People & Planet: Societal & Environmental Impact

  • User Competency – Evaluates whether AI users require specialized skills.
  • Stakeholder Impact – Identifies communities affected by AI decisions.
  • Human Rights & Ethics – Assesses AI’s implications on fundamental rights.
  • Environmental Considerations – Measures AI’s carbon footprint and societal impact.

2️⃣ Economic Context: Industry-Specific AI Policies

  • Sector-Specific AI Applications – Tailoring policies for finance, healthcare, e-commerce, and manufacturing.
  • Business Functions – Understanding AI’s role in operations, automation, and decision-making.
  • Deployment Scale – Examining AI adoption from pilot projects to large-scale implementation.

3️⃣ Data & Input: Handling AI Data Responsibly

  • Data Collection & Rights – Ensuring compliance with privacy laws and ethical data practices.
  • Identifiability & Quality – Addressing risks of biased, outdated, or incomplete datasets.
  • Data Security & Governance – Implementing standards for secure AI data handling.

4️⃣ AI Model: The Core of AI Decision-Making

  • Model Characteristics – Understanding different AI learning techniques and model transparency.
  • Explainability & Fairness – Ensuring AI decisions are interpretable, unbiased, and ethical.
  • Evolution of AI Models – Evaluating the adaptability and improvements of AI over time.

5️⃣ Task & Output: AI System Functionality

  • AI System Tasks – Categorizing AI functions such as prediction, recognition, and automation.
  • Action Autonomy – Assessing the level of human intervention vs. autonomous AI decision-making.
  • Evaluation & Performance – Setting up metrics and benchmarks for AI effectiveness.

Why Businesses & Policymakers Need the OECD AI Framework?

  • Provides a structured approach to AI risk assessment and innovation.
  • Helps governments draft AI policies with clear regulatory parameters.
  • Enables corporate AI governance for ethical and compliant AI deployment.

The OECD AI Framework ensures that AI technologies are transparent, fair, and accountable, promoting a responsible AI ecosystem across industries.

Internal & External References for AI Compliance & Governance

🔗 Internal Links (Netlawgic Legal Services)

🔗 External References (OECD & AI Regulation)

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