How should boards navigate this quandary as they advise organizations on both growth strategies and risk management related to AI? To explore this tension, the EY Center for Board Matters convened a series of conversations between a board member and a senior executive in London, Sydney, and San Diego. The leaders discussed AI’s implications for boards across three areas: building confidence, creating value, and augmenting human potential.
1. Building confidence in AI
Building confidence in AI is critical for boosting adoption and mitigating risk. This includes both compliance with existing regulations such as the EU AI Act, as well as proactively developing an effective organizational governance model.
Boards can set direction with a principles-based approach. Dave Wright, Chief Innovation Officer at ServiceNow, discussed how their board developed guidelines for the organization, including “being transparent in AI” and “[ensuring] AI was always in the service of people.”
Film participants discussed the need to find a balance in the tension between ethics, innovation and regulation, recognizing that too much regulation may stifle innovation.
2. Creating value with AI
Creating value with AI requires a culture of innovation and learning. Participants discussed the importance of empowering innovators to fail fast, and employees to use AI safely with guardrails.
3. Augmenting human potential in the boardroom
While AI will reshape work across the enterprise, its potential to augment human potential within the boardroom is less explored — and this was a key focus of the participants.
Firstly, it is critical for boards to develop expertise in AI to effectively oversee and use it. Caroline Silver, Non-Executive Director at Tesco, NFTS, and Intercontinental Exchange, emphasizes the value of off-sites that allow boards to take some time away from their routines and “deep dive into [a topic] to get us up the [learning] curve.”
David Whiteing, Non-Executive Director at Macquarie Bank, highlights the importance of a growth mindset. “If you start from a perspective of ‘I don’t know,’ you’re going to spend more time on your own personal growth, education and development.”
As overseeing AI requires diverse skill sets and involves diverse value drivers, boards will need to assess their composition. Organizations need technologists on their boards, regardless of whether they are in the tech sector or not. Advisory councils can also attract the perspectives of younger tech-savvy professionals, who may be less interested in becoming full time board members.
Summary
AI will be a critical growth driver in the years ahead, as it reshapes talent within organizations and disrupts business and operating models. Achieving this potential will require organizations to mitigate AI’s risks and build confidence in its use. To guide organizations through these transitions, boards need to focus on expanding their competencies and boosting diversity.
Read the full article by Sharon Sutherland, Beatriz Sanz Sáiz / EY
