This is Part IV of a 4-part series. For a comprehensive understanding, read the full whitepaper here.
The Board Dimension
AI is already impacting core Board governance functions, such as strategy, risk management, financial stewardship, and regulatory compliance. If there is any doubt about the seriousness and sense of urgency, we need only look at the recent drama surrounding Disney’s shareholders who have requested disclosure of the company’s use of AI and board oversight in the company’s 2024 proxy materials. Unsurprising, AI is now a regular Board topic. Audit committees seek to understand and monitor how AI is used in company’s systems of internal controls and if used to prepare or audit financial statements. Compensation committees seek to understand if and how AI may be used for recruiting or in wider human capital management or HR practices. Risk committees ask the management how AI is exacerbating or mitigating existing risks such as cyber, political, supply chain, litigation, and the regulatory environment. In many cases it urgently seeks to understand where and how AI is already used by existing vendors in their existing services and applications.
Author: Tony Leng
Please feel free to contact Tony Leng directly via email tleng@hiec.com should you have any questions or would like to discuss the above or anything else further.
This is Part IV of a 4-part series. For a comprehensive understanding, read the full whitepaper here.