Mitigating risk when using AI in the boardroom

Does your board use AI to take minutes? Directors must weigh the efficiency and accuracy AI promises against concerns of confidentiality and data security. This AICD–Governance Institute guide will help.

Taking the minutes is a mandatory requirement for board meetings. So relying entirely on AI to produce them is a big step, fraught with risk if certain safeguards aren’t in place.

Generative AI tools are immensely powerful but most are still prone to ‘hallucinations’ where they invent facts to fill gaps in their knowledge. If a tool is writing up minutes based on the conversations it is hearing it may struggle with heavy accents, fast talkers or multiple people talking over each other.

So a set of governance procedures need to be in place before such a leap of faith can be taken.

In 2019, the AICD and the Governance Institute sought a legal opinion from barristers Dominique Hogan-Doran SC and Douglas Gration to establish key principles on effective board minutes. Much of the subsequent joint statement remains current, but the rapid development of AI has led to an Updated Statement that includes guidance on  how AI should be used to prepare accurate and reliable board minutes.

Minute essentials

During a recent webinar to launch the resource, experienced chair and director Graham Bradley AM FAICD outlined what he likes to see.

“I look for a brief summary of the key discussions and rationale behind the decisions made,” he says. “For example, the minutes need to be useful for a director who didn't come to the meeting and needs to understand what happened and why the board made the decisions it did.” 

The draft from the company secretary should be fact-checked with management to ensure accuracy and that all the correct terminology has been used. It needs to be delivered to the chair in a timely manner when memories are still fresh.

When Bradley receives the draft, he checks all the facts and looks for any potential risks. 

“I read them so that my board doesn’t have to spend a lot of time on approvals. That doesn't mean the board members shouldn't be reading them very carefully because they are a legally binding document.”

AICD chair Naomi Edwards FAICD added that boardroom meeting minutes are a powerful way of showing the valuable discussions boards have.

“There's no other record of the value that we're adding as a board,” she said. “Well-written minutes cut out all of those side avenues we went down and get to the heart of why we made the decision that we made, and the arc that we used to reach it.”

Time and length

Many attending the webinar asked what the best length for minutes should be.

This often depends on the organisation, according to Dominic Millgate FGIA MAICD, group company secretary, Woolworths Group. “It's not about a verbatim transcript.

“Always look at minutes with a level of proportionality to the particular topic that you're talking about — risk, importance to the board, importance to the stakeholders that will view these minutes and rely upon them,” he said.

“That can go from a rudimentary item that you don't need to record a whole lot on to the really important stuff, where there may be more detail and information has to be drafted carefully. The hours you put into minutes can often make quite a difference.”

The panel benchmarked about two hours spent on the minutes for every hour of board meetings.

Key points from the guidance

There is no prohibition on a company using AI as part of the preparation of draft board minutes. Using AI to record or produce a transcript of board meeting discussions or generating minutes using meeting notes, recorded transcripts and board papers as inputs may increase efficiency and productivity. But significant risks and limitations within AI tools need to be carefully weighed by organisations against any benefits.

While the risks associated with AI may be more proportionate or readily mitigated in the case of smaller private companies or NFPs, risks are likely heightened for ASX-listed entities and those in highly regulated sectors. This is particularly true where minutes are subject to regulator review or private litigation where a more cautious approach should prevail. 

If a board elects to use AI for its board minutes, it’s imperative that appropriate governance controls are in place, including human oversight.

A critical review and further refinement of draft minutes will always be required by a governance professional and the board, particularly to ensure the minutes reflect complex board discussions accurately.

Case by case

There is no ‘one size fits all’. Some minutes may include more detail than others.

Critically, the risks of using AI to prepare board minutes will vary from company to company and sector to sector.

Transcripts can be “dangerous” as they might contain legal or privacy risk or can lead to ambiguity. They might contain “in-camera” sessions, or quote specific directors, which board minutes would not normally do.

However, Edwards said organisations with limited resources or time — smaller companies or a not-for-profit — might benefit from having AI take a transcript of a meeting and convert that into a set of minutes. Then the full transcript could be discarded.

“Does being recorded change the quality of the conversation? I don't think it does. I think that we'll get used to it very quickly,” she said. “We're probably all being recorded in our lives more than we realise, so I don’t see that it will cramp conversation. It may make us more polite as we learn not to talk over each other. AI, at the moment, is not as good as a human at separating out different strands of conversations. People will become even better at going through the chair when they talk.”

Edwards expressed great optimism and said that given using AI is legal, it was a chance for smaller operations and NFPs to “dive in and have a go with this”.

Board portals

While some board management portals offer in-built AI tools that can summarise board papers and distil key points for directors ahead of board and committee meetings, this comes with the risk that critical areas of the board pack are overlooked or omitted from AI-generated summaries.

Applications such as Zoom, Microsoft Teams and Google Meet can record meetings verbatim and generate written transcripts or summaries of the meeting discussion. Programs such as Microsoft Copilot can also extract and analyse information to isolate actions from such summaries.

Seek education

The fundamentals of what is required haven't changed, stressed Louise Petschler GAICD, General Manager, Education & Policy Leadership AICD. 

“There's enormous opportunity, with AI particularly, and we expect that to accelerate over the next year. We're still in a fairly cautious environment at this point, but those same fundamentals around the purpose of minutes and the detail remain the same,” she said.

“The updated statement describes measures that we're recommending to safeguard the integrity of minutes if you're using AI tools and the importance of that governance, professional oversight, understanding the context, clarity of policy and procedures and the accountability.

“This is why an AI Director is not going to replace a real director. The really important thing is to gain personal education as well as that organisational training in the legal framework, in the data and those issues of internal controls — those are really key points.”

This article first appeared under the headline 'Director Tool: Every minute counts' in the June 2025 issue of Company Director magazine.