The board’s role: Evaluate the integration of the company’s AI approach to its broader corporate strategy. Oversee strategy execution, and help management identify when and how the strategy may need to be adapted in response to AI risks and opportunities.

The board can work with management and oversee the following:

• Vision and mission: Define and uphold the organization’s vision and mission statements, confirming they align with the strategic goals of the organization and the potential of AI.
• Strategic planning: Uphold an iterative process of monitoring management’s implementation of the AI strategic plan, identifying core business processes that will be most affected by AI.
• Stakeholder engagement: Maintain transparent communication and engagement with shareholders, employees, customers, and other stakeholders regarding the use and governance of AI.

The board’s role: Understand and oversee the risks AI poses to the company’s overall strategy. Consider these risks within the organization’s enterprise risk program and monitor how AI can impact existing enterprise risks.

The board can work with management and oversee the following:

• Risk appetite and tolerance: Define the organization’s risk appetite and tolerance levels, confirming they align with strategic objectives and the potential risks of AI.
• Monitoring and reporting: Management should monitor risks and report on risk management activities to the board, promoting transparency and accountability. Depending on the level of third-party involvement, implement a process to track and monitor third-party service providers and understand how they fit in to addressing AI-related risks.
• Risks of inaction: Management should assess the risks associated with not implementing AI and the costs of lagging behind AI expertise and implementation of market peers.

The board’s role: Understand the significance of the board’s own governance of AI, which includes its governance structure, board composition and refreshment, continuing education, and board self-assessments.

The board can work with management and oversee the following:

• Governance framework: Develop and uphold a comprehensive governance framework, which will outline how the organization will use AI, and define the purpose and objectives of proposed AI initiatives across the organization.
• Oversight roles: Assign oversight responsibility to the respective governing body or bodies, either at the board level or specific committee(s) based on management’s strategy for AI utilization.
• Leadership and management structure: The board should understand who in management “owns” the AI strategy and if there is a need for an AI management committee or working group to lead the enterprise-wide AI strategy.
• Board skills matrix: Identify board candidate skills that would support effective oversight of AI and assess gaps in the current board composition.
• Board refreshment: Ensure the board has a process for effective board refreshment, including an effective board assessment process.
• Onboarding and education: Embed AI education in new director onboarding, and continually include technology and AI as topics the board should be briefed on through a continual education program for directors.
• Board assessment: As part of the board’s periodic self-evaluation, consider assessing the alignment of director skill sets and AI priorities.

The board’s role: Monitor the company’s progress against its AI-specific goals. Understand how AI supports or inhibits progress toward the company’s overall strategic goals. Establish a consistent method for receiving, reviewing, and utilizing the data used to evaluate progress.

The board can work with management and oversee the following:

• Continuous improvement: Cultivate a culture of continuous improvement and innovation, fostering long-term success, and helping to ensure AI is adopted effectively, efficiently, and responsibly.
• Strategic performance: Assess progress toward strategic goals, making necessary adjustments to align with AI implementation targets.
• Financial performance: Review budgets and financial forecasts pertaining to investments made for AI.
• Operational performance: Monitor key operational metrics to evaluate efficiency and effectiveness. Additionally, track and monitor AI implementations by third-party vendors, as applicable.

The board’s role: Assess whether the skills needed to execute the company’s AI strategy and manage risks are adequately represented among management. Understand impacts and opportunities AI brings to the workforce and how AI is integrated into recruitment, workforce development, and incentive strategies.

The board can work with management and oversee the following:

• Three lines of defense model: Adopt or adapt a model to enable the organization to incorporate various skill sets into effective oversight, evaluation, and monitoring of AI applications and underlying models.
• Leadership development: Identify and develop current and future leaders within the organization to help ensure a strong leadership pipeline with a focus on technology and AI competencies.
• Talent upskilling: Implement a learning curriculum to educate employees on AI capabilities, limitations, ethical considerations, and best practices. Also, provide employees with opportunities to expand their skills in AI such as workshops where employees can practice using AI tools in a controlled environment.
• Talent acquisition: Oversee the recruitment and retention of top talent to help ensure the organization attracts and retains skilled employees with expertise in technology and AI.
• Performance management: Implement effective performance management systems to evaluate and develop employees, emphasizing the importance of technology literacy and AI skills.

The board’s role: Uphold trustworthy and responsible AI use in alignment with the ethical standards of the company.

The board can work with management and oversee the following:

• Ethical leadership: Lead by example, promoting ethical behavior at all levels of the organization, especially in the deployment and use of AI.
• Incentive and reward systems: Align the organization’s use of AI with its core values and incentive/reward systems.
• Code of conduct: Establish and enforce a code of conduct that outlines expected behaviors and ethical standards, including those related to AI.
• Cultural alignment: Establish mechanisms to monitor how the company’s AI strategy affects its reputation among the workforce and external stakeholders.
• Whistleblower policies: Implement mechanisms for reporting unethical behavior, including related to AI use or development, without fear of retaliation, helping ensure accountability.
• Compliance mandates: Maintain oversight of the evolving compliance landscape, including requirements specifically related to AI governance, data privacy, and ethical AI use.