What is a Global Capability Center (GCC)?

A Global Capability Center (GCC) is a centralized offshore unit established by an organization to deliver strategic services such as IT, engineering, analytics, finance, and R&D to support global operations.

What is an Offshore Development Center (ODC)?

An Offshore Development Center (ODC) is a dedicated team located in a different country that focuses primarily on software development, application maintenance, and technology support for a client.

What services are commonly delivered through a GCC?

GCCs provide services such as IT operations, product engineering, data analytics, cybersecurity, finance and accounting, HR services, and research and development.

What are the key benefits of setting up a GCC?

Key benefits include cost optimization, access to global talent, operational scalability, faster innovation, improved control, and long-term strategic value creation.

Which industries commonly use GCCs and ODCs?

Industries such as technology, banking and financial services, healthcare, manufacturing, retail, telecom, and automotive commonly leverage GCCs and ODCs.

What locations are popular for setting up GCCs and ODCs?

Popular locations include India, Eastern Europe, Southeast Asia, Latin America, and the Philippines due to strong talent pools and cost advantages.

How long does it take to set up a GCC or ODC?

The setup timeline can range from a few weeks to several months, depending on factors such as location, scale, infrastructure requirements, and governance model.

Is a GCC or an ODC better for long-term growth?

A GCC is generally better for long-term strategic growth and innovation, while an ODC is ideal for rapid execution, flexibility, and short- to medium-term technology needs.

How do GCCs and ODCs help with cost optimization?

They reduce costs by leveraging lower labor expenses, optimizing resource utilization, minimizing infrastructure investments, and enabling round-the-clock development through time-zone advantages.

How is data security and IP protection handled in GCCs and ODCs?

Data security is ensured through strict compliance frameworks, secure infrastructure, access controls, legal agreements, and adherence to international standards such as ISO, SOC, and GDPR.

AI Ethics & GCC Compliance Mandates 2025 Guide

In one case, a Global Capability Centre (GCC) team in Bengaluru stopped a profitable AI rollout last month after internal audits revealed inconsistent performance across customer segments. The suspension provided an opportunity to both lose and gain time. The latter decision reflects a new reality: GCCs will not be required to adhere to AI ethics and compliance in 2025, but as a matter of strategy, they will be able to achieve scale, reputation, and economic value.

The Moment: Data and Growth

The Indian GCC market is both vast and expanding; over 1,900 GCCs work in India, generate about USD 64.6 billion in revenue, and involve almost 2 million professionals. By 2030, analysts estimate that the GCC number in India will grow significantly to 3500 led by AI and research and development requirements imposed by multinational corporations. These centres are the main engines of execution of enterprise AI; therefore, the governance stakes are not localised.

Meanwhile, regulators are coming to agreements on AI standards.

The EU AI Act is already in effect and implementing obligations (with key provisions taking effect until 2026-2027), raising the compliance threshold of any GCC building product or service offered in Europe. In addition to this, the national legislations on data, like India’s Digital Personal Data Protection Act (DPDP Act, 2023), demand cautious data management and mapping across borders. The combination of these rules implies GCCs will have to design multi-jurisdictional controls and not as an add-on.

Economic Benefit

Responsible AI cuts the financial, operational and reputational risk, and it opens up the possibility of growth. Companies that have made compliance a part of model lifecycles do not face the cost of remediation, regulatory fines and delayed entry into the market.

In addition, GCCs with certified governance capabilities receive more valuable mandates from HQ (core product development, generative AI experimentation, and intellectual property creation), generate more revenue per centre, and improve talent retention.

Other international research also indicates that the companies that invest in AI governance achieve higher deployment speed and increased stakeholder confidence, an economic multiplier when implemented through hundreds of GCCs.

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What GCCs Need To Do in 2025

The following are brief requirements that all Global Capability Centres should observe this year:

Compliance Area	Required Implementation	Business Rationale
Governance & Accountability	AI governance charter; role-based accountability matrix; AI register	Secures ownership in the model lifecycle.
Cross-border Data Controls	DPIAs, data-Mapping, encryption, RBAC, and legal means of transfer.	Compliant with DPDP and foreign transfer requirements.
Bias & Fairness	Bias tests periodically, explainability records, fairness dashboards.	Minimises the risk of discrimination; exceeds the high-risk AI regulations.
Model Monitoring	Drift detection, human-in-the-loop gates, retraining SLAs	Ensures model accuracy and safety of operation.
Vendor Risk	Third-party AI assessment, SLAs, security attestations	Manages exposure of control supplier and supply risk.
GenAI Safety	Timely governance, mitigation of hallucinations, provenance, logging.	It eliminates IP leak and false information
Incident & Audit Readiness	Audit Playbooks Traceable logs, audit kits, regulatory notification.	Shortens time-to-respond for regulators and clients

Personas and Practical Roles

DPIAs and explainability are managed by AI product managers, transfers and consent are mapped, engineering pods integrate monitoring and retrain pipelines, and legal teams handle regulatory submissions. HR and L&D facilitate training programmes that enable governance to function.

Third-party and Regional Entities (UAE, EU, India).

GCCs working with APAC and MENA markets should also consider region-specific ethics frameworks and toolkits published by cities and states. This includes local UAE ethical standards as well as national AI policies that emphasise human-centred design. In the case of GCCs that favour Europe, EU AI Act schedules and classification regulations must be considered when developing products and selecting vendors.

The Vision Of Success

By 2026–2027, the major GCCs will possess independent AI audit departments, interactive compliance dashboards, and RegTech integrations to execute continuous conformity assessments. These GCCs will become strategic hubs by attracting more valuable work, reducing external audit friction, and making compliance a talent magnet.

Conclusion

AI compliance and AI ethics are business requirements in 2025 in the GCC. Governance centres that treat governance as infrastructure, documented, automated, and accountable, will not only avoid the stigma of regulation but will also claim the new and more lucrative responsibilities that businesses are outsourcing. There is only one way to become a GCC leader: first, develop trustworthy AI, and then reap the benefits of profits, stability, and reputation.

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frequently asked questions (FAQs)

Who are the Pharma GCC development leaders in India?

Hyderabad, Bangalore and Pune have become significant pharma innovation centres with global delivery centres of major biotechnological and pharmaceutical firms such as Novartis, Pfizer, AstraZeneca and GSK.

Which economic benefits do Pharma GCCs have?

They offer an economic benefit of calculation, a variety of scientific and technical human resources, and speedy time-to-market. On average, businesses reduce between 25-40 percent of the operational costs and increase the rate of innovation.

Which technologies are influencing Pharma GCC operations nowadays?

The next-generation operations of Pharma GCC focus on advanced molecular modelling, AI/ML-based drug discovery, cloud supercomputing, and data integration platforms, as well as quantum-ready simulations.

What is the role of AI in Pharma GCC processes?

Pharma GCCs use AI to screen molecules, predict the efficacy of drugs, optimise clinical trials and aid in making data-driven decisions, resulting in smarter, faster and safer drug pipelines.

How will Pharma GCCs look in five years to come?

Pharma GCCs will be global innovation ecosystems that are a combination of computational chemistry, generative AI, and quantum computing. They will turn into the hubs linking data science, discovery and regulatory intelligence in the global arena.

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Aditi

Aditi, with a strong background in forensic science and biotechnology, brings an innovative scientific perspective to her work. Her expertise spans research, analytics, and strategic advisory in consulting and GCC environments. She has published numerous research papers and articles. A versatile writer in both technical and creative domains, Aditi excels at translating complex subjects into compelling insights. Which she aligns seamlessly with consulting, advisory domain, and GCC operations. Her ability to bridge science, business, and storytelling positions her as a strategic thinker who can drive data-informed decision-making.