AI Governance and Tech Committees: An Empirical Analysis in Europe and North America

Abstract

Artificial intelligence (AI) plays a key role in corporate boards, but it also creates significant risks. In this article, we study the role played by tech committees in managing such risks and opportunities. In order to do so, we consider North American and EU listed companies that have adopted a tech committee in the period 2000-2019 and the companies’ documents describing tech committees’ activities as for 2019. We carry out both quantitative and qualitative analysis to understand the features of tech committees, their composition and, in particular, to identify the functions that such committees perform in practice. Besides the differences between the jurisdictions considered, the outcome is that tech committees do not deal with AI, whereas they play a rather predominantly strategic and monitoring role, sometimes flanked by risk management functions. As this shows a lack in the current governance of the most recent technological developments we propose a two-layer model for AI governance that corporate boards should adopt in order to fully benefit from the employment of AI.

Keywords: Tech committees, Artificial intelligence, AI, board of directors, board committees, corporate governance, AI governance, corporate law, diversity, transparency, accountability, trustworthy AI, tech governance, ethical AI

JEL Classification: K20, K22, O30, O32, O33