PolicyGuard: From Organizational Policies to Neuro-SymbolicCompliance Review Engines

LLM agents handle user requests on behalf of organizations through tool calls and must follow the company policies stated in their system prompts. Prior work approaches this as a safeguarding problem -- external checks that block non-compliant agent actions. We argue that policy adherence is a broader problem: real workflows unfold across many turns, require explicit user confirmation and prerequisite reads, and hinge on the content of the dialogue rather than on any single argument value. Meeting this bar requires (i) full conversation context, (ii) self-reasoning over the policy and the current dialogue, and (iii) conversation-specific remediation that guides the agent's next turn -- three capabilities that prior safeguard work has often underestimated. We introduce POLICYGUARD, a sub-agent verifier that shares the agent's view of the dialogue, reasons over the policy in context, and provides actionable feedback for the agent's next turn. On tau^2-BENCH airline across three vendors (GPT-5.4, Claude Sonnet 4.6, Gemini 2.5 Pro) with four trials per setting, POLICYGUARD improves PASS4 by +12.0 / +6.0 / +12.0 pp. Per-call analyses show POLICYGUARD achieves higher policy-violation recall while blocking roughly half as often as argument-level guards.

Access control policies are reliability-critical configuration artifacts in cloud systems, yet administrators frequently struggle to verify that a policy permits exactly what they intend. This verification gap cannot be remedied by using LLMs to synthesize policies: we find that reasoning and non-reasoning LLMs fluently explain policy behavior but cannot reason about policy semantics with reliability-grade precision, even when the specification is the LLM's own explanation. We formulate this impasse as the Verifiable Synthesis Paradox: the verification gap persists regardless of how the policy was authored. To remedy this, we introduce PolicySummarizer, a neurosymbolic tool that pairs finite-state automata with an LLM-based simplification to generate precise human-readable characterizations of requests allowed by a policy. PolicySummarizer uses model counting to guarantee the fidelity of the generated characterization by rejecting characterizations that fall below a user-configured threshold in favor of the formally derived one. On 546 AWS, 100 Microsoft Azure, and 100 Google Cloud Platform policies, PolicySummarizer achieves a mean similarity score of 0.93 and a 2.7x improvement over an SMT-based baseline. In a user study, PolicySummarizer raised policy-change-review accuracy from 39% to 93% on the hardest sub-task while reducing self-reported mental demand. We release PolicySummarizer as an open-source tool.

Reasoning-based LLM guardrails improve safety moderation by generating explicit rationales before issuing final decisions. However, their rationales do not always lead to faithful enforcement: a model may recognize a harmful intent in its reasoning but still predict a safe label, or issue an unsafe decision without policy-grounded justification. We identify this safety-critical failure mode as the deliberation-to-enforcement gap. Unlike general chain-of-thought faithfulness, guardrail reliability requires policy execution consistency: the generated reasoning should be grounded in the safety policy, and the final decision should be entailed by that reasoning. We propose ConsisGuard, a consistency-aware framework for reasoning-based LLM guardrails. ConsisGuard performs Policy-to-Decision Trajectory Distillation and Functional Coupling Alignment, aligning the internal coupling between safety deliberation and decision enforcement. Experiments on prompt and response harmfulness detection benchmarks show that ConsisGuard improves detection performance while reducing policy execution failures. These results suggest that reliable reasoning-based guardrails require accurate faithful execution of safety policies.