Artificial intelligence (AI) is no longer a futuristic concept. It is reshaping industry, and its impact is growing fast. This is why AI belongs at the center of board-level discussions. During a recent two-day AI Leadership and Corporate Governance workshop for the PNB Board led by Roger Collantes of Global Learning Solutions (Singapore), one message was clear: AI is now a strategic imperative — not a technical add-on.
AI refers to technology designed to perform tasks that normally require human intelligence: learning, recognizing patterns, analyzing data, solving problems, and generating responses. It can work at a speed and scale far beyond human capability. But boards must remember this essential truth: AI is powerful, but it is not magical. It does not “think” or “reason” like humans. It has no ethics or values at all. Its output is only as good as the data it receives. Hence, garbage data, garbage output. Regular testing, validation, and strong data governance are critical.
AI is no longer just an operational tool. It affects every part of a business — its people, customers, growth, and risks. Thus, boards must approach AI as a strategic force where key areas of impact are:
1. Workforce engagement – AI handles repetitive tasks, allowing employees to focus on higher-value work — improving morale, innovation, and productivity.
2. Customer trust – AI enables more personalized products and services. When implemented responsibly, it strengthens data protection and enhances reputation.
3. Business growth – AI identifies new revenue opportunities, improves efficiency, and sharpens competitiveness — especially in banking where speed, accuracy, and risk detection are critical.
4. Risk and compliance – AI enhances fraud monitoring, regulatory reporting, and overall risk governance.
Boards must shift from passive oversight to active stewardship by guiding data governance, talent and reskilling, responsible AI innovation, and long-term AI strategy. AI with human judgment is a necessary partnership, as AI cannot replace human values, empathy, or ethics. A machine has no moral compass. It responds based on patterns, not principles. Therefore, responsibility always stays with people.
Boards must ensure the organization champions ethical AI, with four pillars, namely, fairness (avoid bias across all demographics), accountability (humans, not machines, must be responsible for outcomes), transparency (AI decision-making should be clear and explainable), and privacy (protect data, collect only what’s necessary, and secure sensitive information). To lead effectively in the AI era, boards must shift from simply monitoring risks to actively shaping strategy. Leaders must understand that AI is reshaping global banking and governance. AI is a strategic driver, not a simple tech upgrade. AI should be central to business growth. AI offers major opportunities alongside significant risks, so businesses enable innovation with ethics and trust. Boards must support workforce reskilling. What capabilities and competencies must the workforce have to remain relevant and viable? Boards must provide strong oversight and clear accountability.
What can AI bring to banking? Its potential is extensive: hyper-personalized customer experiences, faster and smarter decision-making, better risk detection and prevention, automation of both front- and back-office work, and more accurate credit scoring and customer insights. At the Nov. 12 “Agentic AI Unmasked” event presented by John Clements Consultants led by Carol Dominguez, ING Country Manager Jun Palanca shared ING’s GenAI program, discussing where the technology has the biggest potential to transform business processes and bring superior value to customers.
Examples are personalization of offers and marketing campaigns the automation and acceleration of Know-Your-Customer processes, and anti-money laundering operations. Jun said GenAI is also used for data extraction and improvement of early warning indicators for lending risk, among others.
“The best banks don’t just use AI — they build culture, guardrails, and governance around it. Those who succeed will be the ones who master both algorithms and accountability” said Roger.
AI is here and is transforming. Boards must understand, guide, embrace and actually govern it. Board leaders must ask the right questions, set responsible but ambitious AI directions, and ensure the organization delivers AI-powered, human-centered growth. Companies, especially banks with strong and ood data discipline, risk culture and accountability, can take advantage, while failure may be accelerated in weakly-governed institutions. The board’s role is to set boundries, assign repsonsibility and fund capability building. The future belongs to institutions that combine technology with wisdom, ensuring that AI serves people and not the other way around.
Merry Christmas and Happy New Year! Let us remember the reason for the season: the one up above born to be our SAVIOR!
The views expressed herein are her own and do not necessarily reflect the opinion of her office as well as FINEX.
Flor G. Tarriela is a banking professional. Formerly chairman of PNB and currently a board advisor to PNB and LTG. She is a director in Nickel Asia and Finex Foundation. She is also a gardener/environmentalist.
