FROM: Joe Michael, Chief Information Officer
SUBJECT: Artificial Intelligence Policy
RECOMMENDATION:
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Approve and Adopt Administrative Policy No. 023 (Artificial Intelligence).
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BACKGROUND:
In an era where artificial intelligence (AI) is transforming industries and redefining best practices, it is essential for SBCERA to adopt a comprehensive AI policy. This policy will establish clear governance over AI technologies, ensuring their ethical and responsible use. By setting a framework for AI adoption, the policy will address potential data security, bias, transparency, and accountability concerns. It will provide a unified standard that guides the organization, fostering trust and confidence in AI-driven processes while mitigating risks.
Moreover, the implementation of an AI policy will enable the organization to pursue innovative AI initiatives that align with its strategic goals. With proper governance, we can harness AI to enhance operational efficiency, streamline decision-making, and create tailored solutions for our membership. By leveraging AI responsibly, the organization will improve service delivery and position itself as a forward-thinking leader. These initiatives can have long-term value, enhance member engagement, and strengthen the organization's use and flexibility of technologies.
Finally, pension systems that fail to establish governance risk falling behind in adopting technologies that enhance their systems and services to their membership. With a formal AI policy, we can identify opportunities for AI deployment, foster innovation, and ensure alignment with ethical principles and regulatory standards. This proactive approach will not only maximize the benefits of AI but also safeguard the interests of the organization and its members, laying the foundation for continued technological growth and success.
COMMITTEE REVIEW:
This item was first reviewed by the Administrative Committee at its January 16, 2025 meeting. At this meeting, the Committee discussed and recommended the following edits: the addition of an AI definition, additional clarification restricting external data integration, removal of words with negative connotations, the addition of explicitly prohibited items dealing with transactions and financial matters and staff-approved exceptions to be brought back to the Committee. The updated item was then reviewed by the Administrative Committee at its February 20, 2024 meeting, and recommended Board approval as amended with a 4-0 vote. One additional edit was made to ensure we comply with existing regulations.
BUDGET IMPACT:
None.
STRATEGIC PLANNING GOAL/OBJECTIVE:
Operational Excellence & Efficiency
STAFF CONTACT:
Joe Michael
ATTACHMENTS:
Exhibit A: Proposed Administrative Policy No. 023 (Artificial Intelligence)