Artificial intelligence (AI) is rapidly transforming the landscape of corporate governance in Australia. Governance Institute of Australia is at the forefront of this change, working to ensure that AI is integrated into business practices in a responsible, ethical and effective manner.

The recent release of the Federal Government’s Voluntary AI Safety Standard has prompted organisations to critically evaluate and incorporate AI into their operations. The human-centred standard aims to protect people by upholding diversity, inclusion and fairness in the deployment of trustworthy AI systems. In response, Governance Institute, in collaboration with the National AI Centre (NAIC), has developed a comprehensive white paper aligning the 10 voluntary guardrails that promote safe, responsible and transparent AI with best-practice governance guidance tips from industry experts.

The white paper highlights a significant issue: Australian businesses are not fully capitalising on AI. Confidence within the business community is currently lagging behind those of comparable countries. Ethical challenges and a lack of understanding are causing missed opportunities for innovation and efficiency. We must urgently address this gap to stay competitive in the global market.

Understanding and adopting AI is crucial for maintaining a competitive edge. The white paper provides corporate governance professionals with valuable insights and practical strategies to harness AI’s power. It emphasises AI’s potential to drive innovation, enhance operational efficiency and address complex societal and environmental challenges, as well as the appropriate standard of awareness required for its safe and effective deployment.

Continuous improvement of AI systems to reduce biases and ensure fair outcomes is essential. We advocate for seeking guidance from regulators on issues like copyright and ‘deepfakes’, incorporating legal, ethical and commercial considerations into AI procurement and contracts, and leveraging AI for enhanced digital asset security. Prioritising robust privacy and backup systems during AI implementation is also critical.

Good governance is key to ensuring that AI technologies are developed and used transparently, fairly and in alignment with societal values.

We have also released an issues paper, ‘Artificial Intelligence and Board Minutes’, that delves into the potential applications and challenges of using AI in board meetings and company secretarial practices. It explores various risks, including data privacy concerns, cybersecurity risks, intellectual property issues, accuracy of output, potential for bias and discrimination, and regulatory compliance issues.

While tools like Microsoft Teams, Zoom and Google Meet can generate meeting transcripts or summaries, and applications like Microsoft Copilot can extract actions from these summaries, there are legal and practical considerations to bear in mind when using these in board meetings. The legal requirements for keeping minutes under section 251A of the Corporations Act 2001 are explored, stressing that minutes are not a transcript of the meeting but a record of board decisions and the process by which those decisions have been made.

We also support the views expressed in the Australian Chamber of Commerce and Industry (ACCI) submission to the Government on AI mandatory guardrails. ACCI calls for a balanced approach to AI regulation, advocating for a risk-based framework that avoids unnecessary burdens on businesses, particularly small and medium-sized enterprises (SMEs). This aligns with our stance on promoting AI adoption across the economy, while ensuring robust governance practices.

AI offers immense potential for driving economic growth, enhancing efficiency and creating value across all sectors. It is crucial that we approach its adoption with a balanced perspective, grounded in sound ethical principles and robust governance practices. By doing so, we can ensure that AI technologies are developed and used in ways that are transparent, fair and aligned with societal values.