By Chisom Obiudo
As a board director, do you find yourselves wading through hundreds of pages in board packs, struggling to identify the key insights necessary for strategic decision-making?
The growing complexity of governance and increasing regulatory demands often press directors for time, forcing reliance on dense, manually prepared information. This can lead to decision fatigue, overlooked risks, and missed opportunities.
Recent technological advancements, particularly generative AI, offer practical solutions to these challenges. Boards can now rely on tools that reduce administrative burdens, deliver concise insights, and improve their engagement with data.
While AI offers significant benefits, its integration into governance processes carries risks and requires robust oversight and a well-defined strategy.
This article outlines what generative AI is, its potential in the boardroom, and key governance considerations for its responsible use.
What Is Generative AI?
Generative AI refers to machine learning models capable of creating new content such as text, images, audio, and simulations based on patterns learned from existing data. In simple terms, AI analyses large datasets to identify trends, recurring themes, and relationships, enabling it to generate outputs that are relevant and tailored to specific needs.
In a corporate governance context, AI can analyse large datasets to identify patterns like common language in board reports, recurring financial trends, risk indicators, and governance themes.
This enables it to produce outputs tailored to the organisation’s specific industry and governance processes, such as synthesised insights, predictive analytics, and contextual recommendations aligned with organisational priorities.
These patterns help AI summarise board materials, highlight key risks, suggest agenda items, and monitor regulatory changes. By recognising these patterns, AI reduces administrative burdens and supports directors in making more informed, data-driven decisions
Familiar tools such as ChatGPT, Claude, and Gemini generate written content, while DALL-E and Midjourney create images from text prompts. These technologies are no longer limited to marketing or customer engagement; they have practical applications in governance, compliance, and decision support.
Practical Applications of Generative AI in the Boardroom
Generative AI has the potential to improve board effectiveness and decision-making in several key areas:
1. Meeting Preparation and Documentation
Agenda Creation: AI can analyse previous meeting materials and upcoming priorities to suggest customised board agendas, saving time and improving focus.
Minutes and Summaries: AI-powered tools can transcribe meetings and generate accurate summaries, allowing directors to focus on discussions rather than documentation.
Document Management: Generative AI can organise and make board materials such as charters and policies easily searchable and accessible.
2. Strategic Decision Support
Scenario Planning: AI helps directors simulate potential future outcomes and evaluate strategic options more effectively.
A recent Harvard Business Review article titled, “Use Generative AI to Improve Scenario Planning,” highlighted how generative AI transformed traditional scenario planning by addressing inefficiencies. AI-enabled organisations can process vast datasets, identify trends, and generate actionable scenarios quickly and cost-effectively.
The article outlined improvements in:
Scenario Creation: Drafting plausible scenarios and filtering out irrelevant ones.
Narrative Building: Crafting relatable narratives to help stakeholders better engage with different scenarios.
Strategy Development: Proposing tailored strategies based on specific challenges.
One example highlighted a company using AI to address supply chain risks and workforce gaps. By processing complex data, the AI proposed strategies such as retraining staff and outsourcing expertise, enabling the board to explore solutions faster and in greater depth. Importantly, human judgment remained essential in refining and implementing these strategies.
Risk Identification: AI can flag emerging risks such as regulatory changes, cybersecurity threats, or reputational risks, providing a proactive approach to risk management.
Skills Gap Analysis: AI can assess directors’ skills and compare them to the organisation’s strategic needs, offering insights for recruitment or training.
3. Real-Time Insights and Data Analysis
Trend Analysis: AI tools can analyse industry trends and market shifts, providing timely insights for strategic planning.
Executive Summaries: AI can distil complex management reports into concise, actionable summaries, helping directors focus on the most critical information.
Compliance Monitoring: AI can track evolving regulatory requirements and flag potential non-compliance issues, reducing legal risks for the organisation.
Governance Implications and Oversight Considerations
While generative AI offers significant advantages, boards must establish strong governance frameworks to ensure responsible use. Directors should focus on three key areas.
Developing an AI Strategy
AI initiatives must align with the organisation’s overall strategy. Boards should identify areas where AI can add value, such as improving efficiency or enhancing risk management, and set clear objectives.
Building AI Literacy
AI literacy is increasingly important. While directors do not need to become technical experts, they must understand AI’s capabilities and risks to oversee its implementation effectively. Ongoing education and recruiting technology-savvy board members can help bridge the knowledge gap.
Managing Risks Proactively
Boards should establish clear policies for AI use that address key governance priorities:
Ethical Considerations: Boards must ensure that AI systems promote fairness, accountability, and transparency. Regular audits can help detect and correct biased outcomes.
Data Privacy and Security: Compliance with applicable data protection regulations and robust cybersecurity protocols are critical. Regular risk assessments will help identify vulnerabilities and ensure data is handled securely.
Continuous Monitoring: AI systems should be continuously reviewed for performance and compliance. Collaboration with internal audit teams, IT departments, and external experts can help boards maintain effective oversight.
By managing these risks proactively, boards can mitigate potential pitfalls and strengthen organisational resilience.
Generative AI is a practical tool that has the potential to transform how boards operate, offering new ways to improve efficiency, decision-making, and risk oversight. However, integrating this technology requires thoughtful governance and a clear strategy.
Boards that adopt AI proactively will be better positioned to navigate an increasingly complex business environment and seize emerging opportunities. Those that fail to engage risk being left behind, constrained by outdated processes and slower decision-making.
It is important to emphasise that AI is not a replacement for board expertise and strategic judgment. Rather, it serves as a powerful tool to augment directors’ decision-making capabilities, providing data-driven insights and reducing administrative burdens. Ultimately, it enhances governance practices while allowing directors to focus on high-level strategic oversight.
The role of the board is evolving. Generative AI is not a trend but a valuable part of the modern governance toolkit. Now is the time for directors to familiarise themselves with AI—not as technology experts, but as strategic leaders capable of guiding their organisations into a future defined by innovation, agility, and data-driven decision-making.
In my next article, I will explore how board directors can engage directly with generative AI tools, providing sample prompts and practical insights to enhance governance practices.
*Chisom Obiudo is an admitted legal practitioner and corporate governance trainer. She serves as a Chief Legal Officer and researcher at the Namibian Law Reform and Development Commission, focusing on law reform, policy, and legislation. Chisom holds a master’s degree in Corporate Governance and certificates in Non-Executive Directorship, AI Professional Skills, AI and the Rule of Law, and Legislative Drafting. She writes in her personal capacity. Reach her at chisomokafor11@gmail.com.
