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IOL News
6 days ago
- Business
- IOL News
Governing innovation: enabling disruption without losing control
Governance is not about constraining creativity but stewarding it wisely. A board that governs innovation well does not seek to eliminate uncertainty, but to navigate it with foresight and discipline. Image: AI Lab By Nqobani Mzizi In this modern era of unrelenting disruption, boards are increasingly required to go beyond merely overseeing performance. They must also enable innovation. Technologies like generative AI, ESG-linked investment models, and platform-based business strategies are reshaping industries. These changes demand not only operational adjustments but also bold strategic reinvention. Yet many boards are grappling with how to respond to innovation strategically, without compromising their core governance responsibilities. This uncharted terrain is testing the resolve of modern boards. Traditional governance models were built for stability, predictability and control. Innovation, in contrast, is uncertain, iterative, and non-linear. It often involves experimentation, ambiguity, and sometimes failure. For boards used to structured reports, clear metrics, and linear plans, this unpredictability can seem risky. Yet paradoxically, resisting innovation presents a greater threat than any of those listed on the strategic or operational risk registers. As digital disruption and societal shifts accelerate, the board's ability to cultivate innovation has become essential to long-term value creation. A common governance blind spot is to relegate innovation to a management function, with limited strategic involvement from the board. The assumption that management is inherently more equipped to drive innovation can be detrimental. This gap may stem from a lack of technological fluency, unclear mandates or discomfort with the intangible nature of innovation. The result is often a lag: boards are briefed on innovations after the fact, rather than helping to shape direction, assess risk appetite or define success. This reactive posture creates a widening governance gap, one that threatens not only agility but long-term relevance. The 2023 McKinsey Global Board Survey reveals a troubling paradox: while 87% of directors cite innovation as a top three priority, fewer than 20% believe their board governs it effectively. This is more than a governance failure; it signals a countdown to organisational irrelevance. Boards must now reconsider what it truly means to govern innovation. Governing innovation does not mean micromanaging trial and discovery. Instead, it means creating the conditions under which innovation can thrive ethically, strategically and responsibly. It involves asking the right questions: does the board have visibility into the innovation pipeline? Is there alignment between novel initiatives and long-term strategy? Are ethical risks, data governance and unintended consequences being considered? Today's stakeholders, whether customers, investors, regulators or communities, expect organisations to innovate responsibly. Boards must ensure that these efforts are not only profitable but also purposeful. King IV offers helpful guidance. Principle 4 speaks to the board's responsibility to appreciate that strategy, risk, performance and sustainability are inseparable. This includes nurturing forward-looking capability not as a standalone concept, but as a core element of strategy. Principle 6 further calls on the governing body to ensure that risk governance enables rather than stifles opportunity, including calculated risk-taking in pursuit of innovation. Boardrooms that successfully navigate innovation often exhibit a shift in culture: from risk aversion to constructive inquiry. They influence disruptive growth strategy, empower management to explore, remain informed, and maintain clarity on governance boundaries. They create healthy space for emergent thinking, scenario planning, and strategic 'what ifs'. They also recognise that not every new idea will succeed, and that setbacks, when properly governed, can become valuable sources of learning rather than liability. Sanlam's board didn't just approve partnerships; they embedded innovation into governance. As one of Africa's largest insurers, the company has, since 2021, actively expanded into fintech and inclusive insurance models across emerging markets. Notable recent initiatives include strategic partnerships launched in 2023 with digital platforms in India and Africa to deliver tailored insurance products to underinsured populations. The board's commitment to strategic modernisation is evident in its approach to ecosystem partnerships and sustainable growth. Similarly, Rain's digital-first disruption required its board to rethink traditional governance. Since its 2018 launch as South Africa's data-only mobile network, the company's bold strategy demanded governance structures that could support rapid scaling. The board implemented oversight enhancements in 2022 that strengthened both customer trust and technological agility, proving that disruptive growth and strong governance aren't mutually exclusive. Effective governance of innovation may require boards to rethink their own composition. Do directors bring diverse perspectives, digital fluency, or entrepreneurial experience? Are there mechanisms for onboarding emerging expertise without disrupting governance coherence?Increasingly, progressive boards are including innovation experts on committees, engaging external advisors, or hosting learning sessions with disruptors to sharpen their own lens. Boards should elevate innovation to a standing agenda item to ensure consistent strategic attention. They can also establish dedicated innovation or technology committees tasked with monitoring emerging trends and risks. These committees track tangible innovation metrics such as percentage of revenue from new products, rate of project progression through innovation pipelines, and measures of customer adoption or satisfaction linked to novel offerings. Dashboards integrating these metrics into board reports enable timely interventions and strategic alignment. Finally, for high-impact innovation bets, boards may consider engaging independent panels or conducting peer reviews to provide fresh perspectives, challenge assumptions and strengthen decision quality. Boards must also examine whether their own rhythms support adaptability and reinvention. An annual strategy retreat is not sufficient. Agile governance requires periodic check-ins on emerging initiatives and a willingness to evolve oversight models in step with emerging realities. The tension between innovation and control is often overstated. Governance is not about constraining creativity but stewarding it wisely. A board that governs innovation well does not seek to eliminate uncertainty, but to navigate it with foresight and discipline. To govern innovation is to ensure that risk and renewal are not seen as trade-offs, but as twin responsibilities of a future-fit board. This requires courage, curiosity and humility; attributes not always associated with traditional governance but essential in the age of transformation. To remain future-fit, boards must ask: Are we fostering innovation or merely observing it? Do our governance processes support creative exploration, or stifle it? Is our board equipped to interrogate the future, not just report on the past? Are we balancing risk management with opportunity stewardship? Ultimately, thriving organisations will be those governed by boards that treat innovation not as a threat to control, but as a catalyst for renewal, turning uncertainty into lasting value through foresight, adaptability and curiosity. Nqobani Mzizi is a Professional Accountant (SA), (IoDSA) and an Academic. Image: Supplied * Nqobani Mzizi is a Professional Accountant (SA), (IoDSA) and an Academic. ** The views expressed do not necessarily reflect the views of IOL or Independent Media. BUSINESS REPORT
IOL News
29-07-2025
- Business
- IOL News
Bankable new hires: How AI is reshaping banking talent
The proliferation of AI in the workforce not only demands embedding AI fluency early, but also, a more strategic approach to developing young talent, says the author. Image: AI Lab Artificial Intelligence (AI) is disrupting every phase of the banking value chain – including, critically, the recruitment of a workforce equipped to navigate its breakneck pace of change while sustaining both current and future business resilience. We're witnessing a paradox in recruitment. While companies rely on AI to filter applications, candidates are also turning to AI to refine and enhance theirs. From autogenerated responses to simulated interviews, technology is influencing both sides of the process. In a country where youth unemployment stands at 45.5% among individuals aged 15-34 years, the proliferation of AI in the workforce not only demands embedding AI fluency early, but also, a more strategic approach to developing young talent. Rethinking Graduate Roles Absa's graduate programme within Corporate and Investment Banking (CIB) reflects this mindset. It's an 18-month rotation through various desks, including research and technical teams, and now includes exposure to AI, which is a growing exploratory area. Our Gen A Grad Programme blends theory, business skills, technical knowledge, soft skills, and on-the-job learning. Two years ago, the bank partnered with a corporate executive training firm to enhance the programme's relevance and introduce an AI component. Today, our graduates work on practical, real-world case studies in GenAI, AI, and data — and the feedback from receiving teams suggests we are on the right track. Receiving teams have praised the diverse and forward-thinking skillsets that these graduates bring. The programme has trained many graduates, equipping them with the tools to lead confidently in a technology-driven financial landscape. Where early-career professionals once gained experience by handling routine administrative tasks, AI now takes care of many of these responsibilities, from notetaking to task-tracking. This creates space for young hires to contribute more strategically from the outset. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ However, it also raises the bar: employers must ensure that graduates are equipped not only with technical know-how but with a critical understanding of how to use these tools effectively, ethically, and responsibly. At the same time, digital inequity presents a real challenge. Not all graduates have access to advanced AI tools, reliable internet, or exposure to the systems they'll be expected to use in the workplace. Left unaddressed, this divide creates a two-speed workforce. Graduate programmes must account for this gap and provide equal opportunities for all entrants to thrive. Authenticity and Ethics in an AI-Driven Talent Landscape As we accelerate digitisation, we must remain committed to human-centred hiring. Applicants want to be seen for who they are, not simply how well they navigate an algorithm. Similarly, employers want to attract real talent, not just those who know how to game AI-powered systems. That's why it's critical to establish clear standards around the ethical use of AI in recruitment. Creating a culture of ethical AI use starts early. This goes beyond compliance; it's about shaping habits and values from the outset. Young professionals should be encouraged to question the tools they use, understand AI's limitations, and be confident in their own voice. On the employer side, transparency and consistency are vital, along with providing support for responsible AI engagement across all levels of experience. Technical expertise – like coding in Python or Java – is still important. But so are softer skills like adaptability, digital storytelling and data ethics. Future-ready professionals will be those who combine technical fluency with a clear sense of accountability and social impact. Build with People, Not Just Technology The future of banking isn't just digital. It is also human. To navigate AI disruption effectively, banks must prioritise people-first transformation. That means building graduate programmes that mirror the pace of change to fully meet the moment. It also means crafting upskilling strategies that blend theory with application, and most of all, creating environments where innovation thrives. We don't yet know exactly what the AI-era bank will look like in 10 years. But we do know it will be built by people who understand technology, adapt with agility, and bring purpose-driven thinking to the table. Marsha De Wet is the Global Markets Chief Operating Officer at Absa CIB. Image: Supplied Marsha De Wet is the Global Markets Chief Operating Officer at Absa CIB *** The views expressed here do not necessarily represent those of Independent Media or IOL BUSINESS REPORT
Nikkei Asia
23-07-2025
- Business
- Nikkei Asia
Amazon to shut down Shanghai AI research lab
Amazon says it is cutting jobs in Shanghai due to a streamlining effort and not primarily because of AI. CISSY ZHOU HONG KONG -- Amazon is shutting down its AI Lab in Shanghai, the latest U.S. tech giant to retreat from China amid ongoing trade and tech tensions between the world's two largest economies. "After a thorough review of our organization, our priorities, and what we need to focus on going forward, we've made the difficult business decision to eliminate some roles across particular teams in AWS," said Amazon spokesperson Brad Glasser, referring to Amazon Web Services, the company's cloud computing platform.
Nikkei Asia
23-07-2025
- Business
- Nikkei Asia
Amazon to shut down Shangai AI research lab
Amazon says it is cutting jobs in Shanghai due to a streamlining effort and not primarily because of AI. CISSY ZHOU HONG KONG -- Amazon is shutting down its AI Lab in Shanghai, the latest U.S. tech giant to retreat from China amid ongoing trade and tech tensions between the world's two largest economies. "After a thorough review of our organization, our priorities, and what we need to focus on going forward, we've made the difficult business decision to eliminate some roles across particular teams in AWS," said Amazon spokesperson Brad Glasser, referring to Amazon Web Services, the company's cloud computing platform.
IOL News
22-07-2025
- Business
- IOL News
Purpose at the pinnacle: Why boards must reclaim organisational intent
Stakeholders are increasingly attuned to authenticity, and they hold boards accountable not just for financial results, but for moral coherence. Image: AI Lab Nqobani Mzizi For many organisations, the word "purpose" has become an aspirational placeholder—framed on walls, repeated in reports, and recited at town halls. Yet too often, it remains disconnected from the daily decisions that shape an organisation's impact. When boards treat purpose as a branding exercise rather than a governance imperative, they reduce it to performance theatre. This squanders the board's most powerful tool—the ability to drive true strategic alignment and long-term value creation. The board is the highest custodian of purpose. Defining purpose is not management's job alone. That accountability lies at the board's apex. King IV echoes this, stating under Principle 1 that the governing body should lead ethically and effectively, and under Principle 4 that it should ensure the organisation is seen as a responsible corporate citizen. Purpose is the anchor aligning ethical conduct and strategic direction. According to ISO 37000, the international governance standard, organisational purpose is the foundation from which all governance conditions and practices flow. Yet in too many boardrooms, purpose is treated as abstract or sentimental—useful for external messaging, but irrelevant to risk oversight or financial strategy. This failure to anchor purpose at the governance level explains why so many organisations drift. Without clear organisational intent, strategy becomes reactive, culture becomes performative, and stakeholder trust becomes fragile. And while boards may pride themselves on fiduciary rigour or ESG compliance, they often overlook the foundational question: 'what are we here to do, and for whom'? Organisational purpose is not a slogan. It is a directional force. When articulated with clarity and courage, it helps boards make trade-offs, allocate capital more wisely, and weigh long-term implications against short-term wins. In times of crisis or disruption, purpose becomes the compass. But a compass only works when it is consulted. And boards that delegate purpose-setting to branding consultants or CSR departments are not governing; they are observing. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Ad loading South African examples illustrate this alignment. Take African Bank: its board anchored the organisation's mission to 'advance lives through financial services,' ensuring strategic decisions, from capital allocation to product approval, reflected this intent. When launching Isiko, a financial product designed for culturally significant events like lobola or cultural ceremonies, management's proposal was evaluated against the board's governance lens: does this meaningfully advance lives? Does it align with our broader social relevance? By treating purpose as a strategic filter, not just a slogan, the board turned intent into accountability. This contrasts with organisations where purpose is rubber-stamped but absent from key decisions. Discovery, under Adrian Gore's leadership, provides another example. The Vitality-based business model, which incentivises healthier behaviour through financial rewards, has been underpinned by a clear purpose: making people healthier and enhancing lives. The board has integrated this purpose into international expansion strategies, risk frameworks, and partnerships, ensuring that the business logic aligns with its social intent. Discovery's directors understand that purpose, when governed actively, is not a constraint, but a multiplier of innovation and differentiation. Another glaring case is that of Unilever under the leadership of Paul Polman. He challenged the status quo by embedding sustainability into the core of business strategy, encouraging longer-term thinking even when quarterly earnings suffered. The board backed a shift away from short-termism, aligning its oversight functions with Unilever's Sustainable Living Plan. The board's resolve to support Polman's decisions amid investor resistance shows how purpose can be governed with conviction, not just communicated. Conversely, when purpose is absent or allowed to fracture, organisations risk governance drift, cultural malaise, and even catastrophic ethical failure. Intention is not enough. Purpose must be fully embedded in strategy, oversight, and reward, integrated into board processes and strategic decisions. Is purpose considered when approving strategy, setting KPIs, evaluating executive performance, or assessing risk appetite? Does the board measure the alignment between stated purpose and stakeholder perception? Or is purpose left behind once the mission statement is signed off? Purpose also acts as a powerful diagnostic tool. When governance failures emerge, whether through ethical lapses, reputational harm or cultural toxicity, they often reflect a disconnection between stated intent and actual behaviour. Purpose, when governed well, is a form of risk mitigation. But when left untethered, it can become a source of disillusionment. Stakeholders are increasingly attuned to authenticity, and they hold boards accountable not just for financial results, but for moral coherence. This is not to suggest that boards must become moral philosophers or abandon profit. Rather, it is to remind us that profit without purpose is extractive and unsustainable. A well-governed purpose does not undermine commercial viability; it enhances it by providing a consistent framework for decisions, a north star during uncertainty, and a narrative that binds employees, customers, and investors to a shared vision. Reclaiming purpose is not about rewriting taglines but about embedding intent into the DNA of governance. Boards serious about reclaiming purpose should ask: Are we governing purpose as a core board responsibility or outsourcing it to brand managers? Do our strategic decisions reflect our declared intent, especially when trade-offs are required? Have we built governance processes that test for purpose alignment across performance, risk, and remuneration? Are we willing to revisit our purpose when stakeholder needs, societal expectations or market realities shift? As boards prepare for increasingly complex futures shaped by technological disruption, climate imperatives, and shifting social expectations, purpose becomes more than a virtue. It becomes a necessity. It is the one thing that cannot be automated, outsourced or legislated. It must be owned. At the highest level. With clarity. And with courage. Nqobani Mzizi is a Professional Accountant (SA), (IoDSA) and an Academic. Image: Supplied * Nqobani Mzizi is a Professional Accountant (SA), (IoDSA) and an Academic. ** The views expressed do not necessarily reflect the views of IOL or Independent Media. BUSINESS REPORT
