With an emphasis on important ethical aspects, this study investigates the connection between students' academic achievement and the Artificial Intelligence (AI) Ethics and Compliance Model. It's crucial to comprehend how AI technologies like ChatGPT and Baidu (China’s version of ChatGPT) conform to ethical standards given their growing usage in educational settings. Student privacy, data governance, fairness, accountability, transparency, explainability, and reproducibility are among the dimensions of the AI Ethics and Compliance Model that are being looked at. These dimensions were picked in order to evaluate how the AI ethical practices affect students' attitudes and actions, which in turn affect their academic performance. Three hundred and thirty-five students from two universities in Xinjiang, China, participated in the study by answering a questionnaire. Students' opinions on the ethical behaviour of AI systems and their personal obligations when utilising these tools were revealed by the data collected. The findings demonstrate students' favourable perceptions of all ethical dimensions and show that mean ratings for dimensions like explainability (4.417) and student accountability (4.413) are high. Students usually believe that employing AI tools has improved their academic performance, as evidenced by the mean score of 4.510 for self-evaluated academic achievement. Only student privacy was identified as a statistically significant predictor of academic achievement (p = 0.033) among the six variables that were analysed, according to the regression analysis. According to this positive relationship (B = 0.229), students are more likely to give their academic achievement higher ratings when they believe that privacy requirements are being upheld when they use AI tools. According to the findings, ethical compliance supports improved academic performance and increases students' faith in AI, which emphasises the necessity of ongoing evaluation of AI tools in educational institutions. This study recommends that universities must enhance AI tool privacy, promote transparency, encourage responsible usage, and train students on ethical guidelines to prevent misuse and ensure academic integrity. KEY WORDS: AI ethics, student privacy, data governance