Insights ¦ Governance of AI: A critical imperative for today’s boards, 2nd edition

Key Takeaways

1. AI’s strategic integration in organisations remains nascent; just over a quarter of surveyed organisations have incorporated AI into their operational plans, highlighting significant room for acceleration.

2. Boards are increasingly recognising AI as a critical governance priority, with almost one-third currently not engaging with AI on their agenda, though this is a reduction from previous figures.

3. Awareness among board members of AI’s potential and risks has improved; however, two-thirds still report limited or no relevant knowledge, underlining the need for enhanced education and expertise.

4. Organisations are witnessing a rising influence of AI on board composition, prompting boards to rethink their structure and skills mix to effectively oversee technological change.

5. The pace of AI adoption is recognised as needing to accelerate, with only 25% satisfied with their organisation’s current speed, highlighting urgency for strategic focus.

6. Most organisations remain in experimental or focused phases of AI implementation, with only a small percentage (5%) having fully embedded AI into their core business and operational plans.

7. Survey data indicates progress in organisational preparedness; notably, a reduction in organisations feeling unready (from 41% to 31%), though risk and governance preparedness remains static.

8. Cross-functional interaction between boards and executive leadership (notably CIOs, CTOs, and CEOs) is strengthening, facilitating holistic AI strategy development.

9. Boards are actively seeking to enhance their AI fluency, with nearly 60% pursuing independent education and almost half bringing in external specialists.

10. There is growing recognition of the need to adapt board composition, possibly through recruiting members with more AI and emerging tech experience, to support effective oversight.

11. Organisations are encouraged to develop comprehensive frameworks covering AI strategy, risk appetite, governance structure, talent, and ethical considerations to manage AI transformation effectively.

12. The report underscores the importance of organisations adopting a long-term, resilient approach to AI governance, balancing innovation with responsible use to sustain stakeholder trust.

Key Statistics

• 31% of surveyed respondents say AI is not on the board agenda, a decrease of 14 percentage points from the previous survey.

• 66% of respondents feel their boards lack sufficient AI knowledge, improving from 79% previously.

• 33% of respondents are not satisfied or concerned about the time their boards devote to AI discussion, down from 46%.

• 40% of organisations are reconsidering their board composition due to AI influences.

• 17% of boards address AI at every meeting, and 19% only once a year.

• 53% of respondents feel the need to accelerate AI efforts, with only 25% satisfied with their organisation’s current pace.

• Only 5% of organisations have fully incorporated AI into their business and operating plans.

• 38% of organisations are experimenting with AI, whilst 35% focus on specific areas.

• 31% of organisations feel unprepared to deploy AI, a decline from 41%.

• 59% of individual board members are seeking to enhance AI knowledge independently.

• 72% engage with their CIO/CTO on AI, with 52% engaging with the CEO.

• 54% of respondents come from organisations with revenues under US$1 billion; 42% serve at publicly listed or private firms, and 29% are in financial services.

Key Discussion Points

• The strategic importance of embedding AI into organisational frameworks to enhance performance and resilience.

• The imperative for boards to accelerate their AI knowledge and oversight responsibilities amidst rapidly evolving technology.

• The need to reconfigure board composition and skills to keep pace with AI developments and ensure effective governance.

• How organisations can develop holistic and adaptable AI strategies, balancing operational goals with risk management.

• The importance of fostering active communication and collaboration between the board and C-suite leaders, notably CIOs, CTOs, and CEOs.

• The role of targeted educational initiatives—both organisational and individual—to build AI fluency among board members.

• The urgency of establishing clear governance frameworks that incorporate responsible innovation and Trustworthy AI principles.

• The value of external expertise and specialist input in guiding AI strategy, risk assessment, and ethical considerations.

• The significance of integrating AI progress into long-term business planning and operational roadmaps.

• How organisations should evaluate their readiness to deploy AI, including infrastructure, strategy, and risk governance.

• The need for comprehensive oversight frameworks that address AI’s ethical, operational, and regulatory implications.

• The critical role of leadership in fostering a culture of responsible innovation and balancing rapid AI deployment with ethical standards.

Document Description

This article is an in-depth report by Deloitte’s Global Boardroom Program, outlining current trends, challenges, and strategic considerations for senior managers in the financial services sector regarding AI governance. It highlights ongoing progress, identifies gaps in board oversight and knowledge, and offers actionable insights for accelerating AI adoption, strengthening board capabilities, and reinforcing responsible innovation. Emphasising the critical importance of proactive and comprehensive governance, it aims to equip boards and executive teams with the questions and frameworks needed to navigate AI’s rapid evolution responsibly and effectively.