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ACCA Strategic Professional · Strategic Business Leader · Machine learning, AI and robotics

Norvale Logistics' board is deciding how to oversee a new AI route-planning system that affects drivers' working hours. A director argues that responsibility for the system's outcomes can be delegated entirely to the IT supplier. Which response best reflects good governance?

The board remains accountable. It should set AI policy, define risk appetite and ensure ongoing monitoring even if the supplier builds the system. Outsourcing may share operational tasks or costs, but it does not transfer directors' responsibility for oversight of significant risks and outcomes.

  1. AAccountability remains with the board, which should set AI policy, define risk appetite and ensure monitoring, even if development is outsourcedCorrect
  2. BAccountability transfers to the supplier once a contract is signed
  3. CAccountability lies with the algorithm, which should be treated as the decision maker
  4. DAccountability lies solely with the drivers affected, who must report problems

Explanation

Directors remain accountable for risk oversight and outcomes of significant systems, whether built internally or bought. Contracts can allocate cost but not the board's governance duty. An algorithm cannot be held accountable, and affected staff cannot carry oversight responsibility.

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