The Evolving Landscape of AI in Business 

 

No longer a futuristic concept, AI is a reality already impacting on businesses across various sectors. AI-powered technologies help automate tasks, analyze data, improve decision-making, enhance customer experiences, and drive innovation¹. This rapid adoption is driven by AI's potential to increase efficiency, support decision-making, and create new opportunities¹.

Across the business landscape, Artificial intelligence (AI) both brings unprecedented opportunities and significant risks. As AI integrates into various aspects of operations, the role of the board of directors in overseeing its implementation and mitigating potential risks is  increasingly critical. It is vital to develop the new duties and knowledge required for board members companies to effectively address the challenges and opportunities presented by AI.

 

Essential AI Knowledge and Skills Board Members Now Need 

 

The rise of AI necessitates a shift in the duties and knowledge required of board members.

 

Knowledge

 

To effectively oversee AI in their organizations, board members need to:

• Understand AI Concepts and Terminology
• Understand Data Privacy and Security
• Address Ethical Considerations in AI
• Evaluate Bias and Discrimination in AI Systems
• Crete an AI Governance Frameworks and Best Practices:
• Understand Risk Management for AI
• Understand AI's Impact on the Workforce and Society
• Study the Legal and Regulatory Landscape Surrounding AI
• Create an AI Strategy and Decision-Making
• Communication and Stakeholder Engagement

 

Skills

 

•  In addition to knowledge areas, board members should also develop specific skills relevant to AI oversight, such as:

• Create and Oversee IT Infrastructure
• Monitor Cybersecurity.
• Identify and Assess Risk Management
• Build Adaptability: to Address Rapid AI changes
• Wise Strategic Foresight
• Ethical Awareness to Promote Responsible AI  

New Duties for Board Members

 

With this knowledge and these skills, board members can fulfill the robust many duties related to AI, which include:

• Assess AI Opportunities and Risks
• Oversee AI Governance, including: Establishing an AI Governance Committee that oversees data privacy, bias and discrimination, transparency and job displacement; builds a learning culture, prioritizes key skill areas, allocated resources for development programs, institutes governance frameworks

• Evaluate AI's Societal Impact
• Support Transparent Communication
• Commitment to Inclusivity
• Promote Responsible AI Use
• Monitor AI Performance and Impact
• Stay Informed about AI Developments
• Engage with Management on AI Strategy
• Ensure Data Safeguards for ethical concerns, economic monopolization, digital divide
• Meet Legal and Regulatory Obligations

• Mitigate Bias
• Promote Transparency
• Protect Intellectual Property

• Maintain Authenticity
• Create and Uphold IEEE Ethical Guidelines

• OECD AI Principles
• Monitor AI performance and impact
• Stay informed about AI developments:
• Engage with management on AI strategy

 

Our Recommendations

 

To address the challenges and opportunities of AI, boards should:

• Create robust AI governance frameworks:  Provide a structured approach to managing AI risks, ensuring ethical use, and promoting responsible innovation.

• Consider AI expertise on the board: Evaluate the need for AI expertise on the board.

As AI continues to evolve, the role of the board in overseeing this technology will only become more critical. Board members must embrace continuous learning, engage in proactive governance, and prioritize ethical considerations to ensure that their organizations thrive in the age of AI.

• Engage a strong AI consultant to assist your board with the skills and knowledge development and new duties to build the competency needed for the organization.

HHBoardwise is most willing to assist you with your AI areas of support. Reach out any time to learn more. Our AI expert, Katrina can work with your board and management and provide extensive resources based on your specific needs.

References and Resources for More Information 

The Impact of Artificial Intelligence on Business | Snowflake, March 2, 2025, https://www.snowflake.com/trending/impact-artificial-intelligence-business/

Publicly Traded Life Sciences Companies and Artificial Intelligence, March 2, 2025, https://www.hoganlovells.com/en/publications/publicly-traded-life-sciences-companies-and-artificial-intelligence-disclosing-risk-factors

The impact of AI on business | MicroSourcing, March 2, 2025, https://www.microsourcing.com/learn/blog/the-impact-of-ai-on-business/

How AI Is Used in Business - Investopedia, March 2, 2025, https://www.investopedia.com/how-ai-is-used-in-business-8611256