The Intersection of Corporate Governance and Artificial Intelligence: Challenges and Opportunities

By Hosea Mutwiri Kanyanga and Gilbert Kiprono

Keywords: Artificial Intelligence (AI), Corporate Governance

Artificial intelligence (AI) is a disruptive technology that has been rapidly adopted by companies in various industries, including finance, human resource, marketing, communication, healthcare, retail, and logistics among others. The use of AI technology raises many ethical and legal issues, including those related to corporate governance. Corporate governance refers to the system of rules, practices, and processes by which a company is directed and controlled. It ensures that a company is accountable to its stakeholders, upholds ethical standards, and complies with legal requirements. With the increasing integration of AI in businesses, there is a need to examine how corporate governance can effectively manage the risks and opportunities presented by AI.

Evidently, there is intersection of corporate governance and AI, especially on leveraging on the opportunities that come with it as well as appreciating the challenges that this can pose in corporate governance space. 

 In consideration of this subject, let us examine the opportunities that come with AI.  Despite the challenges, AI presents companies with several opportunities that can enhance their competitiveness and improve their corporate governance practices. Here are some of the most notable benefits.

Improved decision-making: AI technology can analyze vast amounts of data to generate insights that can significantly improve decision-making processes. As a result, AI can assist board members and executives in making informed decisions that align with the company's strategic goals and values.

Enhanced efficiency: AI technology can automate many mundane and repetitive tasks, freeing up resources to focus on more critical and value-adding activities. This may enable companies to become more efficient, productive, and profitable by reducing costs and improving productivity.

Better risk management: AI technology can identify and monitor potential risks in real-time, allowing companies to respond quickly and proactively to emerging threats. This may help businesses to minimize their exposure to risk and protect their assets and stakeholders effectively.

The use of AI in corporate decision making may also pose myriad of challenges for executives and board members which includes but not limited to:

Ethical considerations: The development and deployment of AI can create ethical dilemmas for companies, mainly when it concerns the collection and analysis of confidential information. The use of AI algorithms for hiring, for example, may raise questions of fairness, privacy, and potential bias in decision-making processes.

Lack of transparency: AI technology is complex, and its decision-making processes can be difficult to understand for average persons. This lack of transparency may limit the ability of the corporate governance system to control or govern AI-driven decision-making processes. It can also hinder the ability of stakeholders to hold the company accountable to ethical and legal standards.

Risk management: The use of AI technology carries significant risks, including data breaches, cyberattacks, and technological malfunctions. These risks can harm a company's reputation, financial stability, and trust from its stakeholders. Therefore, effective risk management is essential to ensure that the company's AI strategy aligns with its strategic goals and values.

In conclusion, to effectively manage the intersection of corporate governance and AI, companies should establish clear policies and procedures for the development and deployment of AI systems. This should include guidelines for data privacy, security, and transparency in decision-making. Companies should also establish oversight mechanisms to ensure that AI is used ethically and in compliance with legal and regulatory requirements.

Dear Honorable Member,

This is to notify you that in its 241^st Council Meeting, the Council elected FCS Jacqueline Waihenya as the Institute's Vice Chairman. 

This is in accordance with paragraphs 6 (1) and (2) of the 2nd Schedule of the CPSK Act Cap 534 Laws of Kenya. 

Find note the full Council as now constituted.

Kind regards,

CS Gloria Kikete
Corporate Secretary

2023 ICPSK ELECTION RESULTS

Following the just concluded council elections held from 15^th May 2023 to 17^th May 2023, the Chairman position and 6 vacant council positions had candidates duly elected.

The elected candidates assume office and make up the 11-person council.

 
2023 ICS ELECTIONS - ONLINE VOTING INSTRUCTIONS
 
The official voting will commence online between Monday, May 15th, 2023 at 8:00 am and Wednesday, May 17th, 2023 at 5:00 pm as per the Elections Guidelines.
 
Voting is exclusively online (vote.icpsk.com).
 
The members who are eligible to vote have received tokens and a link to enable them vote.
 
To confirm eligibility please click here (https://vote.icpsk.com/eligibility/).
 
In case of any inquiries, please email This email address is being protected from spambots. You need JavaScript enabled to view it.

The State Corporations Advisory Committee (SCAC) partnered with the Institute of Certified Secretaries (ICS) to mount the 2023 induction workshop for Board Members of State Corporations.

This Board Induction was held in four Cohorts from 12th to 26th April 2023 at Lake Naivasha Resort, Naivasha with the first Cohort held between April 12^th to 14^th, 2023, and was officially opened by H.E. Dr. Musalia W. Mudavadi.

The Workshop was premised on good governance promotion in Kenya.

The collaboration between ICS and SCAC, that started way back in 2015, from MWONGOZO CODE of Governance for State Corporations in Kenya, has been further strengthened through this noble capacity building initiative.

This Board Induction Workshop brought together all Board Members and Chairpersons in all state corporations in Kenya, and created a platform for exchange of ideas, and robust engagement on corporate governance matters.

During this Induction Workshop, several topics and thematic areas were covered that include; principles of Corporate Governance under Mwongozo and Emerging Issues, Policy and Institutional Framework of State Corporations; emotional intelligence and Boardroom dynamics, Overview of Governance Audit Framework, Overview of Public Procurement and Disposal Framework for State Corporation, and Effective Management of Meetings, Ethics among others. 

 
Regards,

CS Gloria Kikete
Corporate Secretary

The corporate secretarial profession has over the years evolved from traditional compliance and a greater focus is now on governance advisory services. This coupled with technological advancement, economic dynamics, and other changing trends in the global and local arena has necessitated the review of the Certified Public Secretaries of Kenya Act, Cap 534 of 1988 (“the Act”).

To this end, The Cabinet Secretary to National Treasury and Economic Planning appointed a multi-sectoral Taskforce in July 2022 to review the legal framework for the corporate secretarial profession. The Taskforce is in its final stages of this assignment and has developed a Draft Bill.

Pursuant to the Constitution of Kenya, 2010 and all other relevant legislation, the Taskforce in its 8th meeting approved Public Participation, with all Stakeholders, key among them, members. 

You can access the Bill here THE CERTIFIED GOVERNANCE SECRETARIES BILL, 2023

Please see below communication and give feedback in the input template also attached.

 PUBLIC NOTICE

 DRAFT BILL COMMUNIQUE

THE CERTIFIED GOVERNANCE SECRETARIES BILL, 2023

PUBLIC PARTICIPATION INPUT TEMPLATE

Dear Member,
 
As part of encouraging the governance professionals to do research on corporate governance, ICS releases peer reviewed Governance Journal, Vol 1-Issue 1- 2023.   Click the links below to access an online version of the governance journal and governance journal editorial policy 2023.
 

1. ICS Governance Journal - Vol 1 Issue 1 – 2023
2. Governance Journal Editorial Policy 2023

Note that submission of articles to be considered for publication in the governance journal is on a rolling basis.  For more information or clarification, contact This email address is being protected from spambots. You need JavaScript enabled to view it.
 
 
Kind Regards,
 
Gilbert Kiprono
Manager, Research and Business Development

 ICS Governance Journal - Vol 1 Issue 1 – 2023

 Governance Journal Editorial Policy 2023

Dear Member,

We have Boldly incorporated technology and innovation by adopting a new ERP platform, and engaged new staff members, both aimed at enhancing Excellent services to members, as we Collaborate with stakeholders with mutual interests. We are also Agile in pursuing new frontiers, all the while maintaining our Integrity.

See a highlight of how we're doing all that in our Newsletter attached.

Happy reading and don't forget to give us feedback via This email address is being protected from spambots. You need JavaScript enabled to view it.

Yours sincerely,
 
CS Gloria Kikete
Corporate Secretary

 Newsletter