The latest episode of Governance Intelligence’s Governance Matters podcast brings advice from experts on two of the biggest challenges facing companies in the year ahead: climate change and artificial intelligence (AI).
We first talk to Alexandra Higgins, managing director with Okapi Partners, about companies’ plans to transition – or adapt – in the face of growing physical threats from climate change. Those range from events such as more intense hurricanes and wildfires to long-term water shortages.
Despite the media coverage of these threats, some boards are yet to address them with a plan. Higgins explains that many are simply unaware of the risks facing their companies, perhaps because they are buried in the Form 10K. Corporate secretaries therefore have an important role to play in ensuring their boards are educated on these risks and are continually updated on the issues, including what other companies are doing strategically in response, she says.
Although they are important for companies to adapt to climate change, transition plans can have negative social consequences – for example, if insurance companies withdraw hurricane coverage from states such as Florida. Higgins discusses viewing these side effects from a governance perspective and how much disclosure companies should give when it comes to their planning and potentially negative impacts.
Later in the show we hear from Ajita Abraham, former general counsel for financial services at Capgemini, about some of the latest regulatory developments around AI. The EU last month agreed the final version of what is thought to be the world's first comprehensive legal framework governing the technology. Although it is EU-implemented legislation, Abraham explains how its reach could affect many US companies. She also discusses a White House executive order on AI that comes into effect later this month.
Abraham also shares advice for governance teams on helping their companies manage the privacy and confidentiality risks AI presents, including ensuring employees understand that once information is put into an AI tool it's no longer confidential.
The Governance Matters podcast provides listeners with insight into cutting-edge issues of the day for corporate secretaries, general counsel and other governance professionals.
The series looks at how the roles of the corporate secretary and the board have evolved over time, as well as how the governance landscape continues to change. From ESG and entity management to shareholder engagement and technology, hear from award-winning governance professionals and leading advisers about the latest public company governance matters.
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