AI transparency and disclosure means being upfront about when and how AI is used in your business, particularly when customers interact with it or when it influences decisions about them. It is one of the practices in the Australian Government's Guidance for AI Adoption.
It can be as simple as a chat window that says "I'm an AI assistant", a note on a phone line, a label on AI-generated images, or a line in the privacy policy about automated decisions. It also covers explaining what the AI can do and how to reach a human.
Retailers and venues should identify the places AI touches customers: chat, calls, recommendations, pricing, camera analytics, marketing content and reviews. Then decide what to disclose and where. Privacy law changes are bringing extra transparency duties around some automated decisions; check current rules and seek advice.
Pitfalls include giving an AI assistant a human name and photo, hiding it, using AI-written testimonials or reviews that suggest real customers, and disclosing in terms nobody reads. Misleading customers can also raise consumer law issues. Plain wording near the point of use, such as in the chat window, works better than a clause buried in the terms.
It matters because surveys regularly show customers want to know when AI is involved. Honest disclosure builds trust and avoids damaging surprises.