Guiding the Human Side of AI: Priorities for Compensation & Human Capital Committees

For Compensation and Human Capital Committees (CHCCs), artificial intelligence represents far more than a routine technology upgrade, it’s a game-changer that’s reshaping the way companies operate and manage talent. Since generative AI burst onto the scene in 2022, companies have been compelled to rethink not only their business models, but also how they attract, develop, and support their people. The stakes are high: CHCCs must champion innovation, navigate new risks, and ensure employees thrive amid rapid change.

Recently, during a fireside chat “Preparing Your Workforce to Embrace AI – Insights for Board Members,” BDO’s People Strategy & Solutions Leader Cheryl Fields Tyler and Atkore’s  Chief information Officer David Dulfer explored how boards can lead the way in workforce strategy for an AI-driven future. Here’s where CHCCs should focus their attention now:

  • Identify Where AI Can Drive Value

    AI has the power to disrupt established business models, automate tasks, and create new opportunities. CHCCs should encourage their organizations to look beyond efficiency and ask: Where can AI elevate our workforce and business? This means forming cross-functional teams to brainstorm use cases, prioritizing projects based on readiness and impact, and always considering how these changes will affect job roles and required skills. Workforce planning must be integrated into every AI initiative, with strategies for reskilling, upskilling, or redeploying employees.

  • Define Your Values and Approach to AI

    Ethical considerations and transparency are critical as AI adoption accelerates. Companies need to articulate their values and philosophy around AI - how it should be used, and how to mitigate negative outcomes like job displacement or increased resource consumption. CHCCs play a key role in establishing, communicating and embedding ethical guidelines in the culture, with ongoing monitoring and remediation for both human and machine actions.

  • Build Strong AI Governance

    AI governance  is essential for managing risk and maximizing opportunity. While AI can automate decisions and generate insights, human oversight remains crucial. CHCCs should help to ensure governance structures are robust, compliance programs are in place, and employees are educated and held accountable. Regular updates from executives like the CIO, CISO, and CHRO help maintain oversight and transparency.

  • Lead Cultural Change and Employee Engagement

    AI adoption is as much about people as it is about technology. Successful implementation depends on employee advocacy, engagement, and trust. CHCCs should champion transparent communication, ongoing education, and incentives that support adoption. Fostering an “everyday AI” mindset—where experimentation and risk-taking are encouraged—can boost both adoption rates and employee satisfaction. Creating a supportive environment with upskilling opportunities and clear messaging builds trust and resilience. For more insights, see BDO’s research report:

  • Support Employee Well-being Through the Transition

    AI can reduce burnout and improve morale—and overall well-being—by automating mundane and repetitive tasks, allowing employees to focus on more meaningful work. CHCCs should make sure management is supporting employees through change—whether that means upskilling, redeployment, or even thoughtful offboarding. It’s equally important to highlight new opportunities and positive impacts, helping employees adapt and grow their careers in an AI-enabled workplace.

  • Use AI to Enhance Performance Management

    AI-powered tools can provide timely, data-driven feedback and help align employee and leadership metrics with company strategy. CHCCs should explore how these tools can drive performance improvement and productivity, inform professional development, and help to ensure that business metrics are relevant and actionable.

  • Make Corporate Reporting AI-Ready

    External stakeholders—including proxy advisors, portfolio managers, and shareholders—increasingly use AI to analyze corporate disclosures. CHCCs should write and structure reports for maximum AI readability, as well as leverage AI to benchmark against competitors and industry standards. This includes analyzing key terms, word choice, design, and data structuring within proxies and 10-Ks to maximize AI readability.  

  • The Bottom Line

    AI is reshaping work, and CHCCs are at the forefront of guiding organizations through this transformation. By combining strategic oversight with a focus on people, ethics, and culture, directors can help future-proof their workforce and drive sustainable growth.

    Wherever you are in your AI journey, BDO provides comprehensive AI services and solutions to help you find efficiencies, address business challenges, and foster sustainable growth. 

    The BDO Center for Corporate Governance endeavors to support directors in engaging in effective governance by providing insights, learning, and networking opportunities in collaboration with BDO subject matter specialists and advisors designed specifically for boards of directors.