In a major change of business sentiment, UK executives have said they are pushing AI to the backburner. As boards look to focus on immediate business risks, the importance of AI has decreased drastically, indicating a lack of confidence that the technology could help boost results quickly enough to counter current economic headwinds.

‘Navigating a New Era for the Non-Executive Director is a report produced by executive search firm Norman Broadbent and audit and advisory brand BDO. Interviewing 200 board directors, the report shows how the role of the non-executive is shifting in the 21st century, and is becoming more integrated in the daily running of the business.

“There was a time when strategy was purely an executive board member consideration” said director Shrenik Parekh at BDO. “This is no longer the case, with more and more being expected of non-executive board members, particularly the longer-term success of the businesses they represent. Beyond providing strategic direction and input, it is clear that NEDs are increasingly spending more time managing and interacting with stakeholders such as shareholders,  regulators and external consultants.”

With that in mind, the results for the survey, and the priorities for non-executive expertise to obtain in the coming years, paint an unexpectedly conservative picture of most business strategy in the UK.

Source: BDO, Navigating a new era for the non-executive director

Over the previous two years, many reports in the UK have noted the upbeat sentiment among business leaders, in spite of the actual state of the economy. Most were said to be optimistic for their futures, thanks largely to the perceived potential of artificial intelligence. Following the public release of ChatGPT, businesses were quickly swept up by hype that suggested the world was suddenly on the brink of being able to automate many expensive repetitive processes – and offer up extensive, accurate data analysis in minimal times.

But with little material gains from AI in the months since, in spite of record sums of investment having been sunk into the leading (still loss-making) developers, sentiment seems to have shifted to more immediate concerns. With the optimism that investing in AI could boost business ebbing away, firms are instead addressing other priorities.

The researchers found that the top concerns were now related to adapting to the current state of the economy, ranked in the top three priorities by 19%; sourcing talent to help address those needs, cited by 16%; and maintaining healthy streams of investment, cited by 12%. Further down the list were regulation, geopolitical concerns, operational risks, cyber security and reputation management – ahead of technology and AI. In fact, according to the researchers, only 8% of executives said cybersecurity was a top three issue – but just 4% said the same of AI.

However, the researchers contend that this is not just because AI has failed to deliver on its promise. It may also be a result of a gap in the non-executive expertise of firms. While the risk of cybersecurity and ESG appear undervalued on the board’s agenda, both are also two of the most frequently cited topics on their board education plans over the coming year – both 11% – suggesting if boards knew more about them already, they might be taking them more seriously as risks. But that figure of planning to educate board members falls to just 7% for AI, which might mean that it is not even seen as a ‘future priority’ in the same way sustainability of cybersecurity are.