Some years back, had attended the 'International Round Table on Corporate Governance' organized by The Institute of Company Secretaries of India.
Made the following observations:
a) Can Corporate Governance, even in the most progressive organizations withstand the onslaughts from adverse business conditions, which can even threaten the very existence of such organizations? Thus, if the "name of the game" becomes just remaining focused on the top line for the sake of survival, then can the compliance and internal controls of the organization be compromised to some extent? Our boards are under immense pressure to perform, not just from Sebi but from shareholders, rating agencies and civil society as well. As businesses grow more complex, and stakeholders’ expectations rise, the traditional approach to board evaluation simply won’t suffice,
b) What can be the role of Corporate Governance in ensuring the financial stability of an economy, with special reference some adverse news from banking system with specific reference to lapses in some of the leading banks, and
c) Why is Corporate Governance generally synonymous with the finance domain of an organization? Yes, it is very important, but then as Corporate Governance is all about the conduct of certain key people in an organization, why can't its essence also give a flavor to the progressive Human Resource practices as well, which can percolate down to the last functionary in the organization?
Reflecting the above in this era of AI, it's reasonable to imagine the role of Agentic AI systems, to evaluate and support, the functioning of the Boards of any progressive organization.
Taking the banking industry in particular, one can visualize a LLM based Agentic AI system at the RBI, which is connected to each bank and other Regulated Entities. LLMs provide the core language understanding and generation capabilities, that enable agents to interact with humans, analyze information and make decisions.
Each aspect of a bank’s/Regulated Entity's functioning, right from Board of Directors, to audit reports, quarterly financial statements etc could be inputted in the system, and based on some well defined norms, the Agentic AI system could identify lapses (if any) and make suggestions accordingly to the bank/RE in question.
Secondly, any such feedback by the Agentic AI system, need not be confined to the bank/RE in question. Rather to be shared as proactive measure, with all the banks and RE’s, in the interests of the stability of our financial system, without of course disclosing the identity of the bank for which the said feedback/s was originally meant.
The RBI top brass should also be in receipt of such lapses so identified by the system, for the necessary corrective actions at their end. This idea can be extended to many other aspects of our banking system.
That, we could then be a role-model for the banking systems in other leading economies as well, is a 'no-brainer'.
Made the following observations:
a) Can Corporate Governance, even in the most progressive organizations withstand the onslaughts from adverse business conditions, which can even threaten the very existence of such organizations? Thus, if the "name of the game" becomes just remaining focused on the top line for the sake of survival, then can the compliance and internal controls of the organization be compromised to some extent? Our boards are under immense pressure to perform, not just from Sebi but from shareholders, rating agencies and civil society as well. As businesses grow more complex, and stakeholders’ expectations rise, the traditional approach to board evaluation simply won’t suffice,
b) What can be the role of Corporate Governance in ensuring the financial stability of an economy, with special reference some adverse news from banking system with specific reference to lapses in some of the leading banks, and
c) Why is Corporate Governance generally synonymous with the finance domain of an organization? Yes, it is very important, but then as Corporate Governance is all about the conduct of certain key people in an organization, why can't its essence also give a flavor to the progressive Human Resource practices as well, which can percolate down to the last functionary in the organization?
Reflecting the above in this era of AI, it's reasonable to imagine the role of Agentic AI systems, to evaluate and support, the functioning of the Boards of any progressive organization.
Taking the banking industry in particular, one can visualize a LLM based Agentic AI system at the RBI, which is connected to each bank and other Regulated Entities. LLMs provide the core language understanding and generation capabilities, that enable agents to interact with humans, analyze information and make decisions.
Each aspect of a bank’s/Regulated Entity's functioning, right from Board of Directors, to audit reports, quarterly financial statements etc could be inputted in the system, and based on some well defined norms, the Agentic AI system could identify lapses (if any) and make suggestions accordingly to the bank/RE in question.
Secondly, any such feedback by the Agentic AI system, need not be confined to the bank/RE in question. Rather to be shared as proactive measure, with all the banks and RE’s, in the interests of the stability of our financial system, without of course disclosing the identity of the bank for which the said feedback/s was originally meant.
The RBI top brass should also be in receipt of such lapses so identified by the system, for the necessary corrective actions at their end. This idea can be extended to many other aspects of our banking system.
That, we could then be a role-model for the banking systems in other leading economies as well, is a 'no-brainer'.
