Boards have always been expected to see around corners. AI turns that expectation into a daily operating requirement: one headline celebrates your AI-powered growth, the next details a scandal fueled by unchecked output.
EY’s framing of today’s landscape is useful because it highlights three shifts that force practical board actions—each with a very human barrier.
Shift 1: Transformative thinking beats productivity gains. Most organizations started their AI journey with employee-level efficiency.
Board action: Help management rethink their risk appetite (including the risk of not moving boldly), define “signals” that trigger strategy reviews such as competitors’ AI investments, and target specific P&L areas to focus investments.
Major barrier: CEO or director resistance to the board’s deeper involvement in strategy (the “reviewer, not co-shaper” dynamic), which keeps AI discussion safely superficial.
Shift 2: Reduce entry-level work, not entry-level talent. AI can already handle 50%–60% of typical entry-level tasks. It’s tempting to cut junior roles aggressively, but that can quietly dismantle your future leadership pipeline and bottom-up innovation.
Board action: Set KPIs for junior-level employee development and tie executive compensation to how well leaders blend AI with human skills.
Major barrier: Short-term cost pressure that treats junior headcount as “easy savings,” ignoring pipeline erosion and potential backlash.
Shift 3: You can’t automate accountability. Approximately 1 in 5 Fortune 100 companies flag AI hallucinations, inaccuracies, or bias as material risks in their 10Ks. Add in “workslop” risk and the liability grows.
Board action: Require explicit accountability for AI work quality, and ensure robust testing, third-party assessments, and legal-risk review to stay ahead of unintended consequences.
Major barrier: Directors may have an AI fluency gap and discomfort experimenting, which prevents the probing questions that surface real risks early.
