Disparate Impact
A legal and ethical concept where a seemingly neutral AI system or policy disproportionately affects a protected group, even without explicit intent to discriminate.
In plain language
When an AI rule that seems neutral actually hurts a specific group. For example, an AI that screens resumes by postcode might unintentionally discriminate against certain racial groups who live in those areas.
Why this matters
Even well-intentioned AI systems can produce discriminatory outcomes. Your AI risk assessment process must evaluate for disparate impact to protect the organisation from legal liability and ensure equitable treatment of all stakeholders.
Relevance
GovernanceAustralian discrimination law and the Privacy Act require organisations to prevent adverse impacts on protected groups; disparate impact assessment is a governance control that mitigates both legal and reputational risk.
Related terms
Putting disparate impact into practice in your organisation?
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