Future proofing the board with AI | Moya Hayhurst, Company Secretary

Artificial intelligence (AI) can revolutionise boardrooms in today's rapidly evolving business landscape. Still, this rapid change threatens to distance boards from the companies they serve if proper care is not taken in implementing both the technology and the governance around it.

In this podcast, Dr. Sabine Dembkowski, Founder and Managing Partner of Better Boards, discusses how AI can revolutionise boardrooms with Moya Hayhurst, a Fellow of the Chartered Governance Institute with over 25 years of experience in corporate governance across multiple industries, including mining, financial services, and insurance. 

“If we go back to the beginning as to why boards were created, they're there to protect and drive the value of companies”

Boards have a significant role to play in that discussion, but to lead the debate about future-proofing effectively, boards need to absorb and process a vast amount of information. 

 “The real value from AI and similar is about integrating into the ethos of the company and the core infrastructure, and whether we like it or not, whether executive boards, executive committees and such acknowledge it, the board is a key component of that”

Moya is currently involved in a voluntary project with the Centre for AI in Board Effectiveness (CAIBE), which aims to get boards excited and engaged with AI as a tool for improving their effectiveness and the quality of their conversations. To Moya, in an ideal future state, board members and directors will be able to be more effective by having AI bring forward the data and information they need, when they need it, in easily digestible formats. 

“Some boards are further along than others"

Moya realises this is a leap forward. It wasn't that long ago that boards were reticent to use board pack technology. They wanted their hard copies printed and couriered to wherever they were in the world, whereas now 90% of boards walk into a boardroom with an iPad. It’s an evolution in progress. 

“Through an interface like AI, you can bring the board back in alignment with the company”

To Moya, what AI is surfacing is not that different skills are needed in the boardroom. The boardroom is already full of incredibly skilled people, but those people are struggling with the data coming at them, and thanks to the time it takes to prepare board papers, not all of that data is up to date. Backward-looking reporting is leading to missed opportunities.

“AI is a toddler. They are excited, energetic, and bring such amazing potential, but they've got to have guardrails so that they grow up in the right way”

Moya understands that boards have concerns about new technology tools and their security, as well as the protection of sensitive information. Fortunately, most organisations have a governance framework in place to strike a balance between responsibility and innovation. She thinks of AI as a toddler loaded with energy and potential but in desperate need of guidance and thoughtful training. 

The three top takeaways for effective boards from our conversation are:

1.      Lean on governance professionals and IT professionals to hel

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Transcript

SPEAKER_00: 0:02

Future-proofing the board with AI. Welcome to the Better Boards podcast series. The podcast for chairs, CEOs, non-executive directors, company secretaries, and their advisors. Every episode is filled with practical insights and learning from those inside boardrooms. We discuss what really matters and highlight actionable steps you can take to enhance the performance of your board. Join us on this episode as we explore how AI can revolutionize boardrooms in today's accelerated business landscape, where rapid change threatens to distance boards from the companies they serve. Discover how real-time intelligence delivered via natural language interfaces transforms raw data into competitive, actionable insights, ensuring decisions are both timely and value-adding. We'll delve into how the careful implementation of AI not only mitigates risks, but also preserves vital corporate, specialist, and industry knowledge, keeping boards relevant and proactive. Whether it's reigniting directors' passion or transforming reactive oversight into strategic leadership, this conversation is your essential guide to harnessing the full AI advantage whilst future-proofing your board. I'm delighted to talk with Moja Hayhurst. Moja is a fellow of the Chartered with over 25 years of corporate governance experience across multiple industries, including mining, financial services and insurance. She has a proven track record of leveraging technology to ensure governance function efficiently meet the needs of the business. Moja, thank you so, so much for contributing to the Better Bots podcast series. Hi, Sabine. Thank you so much

SPEAKER_01: 1:51

for inviting me today.

SPEAKER_00: 1:53

just so much going on around every board. And of course, everyone wonders what can we do to future-proof? So what do boards need to do to be future-proofed?

SPEAKER_01: 2:04

That is such a crucial question because as you say, there is so much happening around the board and we often have so many of the same questions, the same requests coming through. But the reality is, you know, if we go back to the beginning as to why boards were created is they're there to protect and drive the value of companies. And looking at AI, one of the biggest things that people say is, will our jobs be there tomorrow? And I'm not sure people have actually considered the role of the board in that question. Now, everything that we see nowadays, things are just speeding up driven by data.

SPEAKER_00: 2:45

Absolutely.

SPEAKER_01: 2:45

You know, there's so much information and it's coming at us so quickly from so many different directions. And one of the biggest challenges we have is being able to process it quickly enough. Absolutely.

SPEAKER_00: 3:01

I mean, even the challenge of reading these board papers, you know, I mean, it's just, I have yet to do a board evaluation, but I don't hear a complaint about the lengths it takes to read the board papers.

SPEAKER_01: 3:13

Exactly, spot on. And the challenge you also have is a lot of the directors actually hold more than one directorship. So it's not just one board pack of 500 pages or a board pack and some committee papers. They have numerous ones of this. And not only that, they have got to remember what's happening with that specific company, the history, the strategy, the risks they're facing. That's an awful lot that we are expecting from these amazing people I mean, the knowledge and experience that they have is just incredible. But to continue to unlock that value.

SPEAKER_00: 3:50

And that is exactly, we are so aligned, Moja. That is exactly one of the key questions. How can we really unlock that expertise, that knowledge to really, really leverage this? I mean, you are involved in a very interesting research project. Elaborate a little bit what, from your perspective, AI's role can be in this.

SPEAKER_01: 4:15

I am involved in a really interesting voluntary project right now, and it's the Center for AI in Board Effectiveness. So it's really looking to see how AI can enhance, unlock, almost encourage and engage again where we've gotten lost in the data. You know, AI is something that so many people are grappling with and so many companies. And it's been quite easy to segment it into a constraint of the different software platforms that you find in companies and curated within those elements. But the real value from AI and similar is really about integrating into the ethos of the company and the core infrastructure. And whether we like it or not, whether executive boards, executive committees and such acknowledge it, the board is such a key component of that. And it's really to link people back to the information, allowing them to have it surfaced for them at the right time so that they can easily on demand, ask questions, have the information at their fingertips to drive those conversations forward, to bring that critical thinking and that strategic guidance that we expect from the board. I

SPEAKER_00: 5:39

mean, it sounds like a brave new world. How do we get there?

SPEAKER_01: 5:44

It is. And I suppose... Let me give you an example. Sometimes that's easier to understand is, you know, as you said, you know, we have these incredible depth of data that comes at our directors and our executives that sit in the boardroom amongst others, really. Now, imagine you have, you can naturally ask questions from a, and this is very important, a curated knowledge pool of information. So really bringing that information back to the fingertips of of the people that needed at that moment in time. So you are a board director. AI has helped you and it sets you, for example, there is the key paper in this pack that we have just scanned for you is an approval for the relocation of a call center. And the director thinks, hmm, that sounds vaguely familiar. And he turns to his assistant and says, could you tell me when last the board had this topic? And let me know which of the key discussions points, you know, anything from the minutes, any actions. Next up on your screen comes a quick overview. Yes, this exact request has actually been considered by this board twice in the last five years. And here are the papers and the risks identified within the those elements in the minutes as well, all linked so he can actually go and drill down. And he thinks to himself, okay, that's interesting. Now he recalls that in strategy, there was a customer element to strategy. So again, he turns to his assistant and says, could you tell me what elements of the company strategy that we've just approved link into some of the benefits that are set out in this paper? Back comes the answer, customer satisfaction. And it goes further and says, The last update around customer satisfaction was in the consumer duty update. And again, brings back that paper and that information. He thinks, oh, that's interesting. Has a quick look through the paper. Notes that it was actually a comment around call volume that was called on that paper. Again, turns to his assistant. Very, very trustworthy assistant here. And this assistant, can you tell me what the current call volume is through that call center? And also, are we still within appetite on the time of those calls? Up comes this beautiful dashboard, you know, from a piece of stuff, I think Microsoft Power BI is often used for these things, amongst others. And up comes this beautiful dashboard, and you can see the call volumes are exponentially high at the moment. However, they are all being handled within the current risk appetite. He goes, oh, this is great. He carries on looking through the papers. And he notes that one of the comments that came up the last time with the call center was probably about three years ago per the paper, was actually the call resolution was where the time was being taken. Turns back to his trustee assistant and says, can you show me the call resolution? Oh, my goodness. And the charts just go red in front of him. So he can now see that this is actually a problem. He asked some more questions, but he's now hit the depth to which he can ask the questions. He can't go any further. But now he's already moved it along. Gets into the boardroom, starts going down the same track. The presenter pulls up the latest stats. It shows a Core volume has dropped down now. Things are looking amazing. But if they relocate this core center, they are going to unlock this cost saving of however much it is.

SPEAKER_00: 9:26

I understand, Moya. I understand. Sounds amazing. What needs to happen for us to get there? Because I have yet to see board packs or a board who has fully embraced this technology. You know, some boards are further

SPEAKER_01: 9:44

along than others. Absolutely. I mean, bearing in mind, it wasn't that long ago that boards were reticent to use board paper technology, board pack technology. They wanted their hard copies printed and couriered to wherever they were in the world. Whereas now, 90% of the boards... walk into a boardroom with an iPad. So this is part of that evolution. And the boards have seen the value of having electronic board papers. If you provide an interface like AI over the top of them, allowing them to actually ask straight questions based on simple curated database of maybe just the past board papers, you are already driving those conversations forward

SPEAKER_00: 10:33

in the boardroom. How do we ensure that there is a right balance between innovation and tradition, really?

SPEAKER_01: 10:39

Innovation and tradition can actually sit comfortably side by side. However, in my experience, innovation is often only, the potential on innovation is often only realized when it's guided by knowledgeable people. And in our organizations, we have incredibly knowledgeable people, but it's really thinking through how you unlock that. Now, how can AI cut through the data and how can you ensure that people the people that need, that have the knowledge, that can actually draw into that, really can use it to unlock that. So even the example I just gave you, tradition was a piece of paper, a board pack that was printed in front of you. Innovation was putting it into a portal that allowed directors to put sticky notes on it, have conversations with other directors or with the executive and get some questions answered before the meeting. And now it sits very comfortably in the boardroom. And this is just the next step of that innovation.

SPEAKER_00: 11:43

So what does it mean really for these skills we need in the boardroom? Do we need different skills? Do chairs that are now recruiting new non-executive directors need to look for a different profile of people? I don't think it's a different skill set.

SPEAKER_01: 12:02

I really think it's more a refocus almost on what are the skills that the board needs, that needs to be on the board for where the company is going. So unfortunately, regulation is amazing and regulatory requirements have driven some of the skill sets we see in the boardroom. And the reason why I said, you know, AI could, or this kind of implementation, this surfacing of knowledge or the integration of knowledge and people just using ai as their natural interface you know it can really help us to get back to where the value is in the room is unlocking that incredible knowledge resource we have and really focusing it on the strategic and critical thinking that we need to drive the organization forward and also something simple is being more aware of risks that are in industry and coming in the market because Data is the new gold, but it's the intelligence and it's how quickly companies can draw through that data and identify the threats and the trends and the opportunities and pivot. And I'm not sure how else other than through an interface like AI, you can bring the board back in alignment with the company as well. to really, to get them on the same page, to get them really grounded in the day-to-day realities of what the executive are facing and not get locked in data and information that is possibly weeks or months old.

SPEAKER_00: 13:31

Absolutely. And that's mostly, I mean, most of the papers are backward looking rather than presenting data that you can easily pull forward. Yeah.

SPEAKER_01: 13:41

Exactly. I mean, one of the biggest arguments you get is, oh, the board papers are too long. Well, If you just need to give a frame of what the item is about and where the information is, suddenly the paper goes from 50 pages to maybe five. If you can give people access to the live information that you've carefully curated behind it, then it becomes more a natural day-to-day navigation almost, rather than, as you said, what we currently have is this backward-looking, I mean, it is strategic because it does look at things very carefully and takes the current market view into account and intelligence by the presenters in the room. But sometimes where we lose time is where a question can't be answered in the room. And you've got to wait another quarter before you get the follow-up paper that answers that question, by which time you might have missed that opportunity completely.

SPEAKER_00: 14:38

I mean, a lot of people are always concerned when it comes to new technology about the risks, about security, about the safety of sensitive information. How can this be dealt with, really?

SPEAKER_01: 14:51

Honestly, carefully, thoughtfully, because you've got to balance the innovation responsibly with what we know about each organization is different. So you can't just use one brush for everybody. But most big organizations or even organizations that will actively consider this will have a governance framework. And the challenge is and the opportunity is actually making sure that you've thought this through alongside those pieces and clip them together. So you have a really, you know, you have the guide rails that an amazing opportunity like AI can actually work within. Now, AI is a toddler. They are excited, energetic and bring such amazing potential. but they've got to have those guardrails so that they grow up in the right way. And that is the job of, you know, the cyber security guys and the policies we have and the frameworks. And let's not forget, data integrity is so important. If the data that you're relying on is not robust, you're not going to have a great outcome.

SPEAKER_00: 16:06

Absolutely. We could talk for hours, but we sadly can't. But for our listeners, when you bring out your white paper based on the research you currently do, you will come back or one of your colleagues will come back. So there's always a tricky last question at the end of our podcast, which is what are the three things our listeners should take away from this podcast?

SPEAKER_01: 16:32

Three is always a challenge, but I'm going to try and distill it into those for you. I would say trust the professionals you have in your teams. So governance professionals, technology professionals, let them investigate the technology that will help you. Allowing better intelligence for quicker decisions, that's number one. Number two is trust. Don't be hamstrung by perceived risk. You know, that knee-jerk fear reaction. Think through it carefully. Quantify and manage the risk so that you can empower and engage your directors and your company to really be at the forefront of your industry. That's number two. Number three is you have got to have a plan. You've got to have a clear plan that understands the risk and governance framework of your organization, your sensitive data, and ensure that your guardrails are in place so that you can leverage all of the potential, unlock the excitement and the opportunities again, but in a very thoughtful, risk-averse, ethical, and responsible way.

SPEAKER_00: 17:49

Moja, fantastic. Thank you so, so much for contributing to the Better Boards podcast series. Thank you again for having me. This podcast episode is part of the Better Boards podcast series brought to you by Better Boards, the provider of board evaluation solutions. Get in touch if you would like to hear more about our work with boards, or if you would like to see a demo of our innovative board evaluation platform, or if you would like to have a chat about a topic you would like to see covered on this podcast series. We at Better Boards are always delighted to hear from you. You can best reach us at info at better-boards.com. Thank you for listening.