Policy is the stage in which the institutional rules that should apply are structured in relation to information interpreted through Evaluation.

In the previous Evaluation stage, the same Fact, such as a “Knife,” could have different meanings depending on Context, including Cooking, a Movie, or Crime. However, even if Evaluation determines that a knife is associated with cooking or may be related to criminal activity, that assessment alone does not determine what the system should do. This is where Policy becomes necessary.

Policy connects Facts and Evaluations to rules established by institutions and organizations. For example, a Cooking Context may result in Allow, a Crime-related Context may require Block, while expressive use such as a Movie may be Allow With Condition when specified requirements are satisfied.

Importantly, the same Policy does not always apply to the same subject. Applicable Policy may vary according to purpose, user, region, organization, industry, and Risk. An action permitted within one organization may require additional Review in another, while a different jurisdiction may impose different regulatory requirements.

Policy in I2EA is therefore not a moral judgment created by the AI model itself at the moment of use. Instead, laws, regulations, standards, contracts, organizational rules, and other external governance requirements are structured into forms that can be applied operationally. Translation of institutional requirements into Machine-readable Governance provides the foundation for separating Policy from the AI’s own probabilistic interpretation.

At the same time, Policy is not itself a Decision. Even when a Policy specifies Block or Allow With Condition, it remains necessary to determine who has the Authority to establish that Policy and who may authorize a particular judgment or exception. Once Policy and Authority have been established, a Decision can be formed and connected to Execution.

Policy therefore functions as a normative layer connecting meaning structured through Evaluation to institutional requirements.

Evaluation structures what it may mean.Policy structures what should apply.

Policy itself does not possess Authority or Execution capability. Maintaining this separation establishes the governance structure through which I2EA proceeds to Authority, Decision, and Execution.