What Web Grounding in Microsoft 365 Copilot Really Means for Security—And What to Do About It

Skeet Spillane
6 days ago
4 min read

(Revised as of February 5th, 2026)

If you’re now responsible for AI risk, even if you didn’t ask for it, this one’s for you.

A Cross-Industry Data Governance Risk, With High Stakes for Healthcare

Microsoft Copilot is becoming part of everyday work across nearly every industry. Teams use it to draft emails, summarize meetings, research regulations, and find answers faster.

One Copilot feature deserves closer attention from security, privacy, and compliance leaders:

Web grounding.

Web grounding can be useful. It can also introduce a new and often misunderstood data governance risk. This risk applies across industries, but regulated environments like healthcare feel the impact most clearly.

Key Facts at a Glance

Web grounding allows Copilot M365 to pull information from the public internet through Bing.
When enabled, parts of a user’s prompt may be processed outside the Microsoft 365 tenant.
This changes data boundaries, not just answer quality.
The primary risk comes from user behavior and assumptions, not from Copilot itself.
Regulated industries such as healthcare face additional legal and compliance exposure.

What Is Web Grounding?

Web grounding is a Copilot feature that allows Copilot M365 to use public internet sources to improve responses.

Instead of relying only on content inside your Microsoft 365 environment, Copilot can also reference:

Recent news
Vendor announcements
Regulatory updates
Public research and industry information

This makes Copilot more current and more helpful for many use cases.

It also changes where part of the request is handled.

Why Web Grounding Matters Across Industries

In a standard Microsoft 365 Copilot experience, prompts are processed within the organization’s tenant, using the data the organization already controls.

Web grounding introduces a different pattern.

When web grounding is enabled, Copilot may send part of a user’s request outside the tenant to perform a web search, then return results to generate an answer.

This is not a flaw. It is how the feature works.

The risk emerges when organizations assume Copilot always behaves like an internal system, while users interact with it as if it were private and contained.

That assumption gap creates governance risk across industries.

Examples include prompts that contain:

Confidential business context
Strategic planning details
Financial or contract information
Internal personnel or HR data
Sensitive customer information

In practical terms, web-grounded Copilot prompts should be treated like public internet searches, even when they feel like an internal tool.

If you would not type it into a search engine, it should not go into Copilot when web grounding is enabled.

Healthcare Shows the Risk Most Clearly

Healthcare is not the only industry affected by web grounding. It is the industry where the consequences are easiest to see.

Healthcare organizations operate under strict regulatory and legal obligations. Many assume that if a tool is provided by Microsoft, it automatically falls under their HIPAA Business Associate Agreement.

Web grounding complicates that assumption.

Because web grounding involves external web search processing, it may fall outside the scope of what healthcare organizations expect to be covered under a BAA. This does not mean the feature is unsafe. It means the decision to enable it carries regulatory implications.

The real risk is not data leakage. The real risk is accidental misuse.

If users include sensitive information in prompts, such as:

Patient identifiers
Diagnoses tied to individuals
Scheduling or appointment details
Billing or insurance information
Internal employee data

The organization may create unnecessary compliance exposure without realizing it.

Healthcare highlights the issue because the margin for error is smaller, audits are more rigorous, and consequences are more personal.

This Is a Governance Issue, Not an AI Problem

It is important to be precise about what is happening.

Copilot is not leaking data.
Web grounding is not inherently dangerous.
Microsoft provides strong enterprise security and privacy controls.

The issue is governance.

Web grounding changes data handling boundaries. That change must be understood, documented, and managed like any other data flow decision.

Treating it as a simple productivity toggle is where organizations get into trouble.

Controls Exist, but Configuration and Training Matter

Microsoft has built meaningful controls into Copilot M365, including:

Audit logging of prompts
Integration with Microsoft Purview
Sensitivity labeling support
Data loss prevention policies

These are real advantages compared to consumer AI tools.

They only work if organizations configure them intentionally and train users to understand how Copilot behaves in different modes.

Technology alone does not solve this problem.

Practical Steps Organizations Should Take

Before enabling web grounding broadly, organizations should take the following steps.

Disable Web Grounding by Default
In many environments, web grounding should be opt-in, not automatic.

Limit Access to Lower-Risk Teams
If enabled, restrict use to functions such as marketing, communications, or non-clinical research.
Train Users with a Simple Rule
If you would not type it into a public search engine, do not type it into Copilot when web grounding is enabled.
Use Existing Compliance Tools
Leverage labeling, DLP, auditing, and monitoring to reduce accidental misuse.
Treat This as a Cross-Functional Decision
Web grounding should be reviewed by IT, security, privacy, legal, and compliance leadership together.

This is a governance decision, not a feature preference.

Bottom Line

Web grounding can make Copilot more useful and more current. It also introduces a meaningful change in how data requests are processed.

That change matters across industries.

Healthcare simply shows the risk more clearly, and with higher stakes.

Organizations that understand the boundary shift, set clear policies, and train users appropriately can use web grounding safely. Organizations that enable it casually may not realize the exposure until an audit, investigation, or incident forces the issue.

The difference is intentional governance.

Ready to Build a Safer AI Strategy?

Let’s talk about how to pilot Copilot—securely.

For more technical details into the risks and mitigation strategies, read the full white paper on The Security Implications of Web Grounding in Microsoft 365 Copilot.

How Pillar Helps

At Pillar, we help organizations deploy Copilot safely and responsibly by aligning governance, technical controls, and real-world user behavior. We work closely with regulated environments like healthcare, where mistakes carry legal and personal consequences, but our approach applies across industries.

If you are evaluating Copilot web grounding, we help you make the decision deliberately and implement it in a way leadership, auditors, and security teams can support.

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