Good morning,
Two weeks ago, I attended the Collision conference in Toronto, a major tech summit where generative artificial intelligence dominated the conversation.
In a keynote talk, the grandfather of A.I. himself, Geoffrey Hinton, took to the stage to repeat warnings about A.I. and the potentially catastrophic problems it might generate. He called for engineers to slow down and put guardrails in place before A.I. becomes more intelligent than its makers. “I think the people developing it should be encouraged to put a lot of work into understanding how it might go wrong, understanding how it might try and take control away,” he said.
On the whole, however, A.I. enthusiasm saturated the event, just like it has everywhere else. (“Generative A.I. is churning out unicorns like it’s 2021,” a research firm declared in a recent market snapshot, noting that 13 A.I. companies are now valued at over $1 billion each.)
Large companies and their boards have begun to move beyond the hype to a place where they’re thinking more critically about A.I., according to Jay Persaud, a partner at global professional services firm EY, where he's on the hunt for innovative startup technologies, including A.I., that can solve existing problems for EY and its clients.
On the one hand, boards hear that A.I. is the “most important invention since the internet” and an absolute must-have, Persaud says. But generative A.I. software relies on large language models that must be customized with a company’s data to be useful. That opens the business to significant risks that boards are responsible for monitoring.
“Boards are also looking to management to come to them with a balanced discussion,” Persaud said, including a plan for safeguarding data. "Boards are saying, ‘Yes, we're going to use [A.I.], and we're going to get really good at it...But how do we protect the crown jewels? How do we keep ourselves out of trouble?’”
Peter Gleason, CEO of the National Association of Corporate Directors (NACD), tells Fortune that his organization views A.I. as transformative. But he also sees boards “taking a contemplative, inquisitive approach in assessing company and industry implications.”
A recent NACD pulse survey shared with Fortune shows why caution may be warranted: Only 10% of directors surveyed said their management teams are very or extremely proficient with A.I. issues.
Lila MacLellan
lila.maclellan@fortune.com
@lilamaclellan
