Why AI Risks Are Keeping Board Members Up at Night

At a recent bank board meeting, directors were treated to a surprise. They listened to the chief executive talk strategy—except it wasn’t actually the CEO talking. It turned out to be a voice-cloning model that was trained, using the CEO’s prior earnings calls, to generate new content. More boards are undertaking such staged exercises to better grasp the impact—and potential risks—of generative artificial intelligence, says Tariq Shaukat, CEO of coding company Sonar, who was briefed on the exercise but declined to disclose the name of the bank. “There’s a lot of risk [with AI] and they think they need to understand it better,” says Shaukat, who himself serves on corporate boards. Public company board members say the swift rise of AI in the workplace is an issue that is keeping them up at night. Some point to recent concerns around employees putting proprietary code into ChatGPT, companies using generative AI to incorrectly source content or worries about so-called hallucinations where generative AI produces false or inaccurate information. Adding to their nightmares, board members worry that they could be held liable in the event AI leads to company problems. In recent years, some legal actions from shareholders have focused on whether board members—not just executives—exercised sufficient oversight of company risks. Board members, or directors, sit a level above management. Their job is to take a more independent view of company oversight, from risk management to culture to hiring the next CEO. Emerging technologies have been both a boon and headache for companies. Now that AI is front and center, board members are on the front lines of making rules on where and how it should be used—guidelines that could be crucial to the course of the powerful and fast-evolving technology.

Full report : Company directors are trying to get a handle on artificial intelligence as its use soars, bringing potential productivity gains—but also raising the prospect of employee blunders.