Zoho has released new research showing that South Africa is emerging as a leader in responsible AI adoption, with 92.6% of businesses having started their AI journey and many prioritizing ethics and privacy-first frameworks shaped by the POPI Act.
The study, titled “The AI Privacy Equation: Cautious Innovation in South Africa,” surveyed 372 South African business professionals across industries and company sizes and was conducted by Arion Research on behalf of Zoho.
The study further highlighted that, as compared to other markets, more South African businesses (40%) prioritized AI ethics and responsible usage. Furthermore, 74% of organizations strengthened their privacy measures since implementing AI, with the POPI Act having improved privacy awareness.
“South Africa’s approach demonstrates that privacy and innovation are not opposing forces,” said Andrew Bourne, Country Head, Zoho South Africa. “By embedding ethical and privacy-by-design principles into AI implementation, businesses here are building the foundation for long-term trust, resilience, and success.”
Privacy as the Cornerstone of AI Innovation and the role of POPI Act
As per the study, while privacy concerns were cited as the top barrier to AI adoption (35%), these same concerns are driving stronger safeguards: nearly three-quarters of organizations (74%) have strengthened their privacy measures since implementing AI. This also impacts investments in the technology and governance practices: 30.7% of respondents allocate over 30% of their IT budget to technology, 56% of respondents conduct third-party AI risk assessments, 53% maintain documented AI use policies, and 50.8% conduct regular privacy audits of AI systems.
The study also underscores the country’s maturity in privacy management: 89% of respondents have a dedicated privacy officer or team. Moreover, 42% of respondents conduct quarterly privacy-impact assessments, while 22% conduct them before a new system is implemented.
The Protection of Personal Information Act (POPIA) has played a pivotal role in shaping the privacy-first mindset in South Africa. 68% of the respondents report increased awareness of privacy and data protection obligations since the Act’s introduction, largely due to internal training (56.8%), government sources (55.5%), and news media (53.5%). Because of this, when processing sensitive data for AI systems, 31.4% of respondents prefer explicit consent and transparency, 28% use anonymization, and 23% create synthetic data.
“South African organizations are showing remarkable maturity in balancing AI innovation with privacy protection,” said Michael Fauscette, CEO & Chief Analyst, Arion Research LLC. The combination of 89% having dedicated privacy teams, 74% strengthening privacy measures through AI adoption, and 40% prioritizing AI ethics above global averages isn’t coincidental; it’s strategic. This approach, where privacy and ethics are embedded rather than added on, is creating sustainable competitive advantage and positioning South Africa as a leader in responsible AI adoption across emerging markets.”
Strong Technical Leadership and Ethics Integration
The report highlights South Africa’s exceptional technical leadership involvement in AI governance. 17.5% of respondents hold IT Director or CIO roles, and 38% hold CEO-level positions—one of the highest ratios of executive and technical collaboration among emerging markets. This leadership mix is fostering measured, sustainable AI adoption, ensuring innovation proceeds with accountability and foresight.
This unique technical leadership influence manifests itself in the way organizations in South Africa are matching AI sourcing strategies to their specific needs. This is suggested by the diversity in their sourcing strategy: 22% of respondents use custom vendor solutions and a hybrid approach, 20% leverage AI embedded in enterprise applications, and 15% develop in-house capabilities.
In terms of skills development, the primary gap is skilled in-house resources (26.6%). However, for training, 58.6% of organizations prioritize data analysis and interpretation, and 52.9% focus on literacy and concepts. Most importantly, nearly 40% of organizations include ethics and responsible AI training in their programs—well above the global average. This focus reflects a belief that human-centered and ethical AI design is a competitive differentiator.
The technical leadership also leads to a mature response in case of an AI incident. In case of a significant AI error impacting customers, 42.4% of respondents say they will continue to use AI with increased human oversight, 26.5% would follow pre-established incident response plans, while 19.4% would modify systems for limited redeployment.
The research identifies South Africa’s model as a blueprint for other emerging markets: a balanced approach that combines technical leadership, privacy-first design, ethics-integrated training, and proactive regulation.
“South African organizations are showing that responsible AI is not just a regulatory requirement—it’s a strategic advantage,” added Bourne. “By uniting innovation with trust and transparency, they are building a model of digital progress that can inspire the rest of the continent.
