Artificial intelligence (AI) is no longer a futuristic concept confined to the realm of science fiction.
AI tools on the market today advertise the ability to process audio recordings, transcribing spoken content into text. Some AI tools can even ‘join’ virtual meetings (Zoom, Teams, etc.) to transcribe spoken content in real-time.
However, using AI for recording transcripts of board meeting discussions and preparing board minutes is not without risks. This year, the Australian Institute of Company Directors (AICD) and the Governance Institute of Australia (Governance Institute) have jointly issued a statement titled ‘Effective board minutes and the use of AI.’
Businesses must recognise that AI recordings and transcripts of board meetings do not satisfy the Corporations Act 2001 requirement to keep a record of a meeting in a minute book that is signed by the chairperson.
The AICD and the Governance Institute have highlighted several key risks of using AI to record transcripts or to prepare minutes of board meetings, including:
Material inaccuracies in the recorded transcript, which could lead to inaccurate minutes. This is especially the case where audio/microphone quality is poor: speakers cannot be identified, and keywords and industry-specific terminology are incorrectly interpreted by AI.
Inability to recognise tone, intent and non-verbal cues of speakers.
Vulnerabilities within third-party AI providers’ security systems that can heighten the risk of cyber-attacks and data breaches.
Any recording or transcript retained will be discoverable and admissible in court as evidence and has the potential to contradict the formal board minutes.
Legal advice or privileged information discussed may be compromised in a recording or transcript of a board meeting.
Material inaccuracies in AI-generated output, including fabricated information and ‘hallucinations’ where generative AI is used. Such content may read coherently but is false or incorrect.
Generative AI may use the content of board papers and management’s recommendations as its central input. This may not accurately reflect questions or constructive challenge of management assumptions that may take place during a board meeting.
Businesses using AI should establish clear policies and processes for its use, as well as implementing measures to safeguard the integrity of business and company data, including:
a clear policy as to what information is not acceptable to upload to an AI tool;
accountabilities within the business for providing detailed reviews, verifications and corrections; and
how legal advice or privileged information will be handled where AI is used to record or produce a transcript or generate draft minutes.
In business, AI cannot fully appreciate the nature and importance of risk attaching to a particular decision. It is only with professional judgment and oversight that AI, like any other tool, can be effective.
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