Makhlouf calls for board expertise on AI and bank risks
Gabriel Makhlouf, Governor of the Central Bank of Ireland, called for board expertise and effective challenge in Dublin on October 9, 2026. He spoke at a bank governance book launch honoring editors Professors Blanaid Clarke and Christina Livada.
Board challenge extends to AI
Makhlouf said the financial crisis demonstrated the damage caused when boards misunderstand risks or fail to challenge management.
Citing Mary Elizabeth McMunn, he stressed that difficult conditions test whether information reaches decision-makers quickly, concerns are heard and boards act in time.
He linked effective challenge to expertise, independent thinking, diversity and inclusion.
Boards must address financial risks alongside cyber threats, disruption to critical services and dependence on external providers.
AI offers opportunities to improve services and operations, he said, but boards need enough understanding to assess its limitations and keep responsibility for decisions clear.
Clearer rules and personal responsibilities
Makhlouf linked strong governance to the Central Bank's Regulating and Supervising Well work: clearer regulation, less duplication and reduced unnecessary complexity.
The book examines the Capital Requirements Directive, including responses to climate and environmental risks.
Fitness and probity and individual accountability frameworks cover suitability, responsibilities and standards.
Following Andrea Enria's review, the Central Bank has worked to make its fitness and probity processes clearer, fairer and more consistent.
Accountability needs collective challenge
Makhlouf paired individual ownership of decisions with boards' collective ability to challenge their direction.
He presented exchange among researchers, practitioners and supervisors as a way to examine these governance questions.
He then handed over to Colm to chair the panel.
Source: The evolution of bank governance in the EU
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