Why Companies Need Smarter AI Handling in Their Top Ranks

What’s Up with AI in Company Big Decisions?

All over the world, companies are trying to figure out how to handle artificial intelligence (AI) when it comes to big decisions at the top. Carine Smith Ihenacho, who looks after rules and staying on the right side of the law at Norway’s giant $1.7 trillion sovereign wealth fund, says that the big bosses need to get smarter about AI. They need to make rules on how to use AI safely, keep things clear and open, and check for any risks properly.

Problems and Tips

Smith Ihenacho points out that all the top bosses need to understand how AI changes their game, not just leave it to the tech experts. She highlights that having clear rules about AI, checking risks, and being open about how AI is used are key steps.

Key Areas to Focus On

The wealth fund is pushing the companies it invests in, like big names Microsoft, Apple, Amazon, and Meta Platforms, to take AI seriously, especially in places like healthcare where AI can really change things for customers.

This is about why it’s super important for company leaders to be good at handling AI, focusing on making rules, managing risks, and keeping things transparent to make sure their strategies work well for the long haul.

FAQ on AI Governance at the Board Level

1. Why is it important for company boards to understand AI?
AI has a significant impact on how businesses operate and compete. If company boards don’t understand AI, they might miss out on important opportunities or fail to manage risks effectively. It’s crucial for boards to have a strong grasp of AI so they can make informed decisions, create clear policies, and ensure that AI is used responsibly.

2. What are the key areas boards should focus on when it comes to AI?
Boards should prioritize creating clear AI policies, conducting thorough risk assessments, and maintaining transparency in how AI is implemented. These focus areas help ensure that AI is used ethically and aligns with the company’s long-term strategy, particularly in high-impact sectors like healthcare.

3. How can boards ensure they are effectively governing AI?
Boards can enhance their AI governance by collectively improving their understanding of AI, rather than relying on a few experts. They should also engage in regular discussions about AI strategy, involve AI experts when necessary, and keep an open line of communication with stakeholders to ensure transparency and trust.

Sources Reuters