A Board level understanding of AI and of the governance frameworks for its responsible and ethical usage is essential
May 15, 2023
The digital landscape is rapidly evolving and the integration of artificial intelligence (AI) has become critical in many different industries and areas. It has transformed the way things are done, enabling automation, providing data and insights which in turn helps businesses with effective decision making.
In April 2023, the UK Government published an AI White Paper on how it plans to regulate the use of AI. The Institute of Directors, which is a professional organisation for company directors, senior business leaders and entrepreneurs, released a ‘reflective checklist’ with the aim of providing boards with information about the level understanding required at Board level when it comes to the ethical use of AI. These are just some examples that show the importance of managing AI responsibly.
Board level understanding of AI is important to effectively implement its potential and mitigate risks. Boards therefore need to familiarise themselves with AI technologies that are relevant to their sectors and their potential impact on the Company’s strategic goals. This helps them to engage in thoughtful discussions, ask informed questions, and provide guidance on AI-related matters in the business. By incorporating AI expertise at the board level, organisations can make informed decisions that align with their long-term objectives and relevant stakeholder interests.
Similarly, responsible AI governance is a critical aspect of ensuring ethical and accountable AI usage. Boards need to collaborate with management and relevant stakeholders to establish good governance frameworks that guide AI development, deployment and ongoing monitoring. These frameworks should emphasise transparency, fairness, accountability, and the mitigation of potential biases. By implementing responsible AI governance practices, organisations can build trust internally and externally, protect against reputational risks, and comply with applicable principles.
Implementing effective board level AI understanding and governance may come with challenges, as is often the case when change occurs. Boards must therefore navigate the complex and rapidly evolving AI landscape, staying informed about the latest developments and best practices. They need to balance between leveraging the benefits of AI within their sectors and managing the potential risks and ethical considerations. Additionally, organisations should prioritise continuous education and training for executive management and board members to keep up with AI developments and promote a culture of responsible AI usage.
Organisations and boards that embrace these principles will be better equipped to leverage AI technologies for innovation and growth while mitigating risks and upholding ethical standards. By implementing governance frameworks, they can ensure responsible AI usage, earn stakeholder trust, and position themselves for long-term success in an AI-driven world.
AI is a relatively new, rapidly evolving phenomenon requiring specialist skills. Its importance and relevance to individual businesses will differ. Here are some steps all companies can take:
- Determine how AI can be of most benefit to the business
- Assess risks
- Develop an AI policy
- Appoint a champion, either on the Board or reporting direct to the CEO
- Monitor and review policy.
Should you wish to discuss any aspect of this article, please contact Yolanda Roach.