The Case and Call for Action

The 2024 NACD Blue Ribbon Commission Report on Technology Leadership in the Boardroom: Driving Trust and Value calls on boards to govern technologies with more definition, a more strategic focus, and more proactive engagement.

The Case for Action

“There is something unique about this moment,” one Commissioner said at the outset of the discussions for the 2024 NACD Blue Ribbon Commission. A quarter of the way through the twenty-first century, corporate value enabled by technology and data has become central to economic growth. The World Economic Forum’s May 2024 Chief Economists Outlook notes, “Chief economists are unambiguous in expecting technological transformation, AI, and the green and energy transition to be growth drivers in high-income economies over the next five years.”

The promise of technology and data may never have been greater. However, the speed of technological change has accelerated at such a pace that many enterprises across industries feel a loss of control: they are too slow to capitalize on new disruptive opportunities, fear the onslaught of new tech-first competitors, and may be unaware and unprepared for the many new, sometimes devastating, technology-driven risks.

One specific technology stands out today: Generative AI (GenAI). McKinsey estimates that GenAI could produce between $2.2 and $4.4 trillion in economic value annually between 2023 and 2040, depending on the rate of adoption. GenAI’s potential value is a fraction of the $11 trillion to $17.7 trillion of economic value that all AI applications are expected to deliver.

Meanwhile, varying forms of data fuel the immense potential of GenAI. Firms are feeding text, images, videos, spreadsheets, recordings of natural language, code, machine script, and other forms of information into GenAI tools to generate insights, create new content, streamline operational processes, and launch a myriad of other applications. Advancements in data processing and AI are allowing some companies to transform the underlying value of their business—for example, moving from a business model of consumer goods to a data-centric company that collects information via consumer goods sales.

But progress is not driven by GenAI alone. There are advances in areas like industrial robots, augmented and virtual reality, 5G telecommunications, low- and no-code software development, quantum computing, and biomimetics. The use of AI to detect cancers in patient scans is improving outcomes; advancements in material sciences, robotics, and data analysis are driving a new age of space exploration; and retailers and other industries are providing faster and better responses to consumers through chatbots. These and other technologies have the potential to converge into opportunities and disruptions across industries that have not been imagined yet. As one Commissioner noted, “Across every industry, technologies will change the way we do business and the business we do.”

The pace of change is likely to accelerate even more rapidly as technologies themselves—notably, GenAI—improve on their own. All of this is driving a fundamental question for corporate leaders and their boards: how do we stay relevant, resilient, and achieve long-term growth in this period of technological change and disruption?