Future-Proofing the Board with AI

Artificial intelligence (AI) can revolutionise boardrooms in today’s rapidly evolving business landscape. Still, this rapid change threatens to distance boards from the companies they serve if proper care is not taken in implementing both the technology and the governance around it.

In this podcast, Dr. Sabine Dembkowski, Founder and Managing Partner of Better Boards, discusses how AI can revolutionise boardrooms with Moya Hayhurst, a Fellow of the Chartered Governance Institute with over 25 years of experience in corporate governance across multiple industries, including mining, financial services, and insurance. She has a proven track record of leveraging technology to ensure that governance functions operate efficiently and meet the business’s needs. Her recent experience includes navigating Structural Reform at Barclays Plc, building agile teams at Royal London, and leading the governance transformation at Canopius. She is currently part of the Centre for AI in Board Effectiveness (CAIBE) research team, whose mission is to progress AI’s role in board effectiveness and help board ecosystems adapt.

“If we go back to the beginning as to why boards were created, they’re there to protect and drive the value of companies.”

Moya notes that many boards are currently facing the same issues and hearing the same requests, questions, and concerns from employees and stakeholders. People want to know how AI will impact their jobs in the future or if their jobs will even exist in the future. Boards have a significant role to play in that discussion, but to lead the debate about future-proofing effectively, boards need to absorb and process a vast amount of information. It’s a serious challenge, especially given that many people serve on multiple boards and need to help various types of companies develop an appropriate response to AI.

“The real value from AI and similar is about integrating into the ethos of the company and the core infrastructure, and whether we like it or not, whether executive boards, executive committees and such acknowledge it, the board is a key component of that.”

Moya is currently involved in a voluntary project with the Centre for AI in Board Effectiveness (CAIBE), which aims to get boards excited and engaged with AI as a tool for improving their effectiveness and the quality of their conversations.

To Moya, in an ideal future state, board members and directors will be able to be more effective by having AI bring forward the data and information they need, when they need it, in easily digestible formats. Currently, boards are overwhelmed with data, and key conversation points are being overlooked.

Imagine, instead, board members with a customised AI system at their fingertips, trained on curated datasets such as the current meeting pack, board history files, the company’s history, past meeting packs, and meeting minutes reports. As they prepare for meetings, board members can review the current agenda and pose various situations to the AI system using natural language questions. In a matter of moments, they could have summaries, links to key data points, and cross-references of past discussions. This would create more time for meaningful conversations and provide the tools to drive them forward, as well as offer the kind of strategic guidance companies expect from their boards.

“Some boards are further along than others.”

Moya realises this is a leap forward. It wasn’t that long ago that boards were reticent to use board pack technology. They wanted their hard copies printed and couriered to wherever they were in the world, whereas now 90% of boards walk into a boardroom with an iPad. It’s an evolution in progress.

However, Moya doesn’t believe it needs to be complicated. Innovation and tradition can coexist comfortably. In her experience, when knowledgeable people guide innovation, its true potential can be realised.

“Through an interface like AI, you can bring the board back in alignment with the company.”

To Moya, what AI is surfacing is not that different skills are needed in the boardroom. The boardroom is already full of incredibly skilled people, but those people are struggling with the data coming at them, and thanks to the time it takes to prepare board papers, not all of that data is up to date. Backward-looking reporting, requiring wait times for follow-ups, and similar delays are leading to missed opportunities and instances where the board is not operating at the same pace or on the same page as the business.

AI can help bring the board back in alignment with the business in terms of tempo and transparency of operations. This then unlocks the real value of the board – its ability to provide critical thinking, strategic insights, and guidance.

“AI is a toddler. They are excited, energetic, and bring such amazing potential, but they’ve got to have guardrails so that they grow up in the right way.”

Moya understands that boards have concerns about new technology tools and their security, as well as the protection of sensitive information. Fortunately, most organisations have a governance framework in place to strike a balance between responsibility and innovation. She thinks of AI as a toddler loaded with energy and potential but in desperate need of guidance and thoughtful training. Boards can collaborate with cybersecurity teams and governance to establish the right guardrails and training protocols for their AI tools, ensuring both adequate inputs and desirable outcomes.

The three top takeaways for effective boards from our conversation are:

• Trust the professionals on your team. Lean on governance professionals and IT professionals to help you investigate the technology and offer better intelligence for quicker decisions.
• Don’t be hamstrung by perceived risk. Think through it carefully, and then quantify and manage the risk so that you can empower and engage your directors and your company to really be at the forefront of your industry.
• You must have a clear plan that understands the risk and governance frameworks of your organisation and its sensitive data, and that ensures your guardrails are in place. In this way, you can leverage all the potential and unlock the excitement and opportunities again, but in a thoughtful, risk-averse, ethical, and responsible manner.

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