Makhlouf urges bank boards to strengthen oversight of AI risks
Central Bank of Ireland Governor Gabriel Makhlouf called on European bank boards to sharpen oversight of emerging risks, including artificial intelligence and operational resilience. Speaking on October 9, 2026, he emphasized individual accountability and clearer supervisory rules.
Boardroom culture tested by algorithms
Speaking at the launch of a study on European bank governance edited by Blanaid Clarke and Christina Livada, Gabriel Makhlouf noted that lessons from the financial crisis remain relevant.
He highlighted that operational resilience, third-party vendor dependency and artificial intelligence adoption pose novel demands on management.
Boards must understand technological limitations and ensure clear accountability for automated decisions.
Makhlouf also pointed to reforms following Andrea Enria’s review, which led the Central Bank of Ireland to make its fitness and probity framework clearer and more consistent.
Within credit institutions, individual accountability must support timely escalation when operational conditions deteriorate.
Streamlining the rulebook
The remarks coincide with European efforts to refine the Capital Requirements Directive and integrate climate risk assessments into supervisory standards.
Makhlouf linked effective internal governance to the central bank’s initiative on regulating and supervising well, aiming to remove duplication and curtail unnecessary regulatory complexity.
Citing Director Mary Elizabeth McMunn, he stressed that boards prove their competence primarily under strain, requiring intellectual diversity to challenge executives before risks materialize.
Accountability beyond platitudes
Makhlouf rightly flags artificial intelligence and operational fragility as urgent boardroom tests.
Yet preaching cultural diversity cannot replace strict supervisory sanctions against structural failures.
Without tough enforcement of accountability rules, European bank governance remains largely performative.