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An opinion piece by Colm Gannon, CEO, ICMEC Australia
The release of the ABC’s investigation into AI sexual companion chatbots brings into focus an emerging technology that has, until now, largely operated without meaningful scrutiny. Marketed as tools for companionship, intimacy, or even emotional support, these systems are rapidly gaining traction. Yet their development is increasingly revealing significant gaps in ethical design and regulatory oversight.
It is important to be clear: not all AI companion technologies are inherently harmful. There may be legitimate use cases, including therapeutic applications for individuals experiencing loneliness or social isolation. However, acknowledging potential benefit cannot come at the expense of recognising real and documented risks.
The concern is not simply about how these tools are used; it is about how they are designed. AI sexual companion platforms are built to simulate human relationships, engineered to engage, validate, and sustain emotional connection. These systems operate within a deeply social and psychological space, mimicking intimacy and attachment in ways that traditional software does not.¹
Within this context, the emergence of child-like AI personas represents a critical failure of ethical safeguards. Where systems simulate individuals estimated to represent minors, this is not only morally confronting but engages in clear legal risk. Such design choices reflect a breakdown in governance and a disregard for established societal boundaries.
This is not a question of user misuse. It is a question of system design. Modern AI companion platforms incorporate features such as persistent memory and emotional modelling, intentionally developed to reinforce engagement and dependency.² These dynamics can mirror trust-building and influence mechanisms seen in harmful interpersonal interactions, but at scale, and without a human actor.
Regulation has not kept pace with this shift. Australia has largely adopted a reactive or ‘light touch’ approach to emerging technologies. That posture is no longer sufficient. The development of systems operating in domains such as intimacy, sexuality, and identity requires a level of oversight that reflects their societal impact.
This is not about restricting innovation. It is about ensuring innovation operates within clearly defined boundaries. Governments must establish enforceable standards for high-risk AI systems, including requirements for pre-deployment testing, clear prohibitions where necessary, and ongoing compliance mechanisms.
There must also be explicit legal clarity. The simulation of child-like personas in sexualised contexts should not exist within regulatory grey areas. It must be clearly prohibited.
Public sentiment already supports this shift. Research consistently indicates strong community expectation for government oversight of AI technologies, reflecting a broader recognition that innovation must be safe, ethical, and accountable.
There is also responsibility within the industry. Engineers and developers must understand that success is not defined solely by speed to market or user engagement. Ethical design is not optional; it is fundamental.
As a society, we should not be timid in demanding that technology meets clear standards. Nor should we accept the creation of new forms of harm in the name of economic innovation.
AI is already embedded in everyday life, and its role will continue to expand. The question is not whether it will shape human behaviour, but whether we are prepared to shape the rules that govern it.
Innovation without ethics is not progress. It is risk at scale.
Footnotes:
¹ AI chatbots and digital companions are reshaping emotional connection, https://www.apa.org/monitor/2026/01-02/trends-digital-ai-relationships-emotional-connection
² F. Chang and D. Herath, "From Interaction to Relationship: The Role of Memory, Learning, and Emotional Intelligence in AI-Embodied Human Engagement," 2025 20th ACM/IEEE International Conference on Human-Robot Interaction (HRI), Melbourne, Australia, 2025, pp. 1269-1273, doi: 10.1109/HRI61500.2025.10973813.
About the Author
Colm Gannon is the CEO of ICMEC Australia, leading the organisation's efforts to protect children from sexual exploitation and abuse. With 20 years of law enforcement experience spanning cybercrime investigations, online harms, and child sexual exploitation, combined with expertise in AI policy and technology development, Colm is one of Australia's foremost experts on child protection and the role of technology in both enabling and preventing harm to children.
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