As AI use grows, concerns about transparency, trust, and compliance are intensifying. Organizations developing AI must prioritize transparency to meet regulatory requirements and build stakeholder confidence. Key principles include explainability, accountability, and fairness. To ensure transparency, AI systems should implement clear data collection policies, use Explainable AI (XAI) tools, and adhere to regulations like GDPR and HIPAA. Building ethical AI and ensuring compliance fosters trust and reduces legal risks, offering a competitive advantage.