Foundations of AI Governance

AI landscape

• AI is now inescapable. It is now everywhere.
• Typically, we are all exposed to AI using apps like Amazon Prime and Netflix. 
• AI hit the public landscape when OpenAI launched ChatGPT. In early 2022, it became much easier to use than it had been.
• AI is a computer system that does things for itself.
• Types of AI systems:
  • General AI
  • Narrow AI – AI has done this very well for the last few years
  • Composite AI – AI is now getting very good at doing this where AI can interact with other AI
• Think about AI in the same way you think about Microsoft Word or Google Docs i.e. it should be something you use every day.
• However, it’s still challenging to know at a strategic level what to do as a board.

Is your board ready?

• How often do you use AI yourself? The answer signifies the level of unknown.
• Does your board have an approved AI policy in place? Research suggests that a lot of boards do. 
  • When you’re creating it, do an audit internally to see who’s using AI internally, what are they using it for, and how are they using it.
• 68% of directors don’t have a board-approved AI policy (source: IoD Ireland, 2024).
• 75% are not aware of the scope of the new EU legislation on AI.
  • EU AI Act is one of several in the EU
• 41% aren’t aware of their own personal liability for severe organisational non-compliance with cybersecurity rules.
• 36% see AI as a key tool for improving operational efficiency and competitiveness.
• 26% are experimenting with Generative AI.
• 60% of Irish directors/senior executives still don’t use AI in any way in their organisations.

AI and the role of the board

• In Australia, the legal obligations when using AI include:
  • Privacy, IP and data use
  • Consumer protection
  • Cyber security
  • Anti-discrimination
  • Duty of care/diligence
  • Work health and safety
• Risks to organisations from AI use to consider:
  • Commercial: commercial losses due to poor or biased AI system performance
  • Reputational: Damage to reputation and loss of trust due to harmful or unlawful treatment of consumers, employees or citizens
  • Regulatory: Breack of legal obligations
• Key sources of AI risk for organisations
  • AI system failure: poor system performance, biased system performance
  • Malicious, misleading, reckless or inappropriate use: misleading advice, misinformation at scale, weaponisation, AI-powered cyber attacks
    • Testing is important. 
    • Agile is a great approach for this to test as you go.

Strategic awareness questions to ask at the board:

• How is AI currently used in the company and its competitors
• How AI may disrupt the company’s business and industry.
• The strategic implications and risks associated with AI products and services.
• The impact of AI applications on the workforce and other stakeholders.
• The implications for compliance with legal, regulatory, and ethical obligations.
• How is/should AI be used to support the delivery of the organisational strategy and related business goals?
• The governance implications of the use of AI and related policies and controls.

Strategic alignment questions to ask:

• How is AI currently being used to deliver our business goals?
• What investments are we making in relation to the development and use of AI systems?
• How can we leverage AI in a responsible way to achieve our organisational strategy?
• What sorts of problems and challenges can or should AI systems be used to solve?
• Under what circumstances would we conclude that AI is not the right tool for the job?
• What is our overall assessment of the evolving balance between the risks and benefits of AI systems to drive business value?

AI & strategy

• AI is transformative & disruptive, boards need to consider:
  • How AI is currently used:
    • Which departments use it, and how is it being used?
    • What are the reasons, objectives and metrics for using it?
    • What are the guardrails to protect data integrity, and bias?
  • See what your competitors/other organisations are doing with AI

• Opportunities: Explore how AI can help achieve objectives, create new products/services
• Disruption: Consider AI’s potential to disrupt industries, business models
• Know the risk: AI is data-dependent
• If you’re going to hire AI-skilled staff, you need to have the data infrastructure in place. Data is key to using AI effectively.

AI is impacting every organisation, across every level. Getting it right at boardroom level makes its implementation and adoption effective throughout the organisation.In this webinar, delve into the opportunities AI presents and develop the knowledge to engage in meaningful conversations about AI and its strategic significance.

• Key technologies include machine learning, neural networks and generative AI.
• AI-driven opportunities, from operational efficiencies to data-backed insights.
• Strategies to address AI risk management considerations, such as bias and data privacy.
• Understand the board’s responsibility in setting the strategic direction for AI initiatives and ensuring alignment with the company’s long-term objectives.

How you’ll apply your learning

• Gain a foundational understanding of AI technologies and how they are applied in business settings.
• Learn how AI can be leveraged to enhance organisational efficiency, make data-driven decisions and improve operations across various industries.
• Recognise the ethical, regulatory and operational risks that come with AI, such as bias, discrimination and data security concerns​.

Global spend on Digital Transformation will exceed $3.4T in 2026 yet 70% of Digital Transformation projects fail to achieve their goals. Robert is on a mission to develop the next generation of digital leaders who can tackle digital transformation in an AI world.

Robert leads an MSc in Digital Transformation, is a board member of the Compliance Institute, writes insightful articles on digital transformation and AI and delivers thought provoking lectures/webinars. Robert has trained audiences in North America, the middle east and Europe including Google, HubSpot, Citibank, GE, DocuSign, BT, Almarai and many more. He designed Ireland’s first digital marketing apprenticeship and designed the ‘Digital That Delivers’ industry training program for Failte Ireland.

Roberts holds a masters in strategic management, postgraduate qualifications in digital transformation and education and undergraduate qualifications in digital, cyberpsychology and marketing. Finally, Robert was nominated for the Net Visionary award in 2017.

Connect with him for the latest industry news and best practices.
Website: www.DigitalTransformationInstitute.ie
Podcast: Search ‘Digital Transformation Institute’